High commodity prices have given South Africa some breathing room to maintain social spending programs, but long-term fiscal consolidation will require politically challenging structural reforms that the country’s embattled government may be unwilling to undertake prior to 2024 elections. Without those sweeping reforms, high unemployment, inequality and poverty will continue to beset the South African economy. In a speech delivered on Feb. 23, South African Finance Minister Enoch Godongwana outlined the government’s budgetary priorities for the 2022-23 fiscal year while underscoring the country’s unexpected revenue windfalls. Godongwana said that over the past year the South African government generated R182 billion ($12 billion) more revenue from taxes than it had budgeted for -- driven largely by the 2021 surge in global commodity prices, which benefitted the country’s large mining sector. The South African Treasury now has more fiscal room than it had predicted, leading to Godongwana’s generally positive outlook, which also...
