South Africa's Grim Economic Reality Shrinks Its Budget Aspirations
MIN READFeb 27, 2020 | 15:47 GMT
Unemployed builders, tilers and plumbers seeking employment stand on the side of a road in Johannesburg soliciting for jobs. The government has revised South Africa's already grim economic outlook downward in its budget review for the 2020 fiscal year.
(GUILLEM SARTORIO/AFP via Getty Images)
South Africa’s newest budget review paints a bleak picture for the country’s economy over the next three years. The budget plan for the 2020 fiscal year, unveiled Feb. 26, projects economic growth over the next three years of just 0.9 percent, 1.3 percent and 1.6 percent, respectively – and this may be optimistic, compared with the International Monetary Fund's projections. The new budget dramatically alters South African expectations in terms of fiscal and debt consolidation over the next year, as it no longer views balancing its primary budget by 2022 as possible. The new budget also attempts to curb years of wage and expenditure growth – setting up more confrontations between the government and labor unions....