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South Africa’s Finance Minister’s Emergency Covid-19 Budget

The overall message was a grim one on Day 90 of the Covid-19 lockdown, one of the world’s hardest and longest. Debt, said Finance Minister Tito Mboweni, was South Africa’s weakness. Debt service cost has become the fastest-growing item – to R229.3-billion in 2020, according to February’s Budget, up from R201.2-billion in 2019 and R184-billion in 2018. And later, in his 40-minute address, Mboweni reminded South Africa’s debt is already costing much – to date the country spent on debt service costs as much as on Health. Zero-based budgeting was described as the “narrow gate” government would go through as part of the economic recovery road map. It would stabilise the debt at 87.4% of GDP by 2024 and narrow the deficit. Invoking the image of a hippo’s wide-open jaws – to symbolise the gap between income and expenditure – the finance minister said that closing this gap was the Herculean task South Africa faced.