Finance Minister Peggy Serame, in the 2023 Budget speech on Monday, forecast Botswana’s growth to decelerate to 4 percent this year from a revised estimate of 6.7 percent for 2022.
The slower growth in 2022 is expected on the back of a slowdown in economic growth and possible recession in advanced countries. According to Serame, worsening global economic conditions may adversely affect diamond sales this year, with implications for export earnings and government revenue. Notably, the growth forecast of 6.7 percent for 2022 is significantly higher than the 4.2 percent forecast by the Finance Ministry in September due to better-than-expected performances in the non-mining and mining sector.
The budget deficit is forecast at P7.59bn or 3.1 percent of GDP in the year through March 2024, compared with a P4.9bn gap or 2.1 percent of GDP in the current fiscal year. As much as P3bn of the deficit will be financed from the domestic debt capital market, P2.7bn from external loans, and the balance from government reserves.