South Africa is seeing weak growth and higher public wage settlements, which imply challenges for the government's promises of reducing budget deficit and stabilizing the debt/GDP ratio.

The government presented a gradual pace of fiscal consolidation than earlier announced in its medium term budget statement. IT revised its expectations up for the consolidated deficit to 3.3% of GDP in 2016/17 and 3.2% in 2017/18.

"The room for any further fiscal slippage is limited", says Nordea Bank. 

Fitch forecasts the gross general government debt (which includes local government) to increase to 51% of GDP at end 2015/16, which is above the 'BBB' range median of 43%.