Cape Town – Finance Minister Enoch Godongwana on Wednesday said the country’s debt burden is stabilising for the first time in nearly two decades, as the economy shows cautious signs of recovery.
The government plans to spend 2.67 trillion rand ($168 billion) in the 2026/27 financial year, including a targeted push to tackle crime following President Cyril Ramaphosa’s decision to deploy the army to dangerous areas, Godongwana said.
“For the first time in 17 years, debt will stabilise and it will continue to fall in the coming years,” Godongwana told parliament in his budget speech.
Africa’s most developed economy has struggled with stubbornly high debt, which hit a record high of nearly 80 percent of GDP.
It is expected to ease to 77.3 percent in 2026/27 and decline further to 76.5 percent the following year, Godongwana said.
In November, South Africa secured its first major credit upgrade in over 16 years after S&P Global lifted the country’s sovereign assessment.
It had also been removed a month earlier from the global money-laundering watchdog’s “grey list” of countries under increased monitoring.
“These are signals of restored credibility, of renewed resilience and of a nation regaining its footing,” Godongwana said, projecting growth of 1.6 percent in 2026.
With fiscal pressures easing, the minister said the government would also step up spending on security, a priority as authorities confront persistently high levels of violent crime.
Spending on peace and security would increase to 291.2 billion rand ($18 billion) by 2028, Godongwana said, in part to fund the deployment of army units alongside police in crime hotspots.
The measure announced by President Cyril Ramaphosa earlier this month was the latest in a series of tough moves by the government to contain rampant crime in the country with one of the world’s highest murder rates, averaging about 60 killings a day.
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Compiled by Betha Madhomu
