OWN CORRESPONDENT, London | Friday 4.25pm
POWER, transport, water, and telecommunications — the four pillars of national infrastructure — will continue to provide a strong platform for economic growth in the post-Mandela era, says international credit rating agency Standard & Poor’s in a survey published on Friday.
The 70-page publication details the credit quality of state-owned corporations such as Eskom, Transnet, and Telkom, as well as the largest water board, Rand Water.
All these companies have outstanding local debt obligations, which have been assigned triple-B-plus long-term local currency ratings by Standard & Poor’s, while Eskom, Transnet, and Telkom have also been frequent borrowers on the international Eurorand and Eurobond markets, and have benefited from a double B-plus long-term foreign currency rating on their bond issues.
The report also includes analyses on two privately financed toll roads — the N4 and N3 — which have been rated by CA-Ratings.
The survey points to a potential turnaround in the South African economy after years of sluggish growth resulting from high real interest rates, a weak currency, and a slump in major commodity prices.
The report says that the election of Thabo Mbeki earlier this year as the new president has served to reaffirm the commitment of the ruling African National Congress to promoting infrastructure development as a means to provide employment, attract inward investment, and ultimately lead to much-needed improvement in living conditions for the majority of the population.
The success of the government’s socio-economic policies relies to a large extent on infrastructure investments, especially in the provision of power and water to deprived areas of the nation, as well as transport links to enable continued commercial and economic growth. — Reuters
11