Fitch keeps stable outlook for SA despite BB+ rating

THE GOVERNMENT has said it fully recognises Fitch Rating Agency’s assessment of challenges the country faces in the immediate to long term.

It said yesterday that tangible progress on confidence-boosting measures to improve investor confidence were being made.

Yesterday the rating agency affirmed South Africa’s longterm foreign and local currency credit ratings at “BB+”, although it maintained a stable outlook for the country.

Fitch said the decision to declare the country’s credit rating at below investment grade took into consideration that financial challenges at key state-owned enterprises (SOES) remained substantial and the government debt had yet to stabilise.

But the agency said there were signs of recovering governance standards and the prospect of a mild, cyclical recovery.

In a statement, National Treasury said concluding critical policies, such as the Mining Charter, remained important for providing policy certainty in the country.

“Furthermore, the recent changes in governance in critical SOES and the 2018 Budget, which outlined decisive and specific policy measures to strengthen the fiscal framework, are expected to improve the investment climate of South Africa,” the National Treasury said.

“The government is also prioritising its plans for inclusive growth.

“Collaboration with government, business, labour and civil society continues to yield necessary interventions to positioning South Africa as an attractive investment destination while also creating an enabling policy environment for inclusive economic growth.”

In November, ratings agency S&P Global downgraded South Africa’s credit rating to full junk status, while its counterpart, Moody’s, placed the country on review for downgrade. – African News Agency (ANA)