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South Africa’s National Treasury has stated that the country is on track to hit two key fiscal targets this year: stabilizing its public debt and expanding its primary budget surplus. This shift follows over a decade of rising debt, driven by spending that consistently outpaced revenue. The current healthier dynamic is driven by a significant revenue increase of over 10% in the first five months of the 2025/26 financial year, while expenditure growth over the same period has been restrained at just 4%. This spending slowdown is partly attributed to political delays in finalizing the main budget within the new coalition government. With the crucial debt-to-GDP ratio expected to stabilize and then decline, the focus now shifts to growing a primary budget surplus. This strategy aims to free up future funds for essential public services and growth-boosting infrastructure.
CNBC Africa