SA’s Moody rating remains bleak amidst ongoing strikes

"The fiscal space is eroding," Moody's sovereign analyst Kristin Lindow told a conference in Johannesburg on Wednesday. "A key credit challenge will be reining in government spending."

Moody's, Standard & Poor's and Fitch lowered their rating on South African debt by one level since last year. Moody's has a negative outlook on South Africa's Baa1 rating, the third-lowest investment-grade level.

The rating companies cited deteriorating economic growth, weakening public finances, political uncertainty and labour unrest for the downgrades.

A series of strikes that shut mines last year have continued this year, curbing output and exports in Africa's largest economy.

"There is a mismatch between the expectations of labour and the expectations of mining companies," Lindow said. "Both sides are talking past each other, not to each other. This year's wage round is a matter of considerable debate."

The decision by regulators to grant power utility Eskom smaller tariffs increases than it requested was positive for the economy, as were the government's coherent fiscal, monetary and exchange rate policies, she said.

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Related stories


Subscribers only

‘Captured’ water utility exec holes up

Thami Hlongwa seems to be in hiding after a blacklisted technology company scored millions from Umgeni Water and the owner was murdered

Step-aside guidelines are not about Ace, says Mathews Phosa

The guidelines must be ‘timeless, uniting and not capable of being abused,’ says ANC veteran

More top stories

Pregnant women should be vaccinated, doctors say

New research shows that there has been an increase in maternal deaths during the Covid-19 restriction

Simeone is Atlético’s secret weapon

El Cholo remains true to himself — consistent, totally committed and prepared to graft — and these values are retained by the team

The private-sector players who facilitated public-sector fraud

Let us never forget the private-sector players who facilitated public-sector fraud

Semenya confirms she’s taking testosterone battle to European Court of...

Caster Semenya’s latest legal challenge follows a series of setbacks that seemed to have ended her chances of competing in her preferred events

press releases

Loading latest Press Releases…