S&P rating for SA stays negative
RATINGS agency Standard and Poor’s ( S& P) has affirmed South Africa’s long-term credit rating at BBB and local currency credit rating at A-, the National Treasury said yesterday.
“S&P said the negative outlook reflected their view that South Africa’s ratings are constrained by a sizeable current account deficit, which is funded by potentially volatile portfolio flows,” said spokeswoman Phumza Macanda.
“According to S&P, South Africa’s recent lacklustre economic performance, external imbalances, and labour tensions could affect its macroeconomic policy framework beyond the agency’s expectations.”
Macanda said it was the government’s view that the rating opinion did not adequately take note of progress made in the issues raised by S&P in its initial downgrades in 2012.
“The government will continue to invest in infrastructure with the view of enhancing the productive capacity of our economy and the competitiveness of our industries.”
These investments would be mindful of fiscal sustainability as tabled in the 2013 mediumterm budget. According to this the government committed itself to increasing efficient spending across all government departments. – Sapa