THE UGLY

Finweek English Edition - - IN BRIEF - “The sources of South Africa’s growth prob­lems are chronic as well as nu­mer­ous, chief among which are in­ad­e­quate hu­man and phys­i­cal in­fra­struc­ture, a rigid and strike-prone labour mar­ket and the widest in­come gaps in the world.”

Fi­nance min­is­ter Nh­lanhla Nene an­nounced the first in­crease in in­come taxes on in­di­vid­u­als for the first time in 20 years and added a whop­ping 81c levy on a litre of petrol. While in­di­vid­u­als will bear the brunt of gov­ern­ment’s at­tempts to fix its fi­nances, it seems un­likely that Nene will be able to con­tain run­away state spend­ing. He also took his time to ad­dress the cri­sis at the South African Rev­enue Ser­vice (Sars), which has been plagued by an ex­o­dus of se­nior staff and se­ri­ous al­le­ga­tions of mis­con­duct. − Kristin Lin­dow, se­nior vice pres­i­dent at rat­ings agency Moody’s in a re­port on the coun­try’s bud­get. Un­less South Africa can im­prove gov­ern­ment’s fi­nances, fur­ther debt rat­ings down­grades to junk sta­tus are likely.

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