South Africa Weighs More Borrowing After Tax Hike Plan Dropped

South Africa’s National Treasury is considering raising additional borrowing in its latest rendition of the budget, to be delivered on Wednesday, to cover a revenue shortfall after a plan to increase taxes was scrapped.

Increased borrowing, although unpalatable, isn’t being ruled out, said people familiar with the budget process, who asked not to be identified because they aren’t authorized to comment. If it is raised, they stressed, it would be by a conservative amount.

Treasury officials, who have entered their pre-budget quiet period and are not available for comment, have been reluctant to increase borrowing as debt-service costs, including interest ...