“You can place this file either at /etc/boto.cfg for system-wide use or in the home directory of the user executing the commands as ~/.boto.”

The former simply means that you might create a configuration file named boto.cfg within directory /etc (i.e. it won’t necessarily be there already, depending on how boto has been installed on your particular system).

The latter is indeed phrased a bit unfortunate – ~/.boto means that boto will look for a configuration file named .boto within the home directory of the user executing the commands (i.e. Python scripts) which are facilitating the boto library.

You can read more about this in the boto wiki article BotoConfig, e.g. regarding the question at hand:

A boto config file is simply a .ini format configuration file that specifies values for options that control the behavior of the boto library. Upon startup, the boto library looks for configuration files in the following locations and in the following order:

  1. /etc/boto.cfg – for site-wide settings that all users on this machine will use
  2. ~/.boto – for user-specific settings

You’ll indeed need to prepare a respective configuration file on the server your application is deployed to as well.