Long bond slide shows how SA has decoupled from the ave emerging market bond. It shows that SA pays 421 basis points (4,2%) more when SA govt borrows than the ave EM, Since the firing of Nene the aver is 366 basis points. Markets not buying a good news story but risk increase 1 
SA debt, therefore, costs R40 billion more per Trillion Rand! SA government has over R3 trillion in debt and with Eskom and others, this is costing our economy hundreds of billions each year. There is still some older debt but as we roll it over the cost of borrowing increases 2
This decoupling from other emerging Markets is clear and shows that the market has rerated SA, this is not positive. Chances for lower short term rates are minimal and this also costs. As SA debt grows the cost of debt should grow. SA increasing debt level too 3
The higher amount of debt and the decoupling means that SA rates will stay higher than average EM rates. SA debt repayments as % of GDP in the next six or so years will surpass 5% of GDP. That means of every Rand in tax revenue about 20 cents will go just to debt repayment 4
Any further promises broken now on the level of SA debt to GDP either in the form of lower growth or actual debt will increase the interest rate premium. Interest rates are a weapon of mass destruction when you get it wrong. (miss quoting Warren Buffet) 5
Anyway, it will take years to get out of this mess and instead of being an average emerging market SA is now clearly destined to be a lagged. Those extra billions are as much of a nouse around our necks as is Eskom.
