South Africa has raised its financing requirements for the current fiscal year by $3.3 billion, primarily to fund a domestic bond buyback programme aimed at reducing the concentration of debt repayments in coming years and easing overall debt management.
According to the Medium-Term Budget Review released on Wednesday, 21 October, in Cape Town, the National Treasury now projects financing needs of $26.4 billion for the fiscal year ending March 2027, up from the $23.1 billion estimated in February.
Despite the upward revision, the figure remains below the $33.5 billion raised in the previous fiscal year.
The increase is primarily intended to fund the early repurchase of bonds issued in the domestic market. Through this operation, the government aims to reduce the volume of debt falling due in specific periods, redistributing maturities more evenly over time.
The programme is expected to launch within the current fiscal year, with the selection of bonds to be repurchased dependent on prevailing market conditions.
The Treasury indicated that public debt repayments are projected to average $15.2 billion per year over the medium term, underscoring the need to actively manage the bond maturity profile.
To partially cover its financing requirements, the government also plans to draw on approximately $670 million in available cash balances.
On the foreign-currency financing side, the government estimates raising approximately $15.5 billion over the medium term, equivalent to around $5 billion per year, also drawing on the state’s foreign exchange reserves.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/?p=554557
