GEPF wants go-ahead to invest in assets abroad to ward off effects of junk status
The Government Employees Pension Fund (GEPF) is seeking permission to invest more cash in international assets to protect against the effect of a possible downgrade of SA’s local-currency debt to junk status. The fund is in talks with Finance Minister Malusi Gigaba about easing its investment criteria to include more foreign bonds and equities, Abel Sithole, principal executive officer, told reporters in Johannesburg on Tuesday. The GEPF currently has 1% of its R1.7-trillion in assets in foreign bonds and 5% in international equity. "There is a fear that we might be downgraded this year or next year," Sithole said. "We need to increase our exposure offshore and we are seeking to do so." Investor concern that SA will lose investment-grade status on its local-currency ratings was heightened last week, after Finance Minister Malusi Gigaba’s medium-term budget policy speech forecast rising debt and weaker economic growth. Bank of America estimates there may be $14bn worth of outflows if...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.