President Cyril Ramaphosa has announced that government will soon undertake far-reaching economic reform measures aimed at resuscitating the country's economy.
"We need to fix our public finances. Our debt is heading towards unsustainable levels, and spending is misdirected towards consumption and debt-servicing rather than infrastructure and productive activity.
"We cannot continue along this path, nor can we afford to stand still," said President Ramaphosa on Thursday.
The President was delivering the State of the Nation Address (SONA) to a joint sitting of the two Houses of Parliament in Cape Town.
Some of these touted reforms are contained in the Economic Transformation, Inclusive Growth and Competitiveness Paper produced by National Treasury.
President Ramaphosa said the country's low levels of growth mean it is not generating enough revenue to meet its expenses.
Finance Minister Tito Mboweni will outline a series of measures to reduce spending and improve its composition when he delivers his Budget Speech in two weeks' time, President Ramaphosa said.
"We are engaged with labour and other stakeholders on measures to contain the public wage bill and reduce wastage," he said.
The President said efforts to reduce government spending, prioritise resources more effectively, and improve the efficiency of the country's tax system are important contributions towards stabilising public finances. However, much more needs to be done.
President Ramaphosa said the State will improve public finances by working with the Auditor General to reduce irregular expenditure, shifting government spending from consumption expenditure to investment in infrastructure.
"Achieving sustainability will ultimately require us to address structural challenges in the economy that raise the cost of living and doing business," said the President.
National Treasury and the South African Reserve Bank are working together to ease pressure on business and consumers.
Government, the President said, has decided to establish a sovereign wealth fund as a means to preserve and grow the national endowment of the nation, giving practical meaning to the injunction that the people shall share in the country's wealth.
Additionally, the President announced that a State bank will be established as part of efforts to extend access to financial services to all South Africans.
The Minister of Finance will provide further details on these announcements in his Budget Speech.