JOHANNESBURG – South Africa’s Treasury is seeking to raise at least $500 million through foreign currency financing options for the 2025/26 fiscal year, days after parliament ended a prolonged budget impasse.
The call for proposals was made on Friday, following the July 23 passage of the Appropriation Bill by the National Assembly, a breakthrough that came after weeks of political wrangling within the coalition government.
The African National Congress (ANC), which governs alongside the Democratic Alliance (DA) and several smaller parties, scrapped a proposed VAT hike and saw President Cyril Ramaphosa fire a cabinet minister accused of misconduct in order to secure the DA’s support for the budget. 
Treasury said it is looking for “innovative” hard currency funding mechanisms to diversify from the traditional Eurobond approach, citing a need to reduce execution risks and lower borrowing costs.
Proposals are being sought from select entities, including primary dealers in government securities, multilateral institutions, arranging banks, institutional investors and other regulated financial firms capable of large-scale funding.
The move reflects the growing difficulty African governments face in sourcing affordable international debt. Angola recently halted its own borrowing plans, and Ghana has turned to local markets after emerging from default. Global issuance of sovereign debt in emerging markets has reached $154.2 billion so far this year, but remains concentrated in the Middle East and Eastern Europe.
Treasury will consider a range of financing options, including bilateral loans, private placements of floating rate notes, structured notes, repurchase agreements, cross-currency swaps, and ESG-linked instruments. It said proposals will be assessed on cost efficiency, resilience to currency shocks, and compatibility with the country’s debt profile.
Interested parties have until August 6 to submit proposals, with decisions expected by August 29.
Although Treasury described the exercise as exploratory, the initiative comes against a backdrop of worsening fiscal forecasts. The budget deficit is now projected at 4.8% of GDP, up from an earlier estimate of 4.6%, while gross debt is expected to stabilize at 77.4% of GDP.
