Nation braces for crucial Mid Term Budget as economists warn of growth downgrade

SOUTH Africa's fiscal outlook is once again under the spotlight as Finance Minister Enoch Godongwana prepares to deliver the Medium Term Budget Policy Statement (MTBPS) next month on 12 November.

- ASHLEY LECHMAN

The statement is expected to set the tone for the remainder of the fiscal year, providing updates on growth forecasts, inflation expectations and government spending priorities.

Frank Blackmore, Lead Economist at KPMG, said the upcoming statement would be a critical moment for assessing whether South Africa's economic recovery is on track.

“The focus will be on revising economic growth and inflation forecasts. The growth was predicted at 1.4% for this year and expected to rise to 1.7% in 2027, but this will likely need to be downgraded,” Blackmore said.

According to Blackmore, any downgrade in growth projections will have a ripple effect on the country’s fiscal ratios.