
Budget | Citizens benefiting from only a quarter of spending
Is it time for ‘a proper austerity budget’ that will free up funds for growth-boosting infrastructure projects and service delivery?
Is it time for ‘a proper austerity budget’ that will free up funds for growth-boosting infrastructure projects and service delivery?
National Treasury forecasts a narrowing deficit, from 4.8% of GDP in 2025/26 to 3.8% in 2026/27. Fitch, however, projects larger deficits of 5.1% and 4.5% respectively.
The revised Budget reveals the hard truth: with limited borrowing room and rising demands, Treasury must make tough calls on what to fund – and what to cut.
The SA Reserve Bank is concerned about the liquidity of the country’s financial markets and institutional investors’ exposure to government bonds.
South Africa’s core fiscal challenge is to get the gap between economic growth and the cost of borrowing back into positive territory.
Fitch’s recent affirmation of the country’s BB- rating underscores concerns about weak GDP growth, power shortages, faltering logistics, and a rising government debt-to-GDP ratio.
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