The Medium-Term Budget Policy Statement (MTBPS) delivered today by Finance Minister Tito Mboweni, speaks directly to the consequences of poor financial and economic management.
Our country would not find itself knee-deep in debt, with a debt to GDP ratio of 81.8%, if we had adequately prepared during the past few years, sans the difficulties of Covid-19.
South Africans now know where the money will come from to fund the “miracle targets”, as set out by President Cyril Ramaphosa in his recent Economic Reconstruction and Recovery Plan address to the nation.
Government increasing short-term loan borrowing to the amount of R143 billion and long-term borrowing at a rate of R469.9 billion, on average, over the next five years does not bode well for us, nor does it assure international investors that we are capable and able to grow.
The alarming rate at which our country is borrowing to service debt costs means that we run the risk of a debt-trap, which will compromise our sovereignty as a state, as we would be willing to sell off our country to the highest bidder.
While the efforts of Operation Vulindlela are commendable and welcomed, we must ask how this team – which is made up of experts from the private sector – will address the capacity constraints within the national government departments. Further, will there be sustainable skills-transfer to ensure that fiscal responsibility is maintained long after this team leaves our shores?
Continued bailouts of SAA and failing SOEs must stop. We cannot continue to throw money at non-financial restructuring plans.
We must focus our attention on the agricultural sector – as it is already growing, and we as the IFP have been calling for greater emphasis to be placed on this sector.
Our country is in a dire situation and we require immediate action to be taken in order to get us back to work. South Africans should not be given mixed messages.
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Contact:
Inkosi Mzamo Buthelezi, MP
IFP Deputy President and Spokesperson on Finance
072 390 6112