Latest SA credit rating outlook is a testament to hard work happening behind-the-scenes
An upbeat latest SA credit rating outlook from global credit rating powerhouse Standard & Poor is testament to hard work happening behind-the-scenes regarding economic reform.
The Cape Chamber is one of several private sector organisations actively engaging with government to address economic impediments to growth, of the kind routinely highlighted in ratings agency reports. However whereas ongoing impediments are often cited as reasons for ratings downgrades, the latest S&P report referenced local efforts to address impediments as a reason to raise SA’s credit rating outlook – a surprise move that speaks volumes about the importance of goal-orientated public-private collaboration. In their latest review S&P said: ““The positive outlook reflects our view that increased political stability following the May general elections and impetus for reform could boost private investment and GDP growth. The GNU coalition has established a nine point agenda to address basic infrastructure and service delivery shortfalls and weak investments, while gradually narrowing fiscal deficits.”
That there remains much work to be done amid challenging conditions goes without saying – South Africa’s current rating remains pegged at three notches below investment grade. But S&P’s positive outlook rating at least corroborates the positive momentum that informs local efforts to accelerate reforms. Our business networks continue to highlight infrastructure and service delivery shortcomings, and our business survey provides sector-specific information regarding the most pressing challenges and policy priorities going forward.
The Chamber intends amplifying our survey findings in the coming weeks to further assist our government partners in their journey towards accelerated growth. In this way we hope that the next S&P rating could see more than just a positive outlook but a move up the investment rating ladder.
John Lawson
CEO of the Cape Chamber of Commerce and Industry