South Africa Weighs Tapping Foreign Reserve Gains to Close Funding Gap
- Treasury has so far refrained from accessing gains on reserves
- Government isn’t ruling out raising more international debt
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South Africa is considering digging into the nation’s 459 billion rand ($24.6 billion) of foreign reserves to close a funding gap as tax revenue falls short of target, the nation’s finance minister said.
The central bank oversees the Gold & Foreign Exchange Contingency Reserve Account, which contains unrealized profits or losses on the reserves that are incurred due to exchange rate fluctuations. While the gains — and losses — accrue to the government, the Treasury has refrained from tapping them so far.