THE BRIEF | 25 February 2026 | 12:00 PM SAST

SOUTH AFRICA | KEY DEVELOPMENTS

Budget 2026 Delivered Under GNU Strain and Debt Plateau Signals
Finance Minister Enoch Godongwana is set to table the 2026 National Budget at 14:00 in Cape Town, with expectations of fiscal consolidation rather than aggressive revenue measures. Early reporting indicates government debt may be nearing a peak after nearly two decades of expansion, supported by expenditure restraint and commodity-linked revenue gains. Growth forecasts remain subdued at roughly 1.5–2%, well below the threshold required to materially reduce unemployment near 32%. The rand traded firmer around R18.20/$ in morning activity, reflecting short-term global risk appetite rather than structural domestic reform momentum. Internal Government of National Unity consultations reportedly shaped the draft framework, following last year’s VAT-related tensions. Markets are looking for fiscal credibility and policy coherence ahead of local elections; failure to entrench debt stabilisation could reverse recent equity gains and erode investor confidence, particularly if bracket creep effectively tightens the tax burden without explicit rate increases.
Broken by: Bloomberg – https://www.bloomberg.com ; Business Day – https://www.businesslive.co.za ; SASSA – https://www.sassa.gov.za

AFRICA | KEY DEVELOPMENTS

Multilateral Financing Push Reshapes Sovereign Risk Landscape
African sovereigns are increasingly leveraging multilateral institutions to mitigate elevated debt distress risks affecting more than 20 countries, according to IMF-linked assessments. S&P Global Ratings analysis highlighted revised capital adequacy criteria that may unlock an estimated $90–120 billion in additional lending capacity via highly rated multilateral development banks. Funding costs have eased by roughly 100 basis points to an average near 7.7%, and seven sovereign upgrades were recorded last year. Nigeria has been cited as a reform-positive case despite heavy debt-servicing pressures, while Senegal and Mozambique remain under strain amid policy slippage and external shocks. Selective access to concessional capital can stabilise vulnerable economies, but without structural fiscal anchors—such as formal debt rules—gains risk being cyclical rather than transformative, particularly as global liquidity conditions tighten.
Broken by: Reuters – https://www.reuters.com ; IMF – https://www.imf.org ; World Bank – https://www.worldbank.org

WORLD | KEY DEVELOPMENTS

Trump State of the Union Emphasises Growth Narrative Amid Tariff Friction
In Washington overnight, President Donald Trump delivered his 2026 State of the Union address, projecting economic resilience marked by record equity levels, renewed industrial investment, and declining headline inflation. NPR published transcript and annotated fact-check coverage, noting disputed claims regarding tariff revenues, border enforcement, and foreign policy outcomes. Concurrently, Reuters reported U.S. consumer confidence rising to 91.2 in February from 89.0, though perceptions that jobs are “hard to get” climbed to a five-year high of 20.6%, underscoring labour-market fragility. Housing price growth moderated to roughly 1.8% year-on-year. In Latin America, tensions escalated after U.S. visa sanctions targeting Chilean officials over a Chinese-linked subsea cable project, reinforcing Washington’s strategic posture toward Beijing’s regional footprint. Markets are parsing political messaging against underlying consumption and labour indicators; tariff persistence risks inflation pass-through effects that could complicate monetary policy just as election-cycle positioning intensifies.
Broken by: NPR – https://www.npr.org ; Reuters – https://www.reuters.com ; CNBC – https://www.cnbc.com

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