{"id":52336,"date":"2026-03-11T06:18:37","date_gmt":"2026-03-11T06:18:37","guid":{"rendered":"https:\/\/eduzim.co.zw\/news\/?p=52336"},"modified":"2026-03-11T06:18:37","modified_gmt":"2026-03-11T06:18:37","slug":"2026-03-11-treasury-says-debt-has-peaked-now-the-test-is-delivery","status":"publish","type":"post","link":"https:\/\/eduzim.co.zw\/news\/2026\/03\/11\/2026-03-11-treasury-says-debt-has-peaked-now-the-test-is-delivery\/","title":{"rendered":"Treasury says debt has peaked. Now the test is delivery \u2013 The Mail &#038; Guardian"},"content":{"rendered":"<p> <script data-jetpack-boost=\"ignore\" async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1669381584671856\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- Africa tv video display -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-1669381584671856\"\r\n     data-ad-slot=\"3579572842\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script data-jetpack-boost=\"ignore\">\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><br \/>\n<\/p>\n<div>\n<div class=\"post-thumbnail \"><img data-recalc-dims=\"1\" width=\"640\" height=\"426\" src=\"https:\/\/i0.wp.com\/eduzim.co.zw\/news\/wp-content\/uploads\/2026\/03\/Treasury-says-debt-has-peaked-Now-the-test-is-delivery.jpg?resize=640%2C426&#038;ssl=1\" class=\"attachment-large size-large wp-post-image\" alt=\"Honourable Finance Minister, Enoch Godongwana\" decoding=\"async\" fetchpriority=\"high\" srcset=\"https:\/\/eduzim.co.zw\/news\/wp-content\/uploads\/2026\/03\/Treasury-says-debt-has-peaked-Now-the-test-is-delivery.jpg 1000w, https:\/\/mg.co.za\/wp-content\/uploads\/2026\/03\/Honourable-Finance-Minister-Enoch-Godongwana-400x266.jpg 400w, https:\/\/mg.co.za\/wp-content\/uploads\/2026\/03\/Honourable-Finance-Minister-Enoch-Godongwana-768x512.jpg 768w, https:\/\/mg.co.za\/wp-content\/uploads\/2026\/03\/Honourable-Finance-Minister-Enoch-Godongwana-600x400.jpg 600w, https:\/\/mg.co.za\/wp-content\/uploads\/2026\/03\/Honourable-Finance-Minister-Enoch-Godongwana.jpg 1330w\" sizes=\"(max-width: 800px) 100vw, 800px\"\/><\/div>\n<p>Honourable Finance Minister, Enoch Godongwana<\/p>\n<p>In an interview with the Mail &amp; Guardian, Finance Minister Enoch Godongwana explains why stabilising South Africa\u2019s debt marks a turning point for the fiscus and why rail reform, infrastructure delivery and fiscal discipline will determine whether the shift can be sustained.<\/p>\n<p>Finance minister Enoch Godongwana says South Africa\u2019s debt trajectory has reached a turning point, but whether that shift holds will depend on faster infrastructure delivery, rail reform and continued fiscal discipline. In a one-on-one interview with the Mail &amp; Guardian after Standard Bank\u2019s annual Budget Forum in Johannesburg on Tuesday, Godongwana said stabilising the country\u2019s debt marks an important milestone for the fiscus, but warned that sustaining it will depend on growth and execution rather than fiscal policy alone.<\/p>\n<p>For Godongwana, the significance of stabilising the debt ratio is not simply a technical fiscal milestone. It determines how much of the national budget can be directed toward services and investment rather than interest payments.<\/p>\n<p>\u201cWhat does high debt mean for South Africans?\u201d he said, pausing briefly before explaining.<\/p>\n<p>\u201cHigh debt means government is taking more money from taxes \u2014 which taxpayers pay \u2014 to service the debt. The effect of that is it crowds out the spending government should have done to pay for schools, education, health and so on.\u201d<\/p>\n<p>\u201cSo when debt peaks,\u201d he continued, \u201cit means we have reached a point where we have contained it. Moving forward, debt is going to go down, and there will be more money available to pay for basic services for our people.\u201d<\/p>\n<p>Treasury\u2019s projection that the debt ratio stabilises this fiscal year marks a shift from more than a decade of steady deterioration. Borrowing rose sharply after the global financial crisis and accelerated again during the Covid pandemic, pushing debt service costs to one of the fastest growing components of public spending.<\/p>\n<p>But earlier at the forum, Godongwana cautioned against interpreting the moment as a fiscal victory.<\/p>\n<p>\u201cOur target was the year in which we were to reach the peak, not the number,\u201d he said.<\/p>\n<p>The point, he argued, is direction rather than precision. Whether the ratio peaks slightly higher or lower matters less than whether the country can sustain a downward trajectory over time.<\/p>\n<p>That trajectory, however, depends on growth.<\/p>\n<p>When asked which reform could lift economic growth most quickly, Godongwana did not reach for a sweeping programme of structural change. Instead, he pointed to a specific constraint.<\/p>\n<p>\u201cFor now, the major constraint is rail.\u201d<\/p>\n<p>The answer reflects Treasury\u2019s reading of the current economic landscape. South Africa\u2019s growth prospects remain closely tied to commodity exports.<\/p>\n<p>\u201cIt is important to select rail in this particular context because there is a commodity boom,\u201d he said.<\/p>\n<p>\u201cIn the context of a commodity boom, if we do not have sufficient rail to transport goods to the ports, mining will not perform better.\u201d<\/p>\n<p>The constraint is therefore not geological. It is logistical.<\/p>\n<p>\u201cCommodities are one of the main beneficiaries of the boom, but without rail capacity, we cannot take full advantage of it.\u201d<\/p>\n<p>Freight rail inefficiencies have limited export volumes in recent years, weakening one of the economy\u2019s most important growth channels. When trains do not move at capacity, commodities cannot reach ports quickly enough, reducing export earnings and narrowing the revenue base that supports fiscal consolidation.<\/p>\n<p>Rail reform has therefore become central to the government\u2019s economic strategy. Allowing greater private sector participation in freight corridors, improving operational efficiency and stabilising Transnet\u2019s finances are all seen as critical steps in restoring export capacity.<\/p>\n<p>At the forum, Godongwana framed the challenge more broadly.<\/p>\n<p>\u201cMacroeconomic stability on its own is a necessary but insufficient condition,\u201d he said.<\/p>\n<p>Stabilising debt helps lower borrowing costs and reduces the country\u2019s risk premium in global markets. But stability alone does not generate growth. Structural reforms must unlock the supply side constraints that have held the economy back.<\/p>\n<p>Rail sits at the centre of that agenda because of its direct connection to export revenue and industrial activity. Infrastructure delivery more broadly is the second test of credibility.<\/p>\n<p>Over the next twelve months, what should South Africans expect to see that looks different?<\/p>\n<p>\u201cMore work on the ground,\u201d Godongwana said.<\/p>\n<p>\u201cRoads, stop and go construction where people are building roads, more construction of schools and clinics. That is what we expect to see over the next year, as well as housing.\u201d<\/p>\n<p>The emphasis on visible construction reflects a longstanding weakness in South Africa\u2019s public investment cycle. Infrastructure budgets have often been undermined by procurement delays, underspending and uneven capacity within municipalities.<\/p>\n<p>Allocations announced in budget speeches have not always translated into projects on the ground.<\/p>\n<p>\u201cWhy am I confident?\u201d he asked.<\/p>\n<p>\u201cIt is because we are putting checks and balances in place to monitor that it does, in fact, happen.\u201d<\/p>\n<p>Improving oversight of infrastructure spending has therefore become central to sustaining confidence in the fiscal framework. Without visible delivery, stabilisation risks appearing technical rather than transformative.<\/p>\n<p>The global environment complicates that effort. Just days after the Budget was tabled, the United States and Israel launched strikes on Iran, sending oil prices higher and highlighting how quickly geopolitical shocks can reshape economic assumptions.<\/p>\n<p>Asked how sustained fuel price increases would affect the government\u2019s growth outlook, Godongwana acknowledged the vulnerability.<\/p>\n<p>\u201cMy team is building a scenario plan to assess the implications, depending on the extent of the problem,\u201d he said.<\/p>\n<p>\u201cBut let me state what is given. Insofar as fuel is concerned, we are a price taker because we are not a producer of gas or oil.\u201d<\/p>\n<p>South Africa imports its fuel and therefore absorbs global price movements.<\/p>\n<p>\u201cFor that reason, we are a price taker. Therefore, it is likely to have serious implications for us if the situation remains unresolved.\u201d<\/p>\n<p>Higher oil prices feed into inflation, which in turn influences interest rate decisions and borrowing costs across the economy. Slower growth would weaken revenue projections and place additional pressure on the debt trajectory Treasury has outlined.<\/p>\n<p>During his remarks at the forum, Godongwana recalled how quickly global events can disrupt fiscal planning.<\/p>\n<p>\u201cIn 2022 I delivered the Budget,\u201d he said.<\/p>\n<p>\u201cI woke up the next morning and Dr Pieterse says, Minister, your numbers are gone.\u201d<\/p>\n<p>Russia\u2019s invasion of Ukraine had altered market conditions overnight.<\/p>\n<p>\u201cThat is the environment in which we operate,\u201d he said.<\/p>\n<p>Domestic political pressure adds another layer of complexity.<\/p>\n<p>\u201cThere is always going to be political pressure to spend more,\u201d Godongwana acknowledged.<\/p>\n<p>Asked how firmly he would defend the government\u2019s spending limits, he framed the challenge as collective rather than personal.<\/p>\n<p>\u201cYou cannot win that battle alone,\u201d he said.<\/p>\n<p>\u201cThe literature I have read on public finances suggests that you need to have the state on your side. Secondly, you need to win your Cabinet colleagues over so they understand the constrained environment in which all of you are operating.