The African Development Bank (AfDB) has approved a $304 million loan to Botswana to help the country manage growing fiscal pressures and implement critical governance and economic reforms.
The loan, endorsed by AfDB’s Board of Directors on May 14, will finance the Economic Resilience and Governance Support Programme, a one-year initiative covering the 2025–2026 fiscal period.
The program is designed to shield Botswana’s economy from the downturn in diamond revenues—diamonds account for nearly 80% of the nation’s exports—while supporting efforts to strengthen financial transparency, boost revenue mobilization, and spur private-sector-led growth.
Botswana’s economy contracted by 1.7% in 2024 amid weak global diamond demand. Meanwhile, the fiscal deficit rose to 4.7% of GDP in 2023–2024 and is projected to widen to 6.7% in the current fiscal year.
“This operation comes at a critical time for Botswana,” said Monaheng Mopotola, AfDB Deputy Director General for Southern Africa and Country Manager for Botswana. “We look forward to working with the new government to implement reforms that will enhance financial sustainability, promote transparency, and create a conducive environment for economic diversification.”
The loan is expected to serve as a short-term fiscal cushion, while supporting the new government, elected in November 2024, in advancing long-term development objectives.
Abdoul Kone, AfDB’s Director of Governance and Economic Reforms, affirmed the Bank’s commitment: “We’re fully aligned with Botswana’s ambitious socio-economic development agenda. Our support includes transformative reforms, project financing, and sustained policy dialogue.”
This latest financing builds on AfDB’s longstanding engagement in Botswana, including the Economic Recovery Support Programme launched in 2021–2022, which was jointly funded with $200 million from the OPEC Fund for International Development.
