CAPE TOWN – The director-general of the National Treasury Dondo Mogajane said on Thursday that he had spoken with all three major credit rating agencies to clarify elements of the Medium-term Budget Policy Statement, which was delivered by Finance Minister Tito Mboweni on Wednesday.
“Yesterday we engaged with Moody’s and S&P (Global Ratings). This morning we were engaged with Fitch Ratings… Later on they will issue their own opinions,” Mogajane told reporters on Thursday.
Minister Mboweni’s maiden budget highlighted cutting growth forecasts and raising deficit assumptions, sending the rand and bonds lower.
The MTBPS has also been described as one that provided clear links between the medium-term expenditure statement on the one hand and, on the other hand, President Cyril Ramaphosa’s five growth enhancing reforms.
Sanlam Investments economist Arthur Kamp said on Thursday that the government’s intention to get things going had not led to a boost in the overall level of spending. “Rather, the National Treasury has stuck closely to its expenditure ceiling despite the increased wage bill and additional payments to state-owned enterprises.
“It is also clear Minister Mboweni intends to promote accountability and good governance, while spending available resources more wisely and efficiently. To back this up the Statement emphasised the need to bolster capital expenditure, while curbing consumption.”
Additional reporting by Sizwe Dlamini.
REUTERS AND BUSINESS REPORT ONLINE