Ratings agency S&P Global’s South Africa analyst said on Thursday there was no immediate pressure to change the country’s sovereign rating, despite weak economic growth and a growing debt burden.
Gardner Rusike told a ratings conference in Johannesburg that the rating was unlikely to change soon
S&P Global’s long-term foreign-currency rating for South Africa’s debt is ‘BB’. “We don’t believe that there is immediate pressure to change the ratings in the near term,” Rusike said.
He added that S&P Global saw South Africa’s economic growth rate this year at below one per cent and would look for measures to contain fiscal slippage in the finance ministry’s medium-term budget statement on Oct. 30.
Rusike said a recent government bailout to state power firm Eskom would put pressure on the budget deficit but that as a once-off event it did not pose a danger to the country’s sovereign rating.
South Africa’s economy is ranked at sub-investment grade by S&P and Fitch, two of the three main ratings firms, with recent downgrades linked mainly to the weak economy, bailouts for state firms and concerns about governance and corruption.