Calls for a pragmatic and growth-centered Medium-Term Budget Policy Statement
Finance Minister Enoch Godongwana will deliver the MTBPS today.
Image: GCIS
AS Finance Minister Enoch Godongwana prepares to table its Medium-Term Budget Policy Statement (MTBPS), at 2pm today, economists have called for a realistic, growth-focused, and reform-driven approach to address the country’s persistent economic challenges and set a foundation for sustainable economic recovery.
Chifipa Mhango, the Chief Economist of Don Consultancy Group (DCG), said the country's economy continued to face significant headwinds including sluggish growth, fiscal constraints, rising debt levels, energy supply instability, and high unemployment.
He emphasized that the upcoming MTBPS presents a critical opportunity for the government to reaffirm its commitment to fiscal consolidation while prioritizing measures that stimulate productive investment and inclusive growth.
“The MTBPS must strike a careful balance between fiscal discipline and growth stimulation,” Mhango said. “This means prioritizing spending that enhances productivity such as infrastructure investment, industrialization incentives, and energy security while managing recurrent expenditure efficiently to contain debt.”
Mhango further cautioned that over-reliance on consumption-based spending and continuous bailouts of state-owned enterprises without structural reform continue to undermine investor confidence. He urged the National Treasury to channel limited resources toward catalytic sectors that can drive job creation, exports, and industrial value-chain development.
“South Africa’s economic recovery depends on targeted structural reforms, particularly in the energy, logistics, and manufacturing sectors,” he added. “Fiscal support must be complemented by policy certainty and a regulatory environment that encourages private-sector participation.”
Mhango also called for a medium-term growth framework anchored in green industrialization, regional trade integration, and digital economy investment. He noted that sustainable growth will require aligning fiscal policy with industrial policy and social protection mechanisms that support vulnerable households while empowering small and medium enterprises (SMEs) as growth enablers.
“A forward-looking MTBPS must not only stabilize the fiscus but also set a clear path toward economic transformation, employment creation, and competitiveness. South Africa needs a decisive shift from short-term fixes to long-term economic sustainability,” said Mhango.