President Cyril Ramaphosa has warned that the surge in international oil prices, driven by the US-Israel war on Iran, is expected to continue negatively affecting South Africa’s economy.

Ramaphosa was tabling the Presidency’s budget vote for the 2026/27 financial year in the National Assembly on Tuesday, where he identified inflation and the rising cost of living as the issues most affecting people’s livelihoods.

“The effects of the surge in oil prices and other critical supplies like fertiliser are likely to undermine much of the progress that we have made in bringing down inflation and the cost of living. Together with disruption to the global economy, these developments are likely in the medium term to slow down our economic growth and to hamper our efforts to create jobs. We should anticipate that conditions will be difficult for the next while,” Ramaphosa said.

Despite the global headwinds, the President said South Africa’s economic outlook had improved in recent years.

“Following years of challenges, our economy is on the mend. The macroeconomic environment has improved, tax collection revenues remain strong, public finances are in better shape and national debt has stabilised,” Ramaphosa told Parliament.

He noted that ratings agency Moody’s had recently upgraded South Africa’s outlook from stable to positive, while S&P had lifted the country’s credit rating for the first time in two decades.

Ramaphosa said the sixth South Africa Investment Conference, held in March, had secured investment pledges in excess of R890 billion across various sectors, with a substantial portion coming from domestic investors.

“When local investors show confidence in the prospects of the economy, international investors follow suit,” he said.

The President announced that government had embarked on what he described as the largest infrastructure build programme in the country’s history, with R1 trillion to be invested over the next three years in roads, dams, schools, hospitals, clinics, and energy and transport infrastructure.

Ramaphosa tables Presidency Budget Vote:


On energy, Ramaphosa said the country had recorded more than a year without load shedding, and that Eskom had returned to financial and operational viability.

“Through the National Energy Crisis Committee — and thanks to the efforts of Eskom, government departments and social partners — the country has recorded more than a year without load shedding,” he said.

He also pointed to improvements at Transnet, with better port and rail performance helping ease bottlenecks in mining, agriculture, and manufacturing. Agriculture recorded an 11 percent increase in export earnings between January and March this year compared to the same period last year. South Africa also recorded 10.5 million international tourist arrivals last year, the highest on record.

Ramaphosa announced a programme to release land with title deeds to deserving beneficiaries as part of efforts to include black farmers in commercial agriculture and revitalise rural economies.

However, the President cautioned that recent labour market data showed a decline in employment, which he said was a matter of serious concern.

“We know from experience that it often takes time for investment to translate into economic growth, and for growth to translate into jobs. But we must still be deeply concerned about the decline in employment, because it is about people’s lives and livelihoods,” he said.

He said economic growth was not an end in itself.

“Economic growth is not an end in itself. Its purpose is to create work, restore hope and expand opportunity. Every investment secured, every infrastructure project completed and every reform implemented must ultimately improve the lives of ordinary South Africans,” Ramaphosa said.

Ramaphosa tables the 2026/2027 Presidency Budget Vote before the National Assembly: