Johannesburg member of the mayoral committee for finance Rabelani Dagada believes the city is facing a credit-rating downgrade, following SA’s recent ratings downgrade to junk status. In his budget address on Tuesday Dagada said the looming downgrade was a serious risk to the city’s plans to boost its economic growth rate. Dagada delivered the coalition government’s first budget address on Tuesday, laying out plans for the metro’s R55bn budget. He said 34% of the city’s capital budget was funded through long-term debt and bonds, and that allocations within the capital budget were used to finance the city’s 10-year, R170bn gap in capital infrastructure investment. In an interview after his address, Dagada said the chances of Johannesburg avoiding the ratings-downgrade axe were "slim". "I think we will be downgraded, but I don’t think the impact will be huge," he said. "Where the impact will be huge is if S&P and Moody’s downgrade our local currency. Then we are gone. We are finished....
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