Debt service costs continue to grow over the medium term, draining resources that could be spent on productive investment. Government debt cost is projected to rise from R88.8 billion (2.7 per cent of GDP) in 2012/13 to R114.8 billion (2.6 per cent of GDP) in 2015/16. The domestic bond market will remain the primary source of debt funding. The debt issuance will be achieved by drawing on cash balances, exchanging debt maturing within the next several years and borrowing in global capital markets. The public sector borrowing requirement remains at 7.1 per cent of GDP, moderating over the medium term.