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The 2026/2027 Budget Speech, delivered by Vice President and Minister of Finance Ndaba Gaolathe, outlines a strategic "New Botswana" economic roadmap focused on fiscal discipline and wealth creation.

Here are the key points from the address:

Economic Outlook and Strategy

  • Four-Phase Plan: The budget is part of a broader strategy: stabilization (Phase 1), institutional reform (Phase 2), infrastructure/sectoral development (Phase 3), and achieving a high-income status (Phase 4).

  • Growth Projections: The economy is projected to grow by 4.5% in 2025 and 5.1% in 2026, supported by a recovery in the diamond market and growth in non-mining sectors.

  • Inflation Management: Inflation is expected to remain within the Bank of Botswana's target range of 3% to 6% in the medium term.

Fiscal Policy and Revenue

  • Fiscal Consolidation: The government is committed to reducing the budget deficit, aiming for a surplus by the 2027/2028 financial year through disciplined spending.

  • Tax Reforms: A new Electronic Invoicing System (e-billing) will be introduced to improve VAT collection and reduce tax leakage.

  • Diamond Revenue: Acknowledging the volatility in the diamond market, the government is diversifying revenue streams to reduce "diamond dependency".

Key Sectoral Investments

  • Agriculture: Focus on achieving food security through value-chain development and supporting local farmers.

  • Digital Transformation: Significant funding is allocated to the "Smart Botswana" initiative to digitize government services and enhance the country's AI capabilities.

  • Infrastructure: Continued investment in water distribution, energy projects (including solar and coal-to-liquids), and road networks.

Social Welfare and Human Capital

  • Education: Allocation for vocational training and aligning the education system with the "knowledge-based economy" goals.

  • Health: Prioritizing the procurement of essential medicines and upgrading primary healthcare facilities.

  • Social Safety Nets: Adjustments to old-age pensions and child welfare grants to address the rising cost of living.

In the coming weeks, I will break down more of the points, and predict stocks to look out for based on this speech

Source: Ministry of Finance and BW Government

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