S&P rat­ing for SA stays neg­a­tive

Weekend Argus (Saturday Edition) - - BUSINESS -

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

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