Gov't suspends GPOs amidst liquidity crunch
Innocent Selatlhwa | Wednesday July 16, 2025 14:04
This was announced by Permanent Secretary in the Finance ministry, Dr Tshokolo Kganetsano, through a savinggram dated July 10, 2025. He explained that the challenges are due to the continued significant decline in revenue inflows, which, to a large extent, are caused by the decreased diamond sales, which have been the main source of revenue for the government.
“Based on the current situation, the government is therefore compelled to take immediate action, which requires concerted effort across all Ministries, Departments, and Agencies (MDAs) to ensure financial stability and sustainability.
“Furthermore, despite the decreased revenue inflows, public expenditure has, on the other hand, increased, thus exacerbating the situation,” he stated.
Kganetsano further stated that whilst MOF has been steadfast in cautioning MDAs on their spending in view of the current financial situation, MDAs continue to commit the government to more financial obligations.
He said it has to be noted that borrowing by the government to finance running costs or non-revenue generating projects is not sustainable and, therefore, not a solution to the current liquidity challenges.
“The ministry has taken note of the recent loan proceeds from BPOPF and Bank of Botswana amounting to P8.3 billion that were channelled towards, amongst others, payment of salaries, social benefits allowances, student tuition fees, repayment of public debt, resulting in the funds being depleted within a week.
“Ideally, these funds should have been directed towards development projects with the capacity to create jobs and generate more income,” he stated.
He said it is on this basis that a decision has been taken to suspend the online generation of GPOs from July 14 to 31, 2025. MDAs will, during this period,d not be allowed to process or submit manual GPOs.
However, the Ministry will make considerations on exceptional cases, which should be routed through the Ministry's Permanent Secretary.
A GPO is a document used by government entities to authorise and record the purchase of goods or services from suppliers. It serves as a legally binding contract once the supplier accepts it, outlining the details of the transaction, including items, quantities, prices, and payment terms.
GPOs are also used as collateral by Small, Micro and Medium Enterprises to access finance.