Lesetja Kganyago, the governor of the South African Reserve Bank, has urged emerging markets, including South Africa, to consolidate their fiscal positions in order to reduce exchange rate pass-through pressure on inflation and its wide-ranging economic costs.
- He stated that “persistent fiscal dissaving” is a constraint to growth from a macroeconomic perspective.
- Kganyago’s comments come in the context of South Africa’s ongoing economic struggles, which have been exacerbated by the Covid-19 pandemic.
- South Africa’s government debt has grown significantly over the past few years, and that the country is facing a range of economic challenges, including high unemployment and slow growth.
- Kganyago’s comments have been widely reported in the South African media, with many commentators praising his call for fiscal consolidation.
- Kganyago has been a vocal critic of South Africa’s government in the past, particularly on issues related to fiscal policy. Kganyago’s comments reflect a broader trend toward greater fiscal conservatism among policymakers in emerging markets.