Star 2025-05-22

The highlight of the interaction between the media and Team Treasury (including the South African Reserve Bank (SARB) deputy governor and the South African Revenue Service (SARS) commissioner) was the thanks that Treasury Director General Duncan Pieterse expressed to his colleagues in the Treasury. Not only did the Treasury have to deal with three iterations of the Budget, but at the same time, they had to manage the hosting of the Finance Track of the G20, as well as running scenarios of what the impact of an erratic and frequently changing US tariff regime meant for exports and global growth. The impact of this is visible in the growth projections between the February and May iterations of the macro-economic forecasts. Economic growth in 2025 for the world and South Africa…

South Africa's public debt is set to surge to unprecedented levels in relation to gross domestic product (GDP) over the 2025/26 fiscal year. This comes as the national government will be borrowing an average of R1.6 billion per day on the back of rising spending demands and insufficient additional revenue. According to the Budget Review 2025 documents released on Wednesday, the gross borrowing requirement for the government has increased from R579 billion at the time of the 2024 Budget to R588.2bn in 2025/26. This means that the government's borrowing requirements will see Treasury going to the market to raise at least R1.61bn everyday of the year, up from a daily average of R1.58bn. The National Treasury said this borrowing requirement will be financed through a combination of domestic short- and…

Minister of finance warns of additional tax measures in the future Finance Minister Enoch Godongwana has proposed an inflation-linked increase to the general fuel levy in a bid to increase revenue to protect and bolster frontline services, and he has warned of additional tax measures in the future. This move comes after the tax proposals, including a VAT increase of 1%, announced on March 12, came under fire politically and were scrapped. Godongwana said in the context of weaker-than-anticipated global and domestic economic growth, additional revenue and expenditure measures are required to stabilise the public finances. During his third budget speech this year, Godongwana said that for the 2025/26 fiscal year, this is the only new tax proposal that he is announcing. "This is the first fuel levy increase in…

The financial markets have warmly embraced the tabling of South Africa's National Budget for the third time on Wednesday, with the rand remaining stable below the psychological R18-mark to the US dollar. Wichard Cilliers, director and head of market risk at TreasuryONE, said the rand held steady against the US dollar as the budget speech was delivered without hiccups. “It has been well received and now needs to be passed by Parliament. The implementation of the budget remains key, and we will need to see if the government can actually deliver,” Cilliers said. “The dollar fell for its third straight day of losses, reaching the lowest level in a month. Persistent concerns over the US budget deficit drove the decline, as did market speculation around the Trump administration's support for…

The National Treasury has revised South Africa's growth forecast for 2025/26 fiscal year drastically lower on the back of a weaker global outlook, trade frictions, increased uncertainty, and lower projected investment. Finance Minister Enoch Godongwana told Parliament on Wednesday that since the publication of the Budget Review in March, greater uncertainty and trade fragmentation had contributed to a weaker economic outlook. Godongwana highlighted that South Africa was highly exposed to external volatility as a small open economy dependent on global trade and financial inflows. On the back of heightened trade tensions and elevated policy uncertainty weighing on the global outlook, Godongwana said Treasury had to revise its GDP figures downwards by 0.5 percentage points. "As a result, we now estimate real GDP to grow at 1.4% in 2025. This is…

Eskom was in talks with Treasury on how it would close the revenue gap due to the National Energy Regulator of South Africa (NERSA) only allowing tariff increases well below its three-year request. In the six months ended September 2024, a period in which there was no national load shedding, Eskom’s revenue rose by 15.8% year-on-year to R183.71 billion. This meant its profit before tax grew more than tenfold to R23.03bn from only R2.24bn in the same period in 2023 when load shedding was at its worst. In the 2023/4 financial year, which is the latest available annual report, although Eskom’s 2024/5 financial year ended in March 2025, Eskom’s revenue grew by 14% to R295.8bn due to an 18.7% tariff increase, while sales fell by 3%. Statistics South Africa, in…