Economists Warn Gnu Uncertainty Could Threaten Economic Outlook

Economists say recent developments around the Government of National Unity have cast a cloud on the countrys economic future. On Wednesday, the DA voted against the 2025 fiscal framework passed by the National Assembly during a heated session.

Standard Charted Chief Economist for Africa and the Middle East Razia Khan says South Africas economic challenges were already present before recent global market volatility and Donald Trumps tariff announcements.

"Investor sentiment right now is so vulnerable and so much on the back foot in any case because of global developments. But it also means that it isnt necessarily the case that investors are going to look at the GNU in the same way as they once did. The damage is done in a sense," says Khan.

It wouldnt be surprising to see GNU fall apart after DA voted against the Budget: Asanda Ngoasheng ANC Secretary General Fikile Mbalula says the ball is in the DAs court on whether or not they want to stay in the GNU. This comes as the ANC and DA failed to agree on the inclusion of a VAT tax hike in the budget.

The DA has threatened legal action over the fiscal framework that was voted on in parliament.