Joburg gets credit rating downgrade

The City of Johannesburg’s credit rating was downgraded on Tuesday, in line with the credit rating action taken on South Africa, the city said in a statement.

“While the economic climate is expected to slow down, the city is making progress in an array of aspects to minimise the expected impact,” it said in a statement.

Moody’s Investor Services downgraded several municipalities, including Johannesburg, on Monday, following its downgrade of South African sovereign debt.

Johannesburg’s long-term debt is now rated A1.za, with a negative outlook, from Aa3.za. Its short-term issuer rating of P-1.za was affirmed.

In reaction, the city said its liquidity and gearing levels had improved markedly since 2009, when gearing levels reached 54 percent.

They were now at 43 percent, and would continue to decline.

The city had developed a financial plan for capital expenditure worth R100 billion, announced by the mayor earlier in the year.

“The city continues to achieve its own targets, and continues to revise them to higher standards,” it said.

“Despite the downgrade, the city wishes to assure the investment community and all its residents that all financial measures indicate an improved financial position.”

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Joburg gets credit rating downgrade