SA on borrowed time as ratings downgrades loom
The commodities boom has perked up the economy, allowing SA to stave off ratings downgrades. But once the upswing subsides, structural problems will resurface, unless the government acts more boldly
SA escaped the three main credit ratings agencies’ May reviews relatively unscathed, thanks mainly to a supportive trade environment that has provided a cyclical uplift to the country’s revenue and growth prospects, making the economy appear healthier on the surface.
However, it is the job of ratings agencies to take a penetrating look under the hood — and their prognosis is that SA’s public finances remain structurally weak...