Gordhan under pressure to deliver in mini budget speech

Economists and business leaders want to see decisive action to rejuvenate the economy.

Finance Minister Pravin Gordhan delivering his national Budget speech in Parliament on 24 February 2016. Picture GCIS.

JOHANNESBURG - All eyes will be on Finance Minister Pravin Gordhan this afternoon when he delivers his Medium-Term Budget Policy Statement in Parliament.

Economists and business leaders want to see decisive action to rejuvenate the economy when he outlines the government's expenditure plans today.

Economist Muzi Mathema says: "We know since the 2016 February budget, the IMF, World Bank and the Reserve Bank have revised GDP downwards. The minister's perspective on GDP growth will largely affect his perspective as on what the budget target that is set in the February budget figure was. If he revises his GDP downwards, he is not likely to revise his expenditure at the same pace downwards."

Last week, during a trade union conference, Gordhan remained positive about South Africa's economy.

"There is sunshine waiting for all of us, if we do the right things, if we provide the right leadership and be bold enough to make the changes that we need to make in the economy."

The South African Institute of Professional Accountants' Ettiene Retief says this would also be an opportunity for the minister to encourage investors.

"To create some kind of steadying of the economy because there is a lot of banter and political play that are obviously not ideal."

Rating agencies are also expected to watch the Medium-Term Budget Policy Statement closely for signs that authorities remain focused on fiscal strengthening.

Meanwhile the Democratic Alliance has challenged Gordhan to introduce structural reforms to assist the economy.