IMF number two Gita Gopinath warns of SA debt spiral
One of the most senior IMF officials has warned that the interest bill on SA’s growing public debt burden could balloon to more than twice the size of its health budget in the next five years, but said SA’s institutional strengths reduce its risk of debt distress.
The IMF projects that the cost of government debt could rise from its current 19% to 27% by 2028, the fund’s first deputy MD, Gita Gopinath, said in Cape Town on Friday. However, the fund assesses SA’s risk of debt distress as “moderate”, because of SA’s deep financial markets and long-maturity debt, as well as its strong monetary policy...
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