'Weak state entities a risk to SA's credit rating'

 16 October 2018

South Africa’s credit rating would be downgraded if state owned enterprises (SOEs) raise government’s debt burden, Moody’s warned.

The rating agency on Tuesday released a research report on the government.

Moody’s has rated South Africa at Baa3, one rung above junk status, with a stable outlook. The rating agency was scheduled to issue a rating action last Friday, but did not which meant the rand remained resilient strengthened on Monday following the delayed rating decision.

According to the report, the challenges to the country’s credit include weak SOEs, structural economic bottlenecks which are limiting growth and job creation as well as policy uncertainty stemming from “social and political divisions”.

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