On 13 June 2014 the Fitch ratings agency revised the outlook on South Africa to negative from stable and affirmed its credit rating at ‘BBB’.<\/p>\n
Standard and Poor\u2019s, meanwhile, also downgraded the country\u2019s sovereign credit rating to BBB-.<\/p>\n
In Business Day TV\u2019s \u201cThe Week That Was\u201d show<\/strong><\/a>, Sasfin Securities’ David Shapiro said that people will be well advised not to come into South Africa\u2019s bond market.<\/p>\n \u201cThere is too much risk on the horizon. There are too many uncertainties about where the country is going as an economy,\u201d said Shapiro.<\/p>\n One comment from Fitch stood out in its South African rating: “In Fitch’s view, the track record of some key ministerial appointments and shortcomings in administrative capacity mean this is subject to downside risks.”<\/p>\n Many people were critical towards President Jacob Zuma\u2019s ministerial choices. The fact that a rating agency mentioned it as a downside risk tells us just how bad these choices were.<\/p>\n Shapiro agreed that SA\u2019s new ministers are not good enough, questioning whether an investor would put their money into a company which our ministers ran.<\/p>\n \u201cIf these chaps were running even a division of a business would I be there \u2013 the answer is no. Just an absolute no,\u201d said Shapiro.<\/p>\n \u201cThey are driven by mad things \u2013 not the desire to actually build things,\u201d he said. \u201cPolitical ideology is still very much part of where this country is going.\u201d<\/p>\n The show\u2019s panelists – Shapiro, Simon Brown and Giulietta Talevi – said that whether South Africa is in a recession is academic.<\/p>\n The reality is that South Africa is in a tough spot economically, and the country needs to grow at 5% to address the challenges it faces.<\/p>\n The bad news, they said, is that many local companies are divesting in South Africa \u2013 partly because of a lack of trust in the local economy.<\/p>\n \u201cAll you have to do for guidance is to read company reports. If you see where businesses are going \u2013 they are moving their investments overseas,\u201d said Shapiro.<\/p>\n \u201cIt is a quiet withdrawal from South Africa, and you don\u2019t even know it is happening.\u201d<\/p>\n More affordable broadband for SA: Zuma<\/strong><\/a><\/p>\nSouth Africa\u2019s poor ministers a problem<\/h3>\n
Concerns about SA economy<\/h3>\n
More on South Africa<\/h3>\n