Botswana’s government plans to raise P12 billion from the domestic market in the 2026/27 fiscal year as it moves to finance a widening budget deficit of P26.35 billion, according to its latest borrowing strategy.
The strategy, published by the Ministry of Finance alongside the 2026/27 budget, outlines a mix of bond issuances and Treasury bills, alongside external borrowing, to plug the funding gap.
Of the planned domestic borrowing, P10 billion will be raised through bonds while net Treasury bill issuance will contribute up to P2 billion. The remainder of the deficit will be financed through loans from multilateral development institutions.
The government is leaning toward longer-term instruments, with P6 billion allocated to long-dated and inflation-linked bonds, compared to P4 billion in short-dated bonds, as it seeks to balance borrowing costs with risk and extend the maturity profile of public debt.
“The primary objective is to meet financing needs at the lowest possible cost consistent with prudent risk management,” the Ministry said in the document.
Bond and Treasury bill auctions will typically be held on the final Friday of each month, providing predictability to investors and supporting liquidity in the domestic market. Benchmark bonds will remain concentrated across key maturities, including 5-year, 10-year, 15-year and 25-year instruments, alongside a planned re-issuance of a 20-year inflation-linked bond.
Total financing needs are projected at P33.05 billion for FY2026/27, down from P36.43 billion in the prior year, largely reflecting lower maturities of short-term central bank advances. However, the central government cash requirement itself is rising, underscoring ongoing fiscal pressures.
Authorities also see the borrowing programme as a tool to deepen Botswana’s capital markets by increasing the supply of government securities, improving liquidity, and providing high-quality instruments for investors. The Ministry said issuance plans may be adjusted during the year depending on market conditions and investor demand.