Botswana's budget deficit is projected to more than double, largely due to falling diamond revenues, the country's Finance Ministry said in a draft 2025-2026 budget strategy paper.
"The weaker-than expected activities in the diamond market has put pressure on the fiscal revenues, particularly mineral revenue. To this end, the fiscal outturn in the 2024/2025 financial year [ending on March 31] is expected to be subdued, recording a much wider deficit than anticipated earlier in February 2024," the paper read.
According to the draft budget, the deficit is expected to more than double to 18.6 billion pula ($1.4 billion) or 6.7% of GDP, a significant increase from the previously forecast deficit of 8.7 billion pula ($637.3 million).
"The latest preliminary data shows that as at the end of September 2024, mineral revenue stood at 3.84 billion pula [$281.3 million] compared to an estimate of 12.59 billion pula [$922.2 million] in the original budget, representing an under collection of 8.75 billion pula [$640.9 million] or 69.5%," the ministry pointed out.
Economic growth is also expected to be lower than initially projected.