PREVIEW: Tito Mboweni’s mid-term budget

Can the finance minister deliver a budget that is both financially prudent and growth-enhancing? Most analysts say it will be difficult. eNCA's business Editor Devan Murugan has the details #DStv403 #eNCA

JOHANNESBURG - Can Finance Minister Tito Mboweni deliver a budget that is both financially prudent and growth-enhancing?

Analysts say it will be difficult.

READ: Busa: SA doesn't have money for SOEs

There is no economic growth, there is fewer tax-paying businesses and employees, and South Africa is borrowing at dangerous levels.

As recently as July, Mboweni warned that SA's debt to GDP ratio would reach an unmanageable 140% in a decade if we did nothing about it.

But, if we cut spending and curb borrowing, we could stabilise the debt ratio at 87% by 2023.

The problem?

The impact of COVID-19 continues while other obligations have made this desperate task appear overly ambitious, even the president's economic advisory council thinks so.

South African Airways is set to get more than R10-billion, another R6-billion is earmarked for the COVID-19 relief grant extension, and there's R100-billion for a three-year mass employment program, announced by the president.

READ: Opposition to Mboweni: No to bailouts and more taxes

There is also a warning about tax.

Although new tax policy announcements only happen in the February Budget, analysts say the finance minister could hint at potential wealth taxes.

Watch the full report by eNCA's Business Editor Devan Murugan, for more details.

Source
eNCA