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South African finance minister calls for swift action to avoid IMF

Staff Writer | October 26, 2018
Finance Minister Tito Mboweni said South Africa had to act swiftly on its debt levels to avoid having to turn to the International Monetary Fund for help.
Tito Mboweni
Africa   "That low economic scenario has reduced tax revenues"
Mboweni predicted wider budget deficits and cut growth forecasts in his medium-term budget policy statement on Wednesday, as Africa's most industrialised economy faces a recession, revenue shortfalls and ballooning debt.

"Whether or not you like the IMF, ideologically or practically, it doesn't matter. When you get into a debt trap that's where you end up," Mboweni told lawmakers.

"That low economic scenario has reduced tax revenues. We clearly have a problem."

The Treasury expects government's gross debt to stabilise at 59.6 percent of GDP by 2023/24 from an estimated 55.8 percent in the current year. Tax revenue is expected to underperform significantly in the three years to 2020/21.