South Africa's debt sustainability: A multi-factor approach

Simple item page
dc.contributor.advisorDonaldson, Andrew
dc.contributor.authorBegbie, Lyle
dc.date.accessioned2023-02-23T13:42:37Z
dc.date.available2023-02-23T13:42:37Z
dc.date.issued2022
dc.date.updated2023-02-20T12:17:10Z
dc.description.abstractAn increasing debt-GDP ratio, slow growth, high debt costs and declining credit ratings call into question the sustainability of South Africa's public debt. However, some commentators have drawn on Modern Monetary Theory in arguing that increasing debt can be tolerated for states that have a level of monetary sovereignty. This paper concludes that South Africa has a high degree of monetary sovereignty due to factors including its flexible exchange rate, independent and credible central bank, high level of financial development and private wealth and limited liquidity risk. However, the scope for increasing debt is not unlimited, the risks associated with rising inflation cannot be ignored and the national treasury's fiscal consolidation plan should not be abandoned. South Africa's comparatively strong financial institutions and persistently low global real interest rates allow the fiscal consolidation programme to be implemented gradually without undue disruption to the growth recovery, while avoiding the risk of a debt crisis, hyperinflation, and a sovereign default.
dc.identifier.apacitationBegbie, L. (2022). <i>South Africa's debt sustainability: A multi-factor approach</i>. (). ,Faculty of Commerce ,School of Economics. Retrieved from http://hdl.handle.net/11427/37062en_ZA
dc.identifier.chicagocitationBegbie, Lyle. <i>"South Africa's debt sustainability: A multi-factor approach."</i> ., ,Faculty of Commerce ,School of Economics, 2022. http://hdl.handle.net/11427/37062en_ZA
dc.identifier.citationBegbie, L. 2022. South Africa's debt sustainability: A multi-factor approach. . ,Faculty of Commerce ,School of Economics. http://hdl.handle.net/11427/37062en_ZA
dc.identifier.ris TY - Master Thesis AU - Begbie, Lyle AB - An increasing debt-GDP ratio, slow growth, high debt costs and declining credit ratings call into question the sustainability of South Africa's public debt. However, some commentators have drawn on Modern Monetary Theory in arguing that increasing debt can be tolerated for states that have a level of monetary sovereignty. This paper concludes that South Africa has a high degree of monetary sovereignty due to factors including its flexible exchange rate, independent and credible central bank, high level of financial development and private wealth and limited liquidity risk. However, the scope for increasing debt is not unlimited, the risks associated with rising inflation cannot be ignored and the national treasury's fiscal consolidation plan should not be abandoned. South Africa's comparatively strong financial institutions and persistently low global real interest rates allow the fiscal consolidation programme to be implemented gradually without undue disruption to the growth recovery, while avoiding the risk of a debt crisis, hyperinflation, and a sovereign default. DA - 2022_ DB - OpenUCT DP - University of Cape Town KW - Economics LK - https://open.uct.ac.za PY - 2022 T1 - South Africa's debt sustainability: A multi-factor approach TI - South Africa's debt sustainability: A multi-factor approach UR - http://hdl.handle.net/11427/37062 ER - en_ZA
dc.identifier.urihttp://hdl.handle.net/11427/37062
dc.identifier.vancouvercitationBegbie L. South Africa's debt sustainability: A multi-factor approach. []. ,Faculty of Commerce ,School of Economics, 2022 [cited yyyy month dd]. Available from: http://hdl.handle.net/11427/37062en_ZA
dc.language.rfc3066eng
dc.publisher.departmentSchool of Economics
dc.publisher.facultyFaculty of Commerce
dc.subjectEconomics
dc.titleSouth Africa's debt sustainability: A multi-factor approach
dc.typeMaster Thesis
dc.type.qualificationlevelMasters
dc.type.qualificationlevelMCom
Files
Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
thesis_com_2022_begbie lyle.pdf
Size:
1.95 MB
Format:
Adobe Portable Document Format
Description:
Download
License bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
license.txt
Size:
0 B
Format:
Item-specific license agreed upon to submission
Description:
Download
Collections
Masters