Fitch Ratings, one of the big three ratings agencies on which South Africa depends for its credit rating, has expressed doubt that Treasury has the ability to contain government spending pressures following the tabling of Finance Minister Enoch Godongwana’s maiden budget on Wednesday. Fin24 reports quotes Fitch as saying that even though the country’s revenue overrun of R180 billion over the past fiscal year had improved public finances, South Africa had continued to “breach expenditure ceilings, pointing to difficulties in containing spending”. Fitch also warned that the country’s recent revenue bonanza – due to high commodity prices – will prove temporary and that the country’s problems can really only be solved by economic growth.
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