#SpecialBudget2020: Economists react to Mboweni’s supplementary budget

In a recent interview on CNBC Africa, economists Azar Jammine, Director and Chief Economist at Econometrix, and Maarten Ackerman, Chief Economist and Advisory Partner at Citadel, provided their insights and reactions to the emergency budget speech delivered by South African Finance Minister Tito Mboweni. The economists expressed their views on the budget speech, highlighting key points and concerns regarding the country's economic situation. The budget speech, which aimed to address the economic impact of the COVID-19 pandemic and the subsequent relief measures announced by President Ramaphosa, was met with mixed reactions from the experts. Azar Jammine noted that the budget contained no major surprises and was more of a formality to ratify the relief package. He highlighted the importance of reducing the budget deficit and controlling the public debt, emphasizing the need for substantial expenditure cuts to achieve fiscal sustainability. On the other hand, Maarten Ackerman acknowledged the communication and content of the budget speech but raised concerns about the lack of clarity on execution and reforms. He emphasized the importance of implementing structural changes to drive economic growth and avoid a debt spiral. The economists also discussed the challenges faced by state-owned enterprises, such as Eskom and the Land Bank, and the need for governance reforms and strategic decisions to ensure financial stability and long-term sustainability. They expressed reservations about the country's growing debt burden and the reliance on international lenders, urging the government to focus on economic reforms and revenue generation to spur growth. Despite the uncertainties and challenges highlighted in the budget speech, the economists called for decisive action and political will to address the country's economic woes and set it on a path to recovery. Looking ahead, they emphasized the importance of concrete steps, increased transparency, and accountability to restore investor confidence and drive economic progress.