BUSA CEO Khulekani Mathe highlights collaboration between the public and private sectors as central to South Africa’s exit from the FATF grey list.
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SOUTH AFRICA'S organised business sector, BUSA, has welcomed the 2026 national Budget, praising its fiscal discipline and reform momentum, but stated that South Africa’s modest growth outlook remains insufficient to tackle unemployment.
In a statement released following the Budget Speech, BUSA said the Budget tabled by Finance Minister Enoch Godongwana reflects steady progress in stabilising the country’s public finances, even as deeper structural challenges persist.
BUSA also pointed to several positive developments underpinning the fiscal framework, including South Africa’s removal from the Financial Action Task Force grey list, an improvement in the country’s credit rating outlook, a stabilising debt trajectory, a narrowing budget deficit, and lower borrowing costs.
BUSA CEO Khulekani Mathe said that the Budget highlights important progress, including South Africa’s removal from the FATF grey list, a credit rating upgrade, the stabilisation of debt, anarrowing budget deficit, and easing borrowing costs.
Budget 2026
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Mathe added that South Africa’s removal from the FATF grey list was especially significant, noting that it was achieved through sustained and coordinated efforts across multiple government departments and agencies, working closely with the private sector.
“These developments are worthy of recognition because they demonstrate what is achievable when the country concentrates on the right priorities and works together,” said Mathe.
Treasury forecasts gross domestic product growth of 1.6% in 2026, rising gradually to 2.0% by 2028. While BUSA described this as a sign that the economy may be turning a corner, it warned that the pace of expansion remains insufficient to absorb the country’s large pool of unemployed people.
BUSA said sustaining fiscal stability and accelerating reforms would be essential to strengthening investor confidence and unlocking faster growth and job creation.
It also welcomed the absence of unexpected tax increases, saying improved tax administration and spending reviews had enabled the government to close a previously anticipated R20 billion funding gap for the 2026/27 financial year without raising taxes.
Among the measures supported by business are inflation-related adjustments to personal income tax brackets, an increase in the VAT registration threshold, and a higher capital gains exemption for small business sales steps, BUSA said, would ease financial pressure on households and firms.
BUSA endorsed the four pillars of the fiscal strategy outlined by the National Treasury: supporting economic growth, improving the efficiency of public spending, shifting expenditure towards capital investment while containing the public service wage bill, and entrenching sustainable public finances through a principles-based fiscal anchor.
According to the organisation, early signs suggest this approach is beginning to yield results.
However, it warned that national progress risks being undermined by deteriorating service delivery at the municipal level. Failing infrastructure, water outages, potholes, sewage spills, and malfunctioning traffic lights continue to impose costs on businesses and communities, the group said.
“Dry taps, potholes, sewage running through the streets, and non-functional traffic lights have become daily occurrences that erode confidence and undermine the positive narrative of a country on the mend,” Mathe said.
BUSA also revealed that the Budget aligns closely with priorities announced in the President’s State of the Nation Address, including increased allocations for early childhood development, funding to combat organised crime and gangsterism, the employment of additional doctors, and renewed investment in infrastructure.
The alignment between policy commitments and fiscal allocations signals improved coordination within government, the organisation said, but stressed that implementation will ultimately determine success.
It also acknowledged progress in structural reforms in energy, transport, and logistics under Operation Vulindlela, where collaboration between government and business has intensified. Expanded private-sector participation and the development of public-private partnerships are seen as key to unlocking growth in these sectors.
“Business stands ready to support measures aimed at growing the economy, boosting investment and accelerating job creation,” Mathe said.