(Bloomberg) -- Botswana’s budget deficit for the current financial year will more than double to 18.6 billion pula ($1.4 billion), or 6.7% of gross domestic product, due to a sharp drop in diamond receipts, draft estimates from the Finance Ministry show.
In the February budget, it forecast the deficit for the year ending on March 31 at 8.7 billion pula, or 2.8% of GDP, with a record 102.3 billion pula in spending. Mineral revenues, which traditionally account for a third of the budget, are now expected to drop to 8.7 billion pula from the 25.2 billion pula projected back then.
The Ministry said additional spending controls are now needed, apart from measures to cut outlays announced in August.
While no plans were shared on how the wider deficit will be financed, the government has stepped up local market borrowing. The update also said that economic growth would be significantly lower than an earlier projection of 4.2%, without giving a fresh projection.
Newly-elected President Duma Boko has promised a government-wide forensic audit of spending under former President Mokgweetsi Masisi. Having swept to power last month, he is under pressure to deliver on electoral promises to increase pensions, student allowances and other social spending.
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