Time is slipping away for SA if public sector debt continues to spiral, the IMF has warned. Public debt as a share of GDP doubled in the past decade, reaching 53% in 2017, which has pushed up public sector financing needs. Spending pressures and a higher public sector wage bill could raise financing costs and stunt economic growth further, said the IMF in an ominous statement on Tuesday. After an IMF team led by Ana Lucía Coronel met key stakeholders in the public and private sectors in the past week, the fund suggested the government implement realistic expenditure ceilings or add a debt ceiling to the fiscal framework. “Public debt has risen, depleting buffers and leaving little room for fiscal policy to support growth,” said the IMF. In the past fiscal year, the fiscal deficit was more than one percentage point of GDP above the budget target, as revenues underperformed, affected by low growth, and expenditure was pushed up by bail-out costs for state-owned companies. While the Tr...
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