A Difficult Economic Year Ahead – Treasury
Written by Mfundo on 4 May, 2021
By: Bright Ntuli
Government has warned South Africans to expect another difficult year on the economic front because it has to service massive debts.
This warning has been issued by the Treasury as it briefed Parliament’s standing committee on Finance.
Deputy Finance Minister, David Masondo, has conceded that other departments had to accept huge budget cuts.
Masondo says the continued borrowing and increasing debt are having a crippling effect on the economy because it shifts the expenditure from other important budget items, such as infrastructure, to debt service costs.
He says it also cuts out the investment of the private sector since they are borrowing from the same pool, from those services.
Masondo adds that COVID-19 remained at the centre of the current economic situation and the department would be working with other departments in the fight.