While the budget delay, driven by disagreements over a proposed VAT increase, initially sparked negative reactions, increased consultation among coalition partners could lead to a more reform-focused budget. The ANC has learned that, unlike in the past, it cannot push policies unilaterally in a coalition government.

With limited fiscal options, addressing corruption and cutting wasteful spending are essential to maximise resources for economic growth. The upcoming Budget on 12 March must reassure investors by prioritising deregulation and private-sector involvement. A budget focused on reform will maintain the positive sentiment that followed the establishment of the Government of National Unity (GNU), which has strengthened the resilience of the ZAR. Conversely, a weak one could erode confidence and the ZAR’s relative resilience.