Page 28 - TKZN Annual Report 2023/2024

Figure 4: Main budget revenue and expenditure (as % of GDP)
Source: South African National Treasury
The estimated budget deficit for 2022/2023 was R244.7 billion. This reflects a poor employment outlook, with lower wages and job losses resulting in reduced personal income tax collection. The difficult trading environment means less profit for businesses, which lowers corporate tax. Weak household consumption means the State takes in less revenue through VAT.
Government allocates funds to its central policy objectives – reducing poverty and inequality – through the budget. Over the medium term, total consolidated spending is expected to increase nominally, from R2. 4 trillion in 2024/25 to R2. 6 trillion in 2026/27.
In the context of weak growth, however, revenue shortfalls and rising spending pressures are threatening government’s ability to maintain existing levels of service provision and infrastructure investment.
MTBPS, 2023
The MTBPS focuses on strengthening economic growth by improving electricity and rail operations, building investor confidence, attracting new infrastructure investment and speeding up delivery, and reconfiguring the state for efficiency.
The economic outlook over the medium term remains weak, reflecting the cumulative effect of power cuts, the poor performance of the logistics sector, high inflation, rising borrowing costs, and a weaker global environment. Growth is projected to average 1.4 per cent from 2024 to 2026.
The KwaZulu-Natal Socio-Economic Context
KwaZulu-Natal is the third smallest province by land area, but the second most populous after Gauteng, with over 11.9 million people, or 19.6% share of the national population. However, over the 2016-2021 period, the province experienced a net migration of - 83 081 people. It is the second largest contributor to South Africa’s GDP, generating about R952.528 billion in 2021, translating to 15% of the national real GDP.
The province’s economy performs in most spheres, including manufacturing, agriculture, mining, trade, construction, and finance. It has a notable competitive advantage driving tourism in the province. Not only does it boast five ‘blue flag’ beaches along the East Coast, but it is also home to the magnificent Ukhahlamba Drakensberg mountains and the iSimangaliso Wetlands, both World Heritage sites. The province also boasts numerous private and public ‘big five’ game reserves, various battlefields, and Oribi Gorge, which has a 165m swing over the waterfall, hiking trails, cliffs and idyllic picnic sites, among its many attractions.
26 TOURISM KWAZULU-NATAL ANNUAL REPORT 2023/2024