Moody's downgrades Botswana

Moody's Investors Service said it lowered the government of Botswana's long-term local and foreign currency issuer ratings to A3 from A2 and changed the outlook to stable from negative.

“The downgrade to A3 reflects the deterioration in fiscal strength exacerbated by the shock induced by the coronavirus pandemic. As a result, Botswana's fiscal buffers have been eroded, reducing the government's fiscal space to absorb future shocks, to which the country is more exposed than most of its A-rated peers. At the same time, Botswana's credit profile continues to be supported by robust fiscal metrics, in particular a low debt level and high debt affordability,” Moody’s said in a press release.

The outlook balances expectations that Botswana's credit metrics will remain commensurate with the A3 rating, the agency said.

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