Maseru, Feb.18 – The government debt stock has declined by three percent, standing at M22.7 billion at the end of January in the 2025/2026 fiscal year, down from M23.4 billion previously.
This was disclosed by the Minister of Finance and Development Planning, Dr. Rets’elisitsoeMatlanyane, when presenting the 2026/2027 Budget Estimates before a joint sitting of Parliament under the theme “Accelerating Economic Transformation; Building Resilience.”
Dr. Matlanyane said the composition of public debt shifted during the period under review, with the share of domestic debt increasing from 15.4 percent to 16.9 percent, while external debt declined from 84.6 percent to 83.1 percent.
She noted that the external debt portfolio remains largely concessional at 88.4 percent, despite the country’s graduation from the International Development Association (IDA) low-income status to a lower middle-income country. She explained that the new status has resulted in higher borrowing costs from international financial markets.
The Minister emphasised the need to shift policy priorities towards strengthening domestic revenue mobilisation, enforcing disciplined and efficient expenditure, and restoring credibility in policy implementation. She stressed that building economic resilience is no longer optional.
“It is now the central organising principle guiding government’s policy priorities for the 2026/2027 financial year,” she said.
Meanwhile, total expenditure for the 2026/2027 financial year is budgeted at M30.97 billion, representing 67.3 percent of Gross Domestic Product (GDP). Recurrent expenditure amounts to M21.94 billion (47.4 percent of GDP), while capital expenditure is projected at M9.03 billion, accounting for 19.7 percent of GDP.
On the revenue side, personal income tax is projected at M3.54 billion, corporate income tax at M1.11 billion, and value added tax at M4.67 billion.
Ends/LP/BM
