MEDIUM-TERM BUDGET: BORROWING
Economists sound alarm on spiralling debt
Debt and debt-service costs are projected to rise drastically over the next three to four years
SA’s public sector debt has exceeded levels last seen at the advent of democracy and indicates an economy on its knees. Debt and debt-service costs are projected to rise drastically over the next three to four years. On Wednesday, the Treasury forecast an increase in the debt-to-GDP ratio to 60% by the 2020-21 fiscal year. In 1993-94, the ratio was 48.3%. Standard Bank chief economist Goolam Ballim said the medium-term budget policy statement revealed that SA’s political establishment had no clothes. "The finance minister was impressively candid about SA’s dire situation. This was, however, matched by his inability to show a path to resolution." "Until we glean who the next ANC leadership is going to be, we are going to remain paralysed. Private-sector capital and investment is going to remain in recessionary mode." Ballim said the budget had provided "no practical, plausible and implementable measures" to calm the markets. "If anything, the minister laid bare the increased propensi...
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