We dodged a bullet with Standard & Poor’s affirming its sovereign credit rating with a long-term foreign currency sovereign credit rating of “BB+”, and a long-term local sovereign currency credit ratings of “BBB-”, with a “negative outlook”.
What this means is our long-term local currency debt, which forms 88.2% of our R2.2 trillion net debt, retains its investment-grade rating from Standard & Poor’s. However, despite this Standard & Poor’s raised serious concerns about “political infighting” undermining economic growth and fiscal consolidation, which is reflected in their “negative outlook” for South Africa.
What Standard & Poor’s ratings action confirms is that the “civil war” within the governing party is killing the economy, and that is why a staggering 9.3 million people do not have jobs, or have given up looking for jobs, in South Africa.