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The mini budget
A tough balancing act

The MTBPS (or mini-budget) essentially kicked the can down the road, giving way for tougher decisions to be made at next year’s February 2024 annual budget, and some at a later stage, likely after the national elections. The tone of the budget, at least from a financial market perspective, was reassuring in that despite debt and revenue challenges, fiscal consolidation is still being maintained. 

 

For now, National Treasury is attempting to balance the reality of revenue shortfalls by ensuring unnecessary and unproductive expenditure is curtailed. In doing so, they had to ensure that the messaging in the mini-budget statement was not unduly negative to shake already sensitive investment markets. 

 

We have survived another budget for now. 

Excessive public debt and stagnation remain crippling challenges 

As expected, the budget statement reiterated a stark warning that South Africa could go over the fiscal cliff* by next year if the country does not raise the necessary additional borrowings, whilst simultaneously curtailing expenditure and re-prioritising investing for growth. 

 

Over the years, government finances have severely deteriorated due to rising expenditure and dwindling tax revenues due to weak economic growth. 

The current outlook for South African economy continues to paint a worrying picture for the medium term, with major challenges being: 

 

  • the cumulative effect of power cuts by Eskom 
  • poor performance of the logistics sector (particularly Transnet) 
  • elevated consumer inflation 
  • high interest rates and cost of capital funding 
  • a weaker global environment 

Economic growth is expected to stagnate below 1% this year as activity remains constrained. The real GDP outlook has weakened with growth expected to slow to 0.8% in 2023 despite the good recovery in sectors such as tourism, agriculture, construction, transport and communications. Other key major sectors like mining, manufacturing, telecommunications etc. have been seriously challenged lately and will remain so for the medium term. National Treasury forecasts economic growth to average a modest 1.4% from 2024 to 2026. 

 

With such stagnant growth levels, achieving a fiscal consolidation will undoubtedly remain a major challenge for our country. Adding to this, the political pressures that are pushing for an acceleration of infrastructure investments, greater execution of socio-economic development programmes and greater economic inclusion. 

The slower pace of executing structural reforms has not helped this difficult situation. For our economy to emerge stronger, we need more urgency in these reform implementation plans and higher levels of economic growth. 

The rocky road ahead 

We are worried about the execution on expenditure discipline ahead of tricky elections in 2024. Higher debt service costs and lower revenue base are also a concern. National Treasury estimates that 22.1% of budget spending will go to servicing the debt by 2026. 


Numerous SOEs, including Transnet, require financial support so desperately and urgently. The Director- General of South Africa’s National Treasury reminded us of how long it took for the Eskom debt relief programme to be approved. We think, worryingly, there is a possibility that it takes Transnet longer to get approval from government. Meanwhile, the economy would continue to suffer as a result. A poor performing Transnet and an Eskom that is not operating at optimal scale are stifling growth in other key industries of the economy. 

We conclude that the road to recovery and stability will likely continue to be rocky making it difficult for the National Treasury to meet their targets based on expectations. This has been a worrying trend for us, and potentially other investors in our financial markets. 

A credible scenario of a fiscal cliff is still firmly around. Therefore, investors would require an introduction of solid fiscal anchors to regain confidence of our path towards fiscal discipline and stability 

Darmhik Naicker

Darmhik joined Perpetua as a Risk & Quantitative Analyst Intern in 2026.

He holds a BCom Honours degree in Statistics and Data Science from the University of Cape Town, with a strong foundation in finance, quantitative analysis, and risk management.

Tasha Xinindlu

Tasha joined Perpetua as a Marketing Intern in 2026. 

She has a Business Administration Degree major in Marketing and Entrepreneurship from Tsiba Business School. 

 

Najmeerah Simons 

Najmeerah Simons is the Finance, Risk and Compliance Manager at Perpetua, where she oversees financial management, regulatory compliance, and risk governance across the business.

 

She brings experience from the Auditor General of South Africa, where she has served in various roles over a six-year period. She has also spent two years prior to her time in audit and assurance at an asset management firm where she worked in local, property and global finance divisions. Najmeerah holds a Bachelor of Business Science specialising in Finance and Accounting from the University of Cape Town and is qualified Chartered Accountant (South Africa).

Tasneem Abrahams

Tasneem joined Perpetua as a Finance and Business Trainee in 2025

She has a Business Administration Degree major in Finance and Investments from Tsiba Business School. 

Samantha Edwards

Samantha joined Perpetua as a Client Service Intern in 2025. 

She has a Business Administration Degree major in Finance and Investments from Tsiba Business School. 

Sisipho Jokazi

Sisipho joined Perpetua as a Business Analyst in November 2025. Before joining Perpetua, she spent 6 years at M&G Investments Southern Africa in the Institutional Clients team as an Institutional Client Associate providing client service support on a range of clients. At Perpetua, she is responsible for providing support in the servicing of clients; business development support (assisting in growing client base); components of client account management such as handling investment-related queries, performance analysis, and risk reporting. 

 

She holds a BBA degree and PGDip from TSiBA Business School and Regent Business School respectively. 

Jason Clark

Jason joined Perpetua as an Investment Performance & Risk Analyst. He is responsible for evaluating, measuring, and reporting on the performance and risk of the investment portfolios.

 

He brings experience from Luxcara, a German clean-energy asset manager, and Allan Gray, where he served in various roles over a five-year period. Jason holds Bachelor’s and Honours degrees in Economics from Stellenbosch University and is currently pursuing an MSc at the University of Bath. He also holds the CIPM® designation through the CFA Institute, specialising in investment performance measurement.