Botswana projects narrower budget deficit for 2020/21

Source: Dr Thapelo Matsheka (Facebook page)

Botswana projects a narrower budget deficit in the 2020/21 fiscal year as the government cuts expenditure and revenue collection improves, Finance Minister Thapelo Matsheka said on Monday. 

The diamond-producing southern African country’s deficit is forecast to narrow to 2.4% of GDP in 2020/21 from 3.9% in the fiscal year ending March, Matsheka said in his budget speech. Botswana plans to swing back to a budget surplus in 2021-22 after four straight years of deficits, he added. The country had initially expected to run a budget surplus in 2020-21.

“Despite the positive economic growth prospects, the country remains in challenging fiscal situation. We plan to return to budget surpluses in the last two years of our six-year development plan which ends in 2023. 

“The goal is to strike a balance between funding of programmes and infrastructure development which are necessary to transform the economy to high income status by 2036 without setting on a fiscally unsustainable trajectory.” 

Botswana’s fiscal year runs from April to March. Matsheka said the economy was expected to keep registering positive growth, but uncertainties in the global economy remained a risk. 

“(United States) and China are the biggest buyers of our diamonds and anything that happens there will impact us,” he said. 

China is currently fighting a coronavirus outbreak that could weigh on its and global growth. 

Disclaimer: The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Source: Reuters

1 year ago

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