Fears of a looming emerging-market debt crisis are growing as currencies including the rand came under pressure against the strengthening dollar this week, with Finance Minister Nhlanhla Nene saying government was "concerned". Speaking to Business Times, Nene stopped short of calling it a crisis but said South Africa had already begun to take steps in relation to its own position. While most of South Africa's "debt is rand-denominated, we are concerned. It is for this reason that, in our engagements at multilateral institutions, we are focusing on the matter," he said. If emerging markets' dollar-denominated debt becomes more expensive to service due to the dollar's strength, some countries could default, and this could have a contagion effect on other emerging markets. Some 10% of South African debt is dollar-denominated. Government's strategic-risk portfolio benchmark limits foreign-currency debt to 15% of the total portfolio, according to the 2018 budget review. Emerging-market n...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as exclusive Financial Times articles, Morningstar financial data, and digital access to the Sunday Times and Times Select.

Already subscribed? Simply sign in below.

Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00.