BOTSWANA: Domestic Bond Market Development

By Trevor A Lessard, Laszlo Buzas, Bill Northfield

March 17, 2023

Preview Citation

Format: Chicago

Trevor A Lessard, Laszlo Buzas, and Bill Northfield. BOTSWANA: Domestic Bond Market Development, (USA: International Monetary Fund, 2023) accessed September 19, 2024

Summary

This paper discusses high-level summery technical assistance report that focuses on Botswana’s domestic bond market development. The implementation of a new monetary policy framework to support the Bank of Botswana’s (BoB) inflation targeting regime is a welcome development for domestic debt market development. There is significant scope to make progress on the authorities’ goal to shift funding from nonconcessional external borrowing to the domestic bond market. Coordination between debt management and liquidity management should be enhanced to facilitate the expansion of the domestic debt market. Material improvements in the secondary market will take more time to bear fruit, and efforts in this area should be sequenced after building blocks that are more foundational are operating more efficiently. Measures to develop the domestic debt market are likely to result temporarily in higher funding costs, but this is a necessary investment in the process and will likely be counterbalanced by lower financing costs in the medium-to-long term.

Subject: International organization, Monetary policy

Keywords: Debt management, Financial market development, Local currency bond market development, Sovereign debt

Publication Details

Pages:

4
Volume:

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DOI:

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Issue:

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Series:

High Level Summary Technical Assistance Report No. 2023/002
Stock No:

HLSEA2023002
ISBN:

9798400235467
ISSN:

2959-4103

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High-Level Summary Technical Assistance Reports