South Africa Debt Set to Stabilise After 17 Years, Finance Minister Says

South Africa’s debt burden is expected to stabilise for the first time in nearly two decades, Finance Minister Enoch Godongwana announced on Wednesday, describing the development as a turning point for the country’s public finances.

Presenting the national budget in parliament, Godongwana said government debt, which has climbed sharply over the past 17 years, has now reached a peak and will begin to decline gradually in the coming years.

The country’s debt level, which approached 80 percent of gross domestic product at its highest point, is projected to ease to 77.3 percent in the 2026 to 2027 financial year and fall further to 76.5 percent the year after.

Godongwana said the improvement reflects fiscal discipline and efforts to rebuild investor confidence. He pointed to recent gains in the country’s international standing, including a sovereign credit rating upgrade by S&P Global in November, the first significant upgrade in more than 16 years. He also noted South Africa’s removal from the grey list of the global financial crime watchdog as further evidence of renewed credibility.

Alongside efforts to stabilise public finances, the government announced plans to increase spending on peace and security. Total expenditure is expected to reach 2.67 trillion rand in the 2026 to 2027 fiscal year. Funding for security services will rise to 291.2 billion rand by 2028, supporting the deployment of the army alongside police in high crime areas.

Authorities continue to grapple with high levels of violent crime, with an average of around 60 killings reported daily. The increased allocation is aimed at strengthening law enforcement capacity and improving public safety.

The finance minister projected economic growth of 1.6 percent in 2026, signalling cautious optimism that Africa’s most industrialised economy is on a gradual path to recovery.

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