Government has noted credit rating agencies Standard & Poor (S&P) and Fitch\u2019s recent assessment of South Africa\u2019s investment grading.<\/p>\n
S&P in its rating affirmed South Africa\u2019s long term foreign and local currency debt ratings at \u2018BB and \u2018BB\u2019, respectively.<\/p>\n
The agency maintained a stable outlook.<\/p>\n
The National Treasury in a statement said according to the agency, South Africa’s near-term economic performance and current account are experiencing a cyclical uplift as a result of a combination of base effects following a large economic contraction in 2020 and improving terms of trade from higher commodity prices.<\/p>\n
\u201cHowever, structural constraints, a weak pace of economic reforms, and slow vaccination rates will continue to constrain medium-term economic growth and limit the government’s ability to contain the debt-to-GDP ratio,\u201d reads the statement.<\/p>\n
Fitch has affirmed South Africa\u2019s long term foreign and local currency debt ratings at \u2018BB-\u2019.<\/p>\n
The agency maintained a negative outlook.<\/p>\n
According to Fitch, South Africa\u2019s rating is constrained by high and rising government debt, low trend growth and exceptionally high inequality that will complicate consolidation efforts.<\/p>\n
Treasury said the negative outlook reflects continued substantial risks to debt stabilisation despite the better than expected fiscal outturns in the fiscal year ending March 2021.<\/p>\n
In the statement, the Treasury said government acknowledged the pressures the country\u2019s credit ratings face and remains committed to addressing them.<\/p>\n
\u201cAdditionally, government is aware that it needs to fast track growth-enhancing strategies. Operation Vulindlela is a key initiative in this regard and demonstrates government\u2019s commitment to fast-tracking the implementation of critical reforms that raise economic growth and improve fiscal sustainability,\u201d the department said.<\/p>\n
Rating agencies have indicated that South Africa\u2019s rating strengths include a credible central bank, a flexible exchange rate, an actively traded currency, deep capital markets as well as a favourable debt structure (low share of foreign currency debt) with long maturities, which should help counterbalance low economic growth and fiscal pressures.<\/p>\n
\u201cAs highlighted in the 2021 Budget, government\u2019s fiscal strategy puts South Africa on course to achieve a sufficiently large primary surplus to stabilise debt. Over time, debt stabilisation will reduce borrowing costs and the cost of capital, attracting investment that can support the economy,\u201d Treasury said.<\/p>\n
Government has implored all members of society to adhere to all the necessary health and safety protocols in place to minimise a rise in COVID-19 infections.<\/p>\n
South Africa plans to accelerate its vaccination roll-out programme with Phase two having commenced on 17 May, with the aim of inoculating five million citizens aged over 60 by the end of June 2021.<\/p>\n
Successful vaccination of the population will help prevent the spread of the pandemic as it poses downside risks to the economic outlook. \u2013 SAnews.gov.za<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" Government has noted credit rating agencies Standard & Poor (S&P) and Fitch\u2019s recent assessment of South Africa\u2019s investment grading. S&P in its rating affirmed South Africa\u2019s long term foreign and local currency debt ratings at \u2018BB and \u2018BB\u2019, respectively. The agency maintained a stable outlook. The National Treasury in a statement said according to the […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","ngg_post_thumbnail":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[38678],"class_list":{"0":"post-189866","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-south-africa","7":"tag-sanews","8":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts\/189866","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/comments?post=189866"}],"version-history":[{"count":0,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts\/189866\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/media?parent=189866"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/categories?post=189866"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/tags?post=189866"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}