Fitch: Gi­gaba’s strat­egy un­likely to boost growth

The Star Early Edition - - BUSINESS REPORT -

IN­TER­NA­TIONAL rat­ings agency Fitch said yes­ter­day the eco­nomic strat­egy re­leased by Fi­nance Min­is­ter Malusi Gi­gaba last week was un­likely to boost growth, be­cause many of the mea­sures had been an­nounced pre­vi­ously. Last Thurs­day, Gi­gaba laid out a 14-point pro­gramme that in­cluded the pos­si­ble sale of as­sets and par­tial pri­vati­sa­tion of state-owned firms. The plan re­ceived a luke­warm re­cep­tion from in­vestors lo­cally and abroad. “The South African gov­ern­ment’s newly an­nounced In­clu­sive Growth Ac­tion Plan is un­likely to sig­nif­i­cantly boost eco­nomic growth prospects,” said Fitch, which rates the coun­try’s lo­cal and for­eign debt a sin­gle notch be­low in­vest­ment grade. Fitch said it had halved its growth fore­cast for this year to 0.6 per­cent from 1.2 per­cent pre­vi­ously be­cause of weak eco­nomic per­for­mance and po­lit­i­cal un­cer­tainty. Fitch has warned that changes to mine own­er­ship laws were proof that eco­nomic pol­icy was tilt­ing to­wards a rad­i­cal, pop­ulist di­rec­tion. – Reuters

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