Moody’s again cites politics as biggest risk to SA
Further delays in growth-enhancing reforms could also lead to a downgrade
Ratings agency Moody’s has warned that SA could face a downgrade if there is any sign of institutions being eroded further, or state-owned enterprises hitting cash crunches and having to call on government guarantees. Further delays in growth-enhancing reforms could also lead to a downgrade, the agency warned in a regular credit opinion on the South African economy released on Wednesday, as it again flagged SA’s politics as the biggest risk to the rating. Moody’s, which has SA’s ratings at just one notch above sub-investment and on negative outlook, held back from reviewing SA’s rating on the scheduled date on Friday. But it is due to review the rating again on November 24, after the finance minister presents his medium-term budget in October, but before the ANC’s elective conference in December. The ratings agencies will watch both events closely. Analysts expect that Moody’s and Standard &Poor’s, both of which have SA on negative outlook for a downgrade, may wait and see until aft...
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