(Bloomberg) -- South Africa’s National Treasury plans to introduce a new fiscal anchor to provide a sustainable long-term path for public finances.

The primary budget balance has been used as a fiscal anchor since 2021. Unlike the current guideline, the new anchor will be binding, the Treasury said in its 2024 Budget Review published in Cape Town on Wednesday.

Read more: South Africa Now Sees Primary Surplus as Key Fiscal Anchor

The government will achieve its first primary budget surplus – the amount by which revenue exceeds non-interest spending — in 15 years in the current fiscal year.

“International analysis links well-designed and binding fiscal rules to improved fiscal balances, less frequently missed fiscal targets and lower borrowing costs,” the Treasury said. “With the primary budget surplus in place, government will consult widely on the matter of a legislated fiscal anchor in the year ahead.”

In a plan presented by the Treasury to President Cyril Ramaphosa last year, it said regaining long-term fiscal credibility will require South Africa to adopt fiscal rules such as a debt ceiling or primary-balance target and stronger budget processes, including life-cycle costing for capital projects.

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