Johannersburg – South Africa’s National Treasury said on Thursday that the recent rebasing of the country’s Gross Domestic Product (GDP) has improved key fiscal indicators, including lowering the government’s previously projected peak debt-to-GDP ratio.
The Treasury said government debt was now expected to peak at 74.6% of GDP in the 2025/26 fiscal year, compared with the 78.4% estimate published in last month’s mid-year budget review.
The revision follows Statistics South Africa’s recent rebasing and benchmarking exercise, which showed that the country’s economy was approximately 5% larger than previously estimated.
The updated GDP figures have also improved the government’s fiscal outlook. The budget deficit for the 2026/27 financial year is now projected at 3.5% of GDP, down from the earlier forecast of 3.7%.
Meanwhile, the primary budget surplus, which excludes interest payments on government debt, is expected to reach 1.6% of GDP in 2026/27 before increasing to 2.8% by 2029/30.
Treasury Director General Duncan Pieterse said the revised forecasts were largely mechanical adjustments resulting from the updated economic data.
However, he noted that the figures demonstrated that the government continued to meet its fiscal targets and was beginning to benefit from lower borrowing costs.
The revised estimates offer South Africa an improved picture of its public finances, although the underlying fiscal position and the country's ability to sustain debt reduction will remain important considerations for investors and policymakers.
Source: Reuters
Reporting: Kopano Gumbi
Editing: Alexander Winning
