Moderate growth expected in 2017 but downgrade risk remains, S&P warns
S&P chief European economist Jean-Michel Six also says SA’s slower growth preceded the global downturn
SA is likely to experience moderate growth in 2017 but S&P warns that the country is still vulnerable to a credit downgrade. S&P chief European economist Jean-Michel Six said SA’s slower growth preceded the global downturn, and it had underperformed with comparable GDP per capita ratios. "Growth performance between 2000 and 2015 has been disappointing in comparison. We are expecting an acceleration in this economy this year," said Six. SA’s first credit downgrade was in 2012 and the second was in 2014. The current negative outlook reflects weaker-than-expected real GDP growth, which was 0.3% in 2016 — lower than the Treasury’s forecast of 0.5%. The associate director of sovereign and IPF ratings at S&P, Gardner Rusike, said: "To address inequality and unemployment, SA needs to grow at a much faster pace. SA has been running current account deficits on a more sustainable basis at 4% of GDP, but the debt of the government has been rising and that’s still the case." Rising contingent l...
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