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Good News: South Africa’s Main Budget Gap at 11.2% of GDP, Beating Forecast

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According to the ministry of finance, South Africa’s main budget deficit for the 2020-21 fiscal year is smaller than previously projected following a report on spending that was below the estimates and an upside revenue surprise.

The economy recorded a shortfall of 551.9 billion rand ($38.1 billion) or 11.2% of gross domestic product, on its main budget for the year through March 2021, according to the National Treasury. That compares with a revised estimate for a gap of 12.3% of GDP that Finance Minister Tito Mboweni presented on Feb. 24, 2021.

This better-than-expected outcome means the deficit on the consolidated budget, which includes total spending by the provinces, social security funds and selected public entities, could be less than the National Treasury’s projection of 14% of GDP.

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