South Africa's Medium Term Budget Policy Statement

SOUTH AFRICA - In Brief 25 Oct 2017 by Iraj Abedian

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This year's Medium Term Budget Policy Statement (MTBPS) was delivered by Minister Gigaba earlier today. This was of particular interest for a variety reasons. Most importantly, this was Gigaba's maiden budget policy statement, an opportunity to assess his political economy stance. Minister Gigaba was appointed back in March 2017, in a politial environment where suspecions and speculations have been rife about President Zuma's intention to replace the much respected and experienced Minister Gordhan, replacing him with an unexperienced young minister who has been widely implicated in public sector fiscal extractions of the Gupta Family- broadly labelled as the State Capture. Speculations have been rife since March that Gigaba is internal to President Zuma's scheme of "Treasury capture". The Minister has denied the allegations, yet various reports of investigative reports have linked him to the broader Zuma-Gupta abuse of fiscal resources and financail corruption within the public sector.The second reason this year's MTBPS was of interest is the fact that the country's credit rating is bound to be influenced by this Statement. So capital markets had much to be concerned about this Budget Policy Statement. The fact that economic growth in the country has fallen to near zero levels, the Budget Policy of particular interest to assess if Miniser Gigaba would manage the revenue-expenses of the Fiscus to avoid a deepening of fiscal stress within the country. At the same time, the Minister's stand on reviving the economy was keenly awaited.Last, but not the least, reason for interest in this year's MTBPS was the Minister's stance on the nuclear project, a project that is closely...