\u201d<\/p>\n<p>Fiscal discipline therefore depends on Cabinet alignment and institutional consensus. Debt stabilisation reduces the urgency of deterioration, but it does not remove competing demands for expanded spending.<\/p>\n<p>Beyond fiscal consolidation and infrastructure reform, Godongwana also pointed to regulatory burdens as a practical constraint on enterprise growth.<\/p>\n<p>\u201cThere are many registration requirements for small businesses, to register for this, to enrol for that, which are not necessary,\u201d he said.<\/p>\n<p>\u201cPeople end up spending more time filling in documents than running their businesses.\u201d<\/p>\n<p>Reducing administrative friction would not require additional public spending, but it could remove barriers to entry in an economy where job creation increasingly depends on small and medium sized businesses.<\/p>\n<p>Taken together, the priorities emerging from the interview reflect the next phase of Treasury\u2019s economic strategy.<\/p>\n<p>Stabilising debt has been the first task. The next will be sustaining growth through infrastructure investment, improving rail capacity so that export sectors can expand and ensuring that the fiscal discipline achieved in recent budgets is maintained.<\/p>\n<p>Deputy finance minister Ashor Sarupen reinforced that broader shift during the forum discussion, describing the national budget less as a set of numbers than as a signal of credibility.<\/p>\n<p>\u201cFor the longest time our fiscal narrative was dominated by deterioration \u2014 rising debt, rising debt service costs and narrowing space for investment,\u201d he said.<\/p>\n<p>\u201cThe national budget, at its core, ultimately, is a credibility document. It tells the markets whether we understand the binding constraints in our economy. It attempts to demonstrate to business whether our policies are coherent and it attempts to tell households whether government is serious about stability.\u201d<\/p>\n<p>Sarupen said the past three budgets have begun to shift that narrative.<\/p>\n<p>Investor confidence has strengthened, borrowing costs have declined and macroeconomic stability has become more entrenched. But he cautioned that stabilisation alone will not deliver prosperity.<\/p>\n<p>\u201cStabilisation is not the destination, it\u2019s the platform,\u201d he said.<\/p>\n<p>\u201cWe are not trying to stabilise our way to prosperity. We know that we must grow there.\u201d<\/p>\n<p>Treasury\u2019s projection that the debt ratio has reached its peak now shifts the debate from deterioration to execution.<\/p>\n<p>Whether that turning point holds will depend on rail reform restoring export capacity, infrastructure programmes translating into visible construction and government maintaining fiscal discipline in a volatile global environment.<\/p>\n<p>The numbers may have stabilised.<\/p>\n<p>What matters now is whether the reforms behind them take hold.<\/p>\n<p>Godongwana left the event to travel to London later on Tuesday for meetings with investors, part of Treasury\u2019s effort to reinforce confidence in South Africa\u2019s fiscal trajectory and the reforms aimed at unlocking growth.<\/p>\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\">\n<p>\n<iframe loading=\"lazy\" title=\"Interview with Enoch Godongwana\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/GT0C9O16Jc8?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/p>\n<\/figure><\/div>\n<p><script data-jetpack-boost=\"ignore\" async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1669381584671856\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- Africa tv video display -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-1669381584671856\"\r\n     data-ad-slot=\"3579572842\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script data-jetpack-boost=\"ignore\">\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><br \/>\n#Treasury #debt #peaked #test #delivery #Mail #Guardian<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Honourable Finance Minister, Enoch Godongwana In an interview with the Mail &amp; Guardian, Finance Minister Enoch Godongwana explains why stabilising&hellip;<\/p>\n","protected":false},"author":1,"featured_media":52337,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[32],"tags":[],"class_list":["post-52336","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mzansi"],"_links":{"self":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts\/52336","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/comments?post=52336"}],"version-history":[{"count":1,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts\/52336\/revisions"}],"predecessor-version":[{"id":52338,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/posts\/52336\/revisions\/52338"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/media\/52337"}],"wp:attachment":[{"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/media?parent=52336"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/categories?post=52336"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/eduzim.co.zw\/news\/wp-json\/wp\/v2\/tags?post=52336"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}