The upcoming national budget to be presented by finance minister Enoch Godongwana months before South Africa’s seventh election, will be very interesting to watch.
There are numerous critical things we must watch in Godongwana’s budget. The numbers on tax revenues over the past year will be interesting. How did South Africa do on revenues over the past year given the blackouts that have harmed economic productivity, and logistical challenges due to Transnet’s collapse.
Eskom’s power supply continues to be a challenge. South Africans deserve to know the financial and reform plans about Eskom.
The kind of budget South Africa needs is a budget that tilts towards investment, not consumption. Investment, along with structural reforms, are what is needed to achieve stronger growth over the long-term. Investment would range from infrastructure investment to human capital investment. Are we going to hear a budget that tilts toward investment from Godongwana?
The International Monetary Fund (IMF) projects that South Africa's economy will grow below the Sub-Saharan Africa average this year. It will be interesting to see how Godongwana’s Treasury sees growth this year. I doubt it will be any different from IMF and World Bank projections.
Economists are concerned that "Government debt could reach 80% of GDP within two years and 90% by the end of the decade, weighing on the economy and the government’s ability to deliver services, economists warned ahead of finance minister Enoch Godongwana’s budget speech”, Business Day has reported.