‘People are going to have to cut back’
Two ratings companies, Fitch and Standard & Poor’s, recently downgraded South Africa to junk status. The impact is expected to be felt by average South Africans. Reporter asked a few how the downgrade would affect them
ROBERT PILLAY, 54, said the country’s junk status would affect interest rates and would make it harder for people to secure loans.
“People are going to have to cut back. We can’t spend the way we used to.”
The Phoenix resident believes the country needs suitable officials in government to address the current financial crisis.
“Removing Pravin Gordhan as finance minister was a bad move. It led to two credit rating agencies dropping our status.”
Johannesburg resident DAWOOD BAYAT, 52: “For now the layman, with no offshore investment, will not feel the effects. When the interest rates and the prices of bread and petrol go up, it will hit him.”
He said the government needed highly qualified people in command of the economy – “those who know what’s happening on the stock exchange”.
“There’s just too much fighting within the ANC. There is so much wealth in this country, but people just don’t want to invest here.”
Bayat added: “Food and petrol are already costly and we have had to cut back on so many expenses, but there are things you just can’t cut like your bond and car payments.”
KALIE NAIDOO,
59, of Johannesburg said: “Junk status means the exchange rate goes up, import costs increase and overseas investors will not consider investing in South Africa.”
She said she had made cutbacks over the past two years and it seemed she would need to continue doing so.
“The leadership in the ANC has let things slide. They need to clean up their act.” MASEEH RAJAH, 35, of Johannesburg said: “If we have a bad economy, we can’t engage in international trade.”
Rajah has not yet made any financial cutbacks.
“But when the price of petrol goes up and basic food items increase, I will cut back. The country won’t be rebuilt overnight, but it would help if the government could be more transparent with our money.”