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2020/21 Debt Management Report Released

January 13, 2022

National Treasury

National treasury has released the 2020/21 Debt Management Report.

In the foreword, the treasury director-general, Dondo Mogajane, declared that the 2020/21 financial year “came to an end in a volatile environment where global investors feared the rise in United States (US) yields underpinned by inflation expectations driven by a pickup in global growth rates and unprecedented central bank stimulus”.

He added that the Federal Reserve’s “apparent lack of concern about inflation fuelled fears that the US’s interest rates might start to rise faster and earlier than expected”.

On the local front, despite challenges, government was able to meet its gross borrowing requirement of R670 billion with a net issuance of R50.7 billion raised in domestic short-term funding and R518.4 billion in domestic long-term loans.

According to Mogajane, debt service costs “continue to place a great strain on government cash resources, rising at an average of 13.1 per cent per annum at the end of March 2021 and forecast to absorb 20.9 per cent of every rand that the government raises in revenue over the medium-term”.

He emphasized that government aims to manage debt in a way that minimises the impact on the stock of debt and reduces borrowing costs.

The Report focuses on the South African debt capital market; national government’s borrowing requirement and financing; holdings of government debt instruments; government debt portfolio and risk metrics and investor relations.