Given market liquidity at approximately P20 billion and the government's caps and policies on domestic borrowing, the central bank could statutorily approach the market for the entire deficit.
Fiscal rules state that the government cannot borrow, either domestically or abroad, more than 20 percent of the Gross Domestic Product (GDP). Taking into account the five outstanding government bonds worth P5 billion and projected GDP of P99.7 billion for 2010/11, the government is entitled to borrow up to P14.9 billion locally. The Deputy Secretary (Development Programmes) in the Ministry of Finance and Development Planning, Cornelius Dekop, says discussions with the Bank of Botswana (BoB) "should be done in May". "There are technical matters that are being discussed," he said. "For instance, the tenures of the different bonds we would like to float. We should be done in May because we need that funding urgently for the financial year that is already underway. But we have not yet finalised how much we will borrow from the local market."
