POLITICAL divisions are now SA’s number one credit weakness, Moody’s new lead analyst for SA, Zuzana Brixiova says. While SA’s low growth rate and its ability to stabilise public debt levels were key issues in the past, Moody’s was keeping a close eye on SA’s political divisions ahead of a planned update to its rating on November 25. Brixiova warned on Tuesday that the government must deliver on some of the reforms it had promised if it wanted to stave off a downgrade. "The noise by itself is not an issue, but the question is whether the noise creates division which impedes structural reforms and could undermine the rating," she said. The agency sees the partnership that business, the government and labour have forged as a positive, but warned again that it had to see tangible outcomes in terms of structural reforms that the government had committed to, in areas such as labour markets and state-owned enterprises. In May, Moody’s confirmed SA’s rating, but put it on negative outlook,...
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