The 2018 national budget was tabled under very difficult economic circumstances. The Minister of Finance acknowledged that difficulty, but necessary trade-offs had to be made to formulate a budget that moderates spending, raises revenues whilst aiming to minimize the potential negative effect on growth.
The 2017 GDP growth projection has been revised upward to 1 per cent, from the 0.7 per cent expected at the time of MTBPS last year. Economic growth is forecasted to be 1.5 per cent in 2018, rising to 2.1 per cent in 2020. However, government still faces a revenue gap of R48.2 billion in the current year. The consolidated deficit is projected to narrow from 4.3 per cent of GDP in 2017/18 to 3.5 per cent in 2020/21.
From an agricultural perspective, Agri SA is particularly pleased that the Minister took time to acknowledge agriculture’s contribution to the country’s economic growth, says Dan Kriek, president of Agri SA.
Unfortunately, once again agriculture received relatively little further attention in this budget as it did in the medium-term budget policy statement (MTBPS) of October last year. This is despite the claims made by the minister that government remains committed to the goals set in the Constitution and the National Development Plan (NDP).