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Vol 61 No 22

Published 5th November 2020


South Africa

The 'Ramaphosa Compromise'

The medium-term budget is seen by some as a fudge in the struggle between liberalising reform and preserving the state sector

The government has firmly held the line against the left and the labour movement's efforts to defend ailing state-owned enterprises. President Cyril Ramaphosa is also boosting the Zondo commission into state capture. But the compromise recovery plan – and the budget set out to enable it – is a mish mash that won't do enough, pundits say, to avoid incipient default or an International Monetary Fund bail-out. Finance Minister Tito Mboweni emphasised the danger of possible debt default by 2024 as he launched his bleak medium-term budget policy statement on 28 October. Debt already stands at 81% of GDP, and could rise to 95% by 2025.

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