Cape Town - South Africa will soon owe close to R2trn in debt and if the country is to get a ratings downgrade in December the interest that needs to be paid on these loans will increase significantly, said Finance Minister Pravin Gordhan on Wednesday.



The finance minister was speaking at an ANC youth league meeting that was convened at the University of Cape Town (UCT) ahead of the local government elections that will take place on 3 August.



Gordhan said of the R1.4trn that South Africa would be spending this year, R160bn will be spent on interest earned on debt.

Citizens need to take co-responsibility



One of the biggest challenges South Africa and the world is grappling with is to create an environment where citizens don’t depend too much on their governments, said Gordhan.



“In South Africa, we tend to think the state is going to solve all our problems, but it doesn’t work that way. Citizens need to take co-responsibility.”



Gordhan continued, saying he recently attended a G20-meeting in China where the different nations discussed the inequality gap, the trust gap between elites and citizens and the wealth gap.



“The new challenge the entire world is grappling with is how to bring about inclusive growth. How do we ensure, especially in South Africa, that people are no longer economically marginalised?”



Gordhan said he was aware of the fact that graduates, such as the audience he was addressing, didn’t have immediate connectivity to job opportunities. “But it’s a global problem.”