https://newsletter.en.creamermedia.com
Africa|Service|Services
Africa|Service|Services
africa|service|services

Fiscal rule to help steady South African debt, Central Bank says

SARB logo

Photo by Bloomberg

30th September 2025

By: Bloomberg

  

Font size: - +

South Africa risks a debt trap after years of lax budget discipline, but following through with plans for a fiscal rule to control borrowing will put it back on track, the central bank said.

The country’s annual debt-service costs have surged to a projected 18.4% of government spending in the current fiscal year from 8.6% in 2008-09, squeezing out expenditure on essential services and forcing the government to adopt what critics call an austerity budget to stabilise public debt.

The National Treasury has proposed a fiscal anchor to bolster investor confidence that South Africa will stick to its pledge to curb spending. But politicians including Finance Minister Enoch Godongwana have voiced reservations about handing control over public policy to non-elected technocrats.

Adopting a binding fiscal rule, coupled with reforms to galvanise the under-performing economy, “bodes well for South Africa’s goal of inclusive growth and stability in the fiscal framework,” the bank wrote in its September Quarterly Bulletin released on Tuesday.

Failing to act will have consequences. South Africa’s borrowing costs have risen by more than emerging market peers amid investor concerns about debt levels and stagnant growth, it said.

“Higher debt-service cost has also contributed to larger budget deficits, increasing the risk of falling into a debt trap,” the bank said.

South Africa’s current fiscal discipline is provided by running a primary budget surplus, where revenue exceeds non-interest expenditure. But the goal of keeping public debt stable isn’t a legal obligation.

Edited by Bloomberg

Comments

Showroom

Willard
Willard

Rooted in the hearts of South Africans, combining technology and a quest for perfection to bring you a battery of peerless standing. Willard...

VISIT SHOWROOM 
Multotec
Multotec

Multotec, recognised industry leaders in metallurgy and process engineering help mining houses across the world process minerals more efficiently,...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Photo of Martin Creamer
On-The-Air (03/10/2025)
3rd October 2025 By: Martin Creamer
Magazine round up | 03 October 2025
Magazine round up | 03 October 2025
3rd October 2025

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







301

sq:0.065 0.153s - 189pq - 2rq
Subscribe Now