Fitch Pours Cold Water on SA's Budget, Questions Fiscal Slippage on Wages

LOCAL NEWS

• Fitch pours cold water on SA’s budget expressing doubt that the Treasury has the ability to contain govt spending. Fitch noted the improved fiscal position, but noted the Temporary nature of the windfall brings risks of breaching the spending cap on wages and a potential basic income grant ahead of 2024. – Fin24
• Local economists are mixed to positive following yesterday’s budget, saying the plan lacked clarity on specific plans to boost growth. The business-friendly approach was positive, opting to hold off taxation to support the recovery and use the windfall to trim the debt burden. Targeted support to offset youth unemployment was welcomed, but efforts to cut red tape and achieve the 3% growth level needed to turn the tide on unemployment were short on details – EWN
• Political parties voiced concerns over the lack of detail on employment, SA’s growing debt levels and the number of people dependent on social grants and govt support. Tax measures were broadly welcomed - SABC
• BLSA says the bounce-back loan scheme was encouraging and could help the sectors most affected by the pandemic. Particularly hospitality and tourism. – EWN
• Deal for Takatso to become SAA’s new majority owner set to be signed by the end of Feb or next month – hopefully reducing the burden on Govt for consistent bailouts. Takatso will assume 51% of SAA with negotiations in the final stages – Sunday Times