The report explores:
- The medium-term GDP growth outlook for SA
- The growing fiscal deficit and the likelihood of a debt trap
- The ability of the ZAR to sustain its current strength
- The future performance of SA equity markets
Key takeaways:
- Government expenditure is projected to reach 41.9% of GDP by the end of 2020/21.
- Government revenue is forecast at 26.3%.
- Budget deficit projections
- the National Treasury forecasts a deficit of 15.7% for 2020/21; 8.6% for 2022/23.
- the CRA forecasts a deficit of 17% for 2020/21; 10% for 2022/23.
- The labour market absorption rate is 37.5% — a far cry from global norms of around 60% to 70%.
- The Rand may hold its current levels or strengthen but is likely to weaken in the medium-to-long term.