South Africa\u2019s ruling coalition is unlikely to splinter despite differences between the partners over its first budget, Standard Bank Chief Executive Officer Sim Tshabalala said.<\/p>\n\n\n\n
Although the members of the so-called government of national unity are divided over budget policy, the coalition will likely ride out the storm intact.<\/p>\n\n\n\n
\u201cThe base case is that the GNU in South Africa remains and continues to operate,\u201d Tshabalala said in an interview with Bloomberg TV\u2019s Jennifer Zabasajja. \u201cThe evidence in South Africa is that the coalition will subsist.\u201d<\/p>\n\n\n\n
Last year\u2019s national election failed to produce an outright winner, forcing the African National Congress \u2014 which had held a parliamentary majority for three decades after apartheid ended in 1994 \u2014 to seek partners to get it past the 50% threshold needed to form a government.<\/p>\n\n\n\n
Lawmakers called off last month\u2019s budget presentation after the partners refused to back Finance Minister Enoch Godongwana of the ANC over plans to increase value-added tax by two percentage points this year.<\/p>\n\n\n\n
A new proposal presented on March 12 trimmed the increase to 1 percentage point spread over two years.<\/p>\n\n\n\n
Still, the second-biggest party in the coalition, the Democratic Alliance, maintains it won\u2019t support any permanent tax hikes or back the budget in its current form but remains open to further negotiations.<\/p>\n\n\n\n
Standard Bank\u2019s Tshabalala said that such disagreements are normal within governments. He cited Germany \u2014 where a failure to agree on a budget resulted in the collapse of the coalition government \u2014 and the US, where Republicans and Democrats are wrangling over a spending bill to avert a government shutdown on Saturday.<\/p>\n\n\n\n
\u201cIt\u2019s normal in a country that is democratic for these conflicts to happen,\u201d Tshabalala said, adding that the parties will likely seek a consensus on the budget.<\/p>\n\n\n\n
He said the VAT proposal was \u201ccreative and careful\u201d because it sought to ensure the government was able to generate much-needed revenue, without subjecting businesses and workers to higher income taxes.<\/p>\n\n\n\n
He said the government\u2019s commitment to reducing its debt to 76.2% of gross domestic product over the next year surpassed estimates from ratings companies, showing authorities\u2019 focus on revenue and cost management.<\/p>\n\n\n\n
\u201cThe big question, of course, is \u2018will the budget pass? Will it be supported by the GNU,\u2019\u201d Tshabalala said. \u201cI don\u2019t know. We will see.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
South Africa\u2019s ruling coalition is unlikely to splinter despite differences between the partners over its first budget, Standard Bank Chief Executive Officer Sim Tshabalala said.<\/p>\n","protected":false},"author":59,"featured_media":790595,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[20008,15790],"class_list":["post-816854","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-government-of-national-unity","tag-sim-tshabalala"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/816854","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=816854"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/816854\/revisions"}],"predecessor-version":[{"id":816855,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/816854\/revisions\/816855"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/790595"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=816854"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=816854"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=816854"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}