Government efforts to introduce e-tolling and a high court order stopping it have raised questions about the state’s ability or willingness to guarantee debt, Business Day reported on Monday.
Efficient Group economist Dawie Roodt said the country’s leadership appeared weak and confused, which could have an adverse impact on South Africa’s image as an investment destination.
“People are prepared to pay for tolls, but with conditions. The real issue is we are losing face because clearly the politicians are not in charge here. It’s very bad for SA’s image,” he said.
Financial services group Nomura emerging market economist Peter Attard Montalto told the publication the struggle to implement e-tolling would create a precedent that undermined parastatal policy, and managing the problems would add costs to the fiscus.
Montalto said state would have to use funds meant for other parastatals to bail out the SA National Roads Agency Limited.
He said the problem was with the R20 billion debt incurred by improving Gauteng’s highways
“Consequently, if a payment is missed… the toll-side debt accelerates. Government would have to then pay around R19 billion to finance that side of Sanral’s balance sheet,” said Montalto.
If the government had to guarantee the debt, “budget reserves would be fully consumed at the start of the fiscal year and add yet another risk to the deficit”, he told the newspaper.