By Felicity Duncan
Tito Mboweni will be presenting his maiden budget on Wednesday, after just two weeks in the job. It’s not going to be pretty. South Africa has very, very limited fiscal space right now. The country urgently needs to reduce its budget deficit and start lowering its debt burden, but it must also find ways to reduce the impact of the recession. And he must do all of this while contending with an above-inflation increase in the wage bill for civil servants and continued losses at SOEs.
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Among Mboweni’s priorities, dealing with debt worries must be high on the list. The country needs to address its growing government debt burden if it is to avoid the fate of Argentina and Turkey, both of which have been hit with rampant inflation and skyrocketing interest rates. Yet his ability to raise taxes must, of necessity, be limited. I’m not sure how he’s going to square this circle, but I’ll be glued to the news on Wednesday, as will many others.
In Premium today, you can listen to Alec Hogg share the story of a South African WW2 hero who was written out of history. You can find out what Ajay Gupta said to the New York Times in a rare interview and you can read why The Wall Street Journal says there is an investment case to be made for South Africa.
