Malusi Gigaba's first week in office has been a baptism of fire as South Africa's fourth finance minister in just more than a year with two of the world's three leading credit-ratings agencies downgrading the country's creditworthiness to "junk". Spooked by President Jacob Zuma's wholesale changes to his cabinet last week and by the political fallout that followed, Fitch Ratings on Friday lowered the country's foreign and local currency debt to junk. S&P Global Ratings had already cut the long-term foreign currency debt rating to junk (BB+). Moody's is expected to follow suit soon. "Two out of three ratings agencies have junk-graded us, so we are officially junk," said Iraj Abedian, economist of Pan African Advisory. "It means that a lot of fund managers who are not allowed to be in areas or in countries that are junk-rated will have to pull out of South Africa. When S&P downgraded us, it meant more money wouldn't come into the country, but now it means that those who are in the cou...

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.

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.