A month ago, Team SA, under the leadership of newly elected ANC president Cyril Ramaphosa, attended the World Economic Forum in Davos. In their investor-wooing sales pitch, several policy changes were mooted, chief among them Finance Minister Malusi Gigaba’s undertaking to get the government’s finances back on a sustainable track. But will he succeed? The answer will be clear after he has delivered the 2018 budget on Wednesday. The scale of the challenge is clear when considering the recent sharp worsening of the government’s debt profile and the extent of the action necessary to improve the trend. In recent years, the combined impact on the fiscus of low economic growth, deteriorating tax collection and persistent rapid increases in current expenditure has been significant. As the budget deficits have continuously disappointed, with new borrowings having soared as a result, the government has become more indebted: in the past year alone, its projected debt-to-GDP ratio has jumped f...

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