Botswana’s credit profile derives support from its adequate external position arising from positive trade conditions and comfortable foreign currency assets. The country’s fiscal position is also characterized by a manageable deficit and a low debt burden. The economy is supported by effective governance and institutions as compared to regional peers. However, the credit profile is weighed down by a concentrated economic profile and relatively weak monetary structure.
The government's spending plans to support diversification beyond the minerals sector, the proposed rationalization of key state-owned enterprises (SOEs), and its plans to develop the domestic debt market are key elements to monitor.