Subdued global demand and prices for diamonds is weighing on Botswana's minerals-dependent fiscal revenues and exports. Absent a concerted fiscal effort by the government or substantial improvement in diamond prices and sales volumes, we project Botswana's fiscal consolidation efforts will remain challenging. We forecast government debt, net of liquid assets, to rise to 19% of GDP by 2028 from 3% in 2024. We therefore revised our outlook on Botswana to negative from stable and affirmed our 'BBB+/A-2' long- and short-term sovereign credit ratings. On March 14, 2025, S&P Global Ratings revised its outlook on Botswana to negative from stable. At the same time, we affirmed our 'BBB+' long-term and 'A-2' short-term foreign and local currency sovereign credit ratings on Botswana.
