PRETORIA, The South African Cabinet, which says it has reflected on recent downgrading of the country’s debt by all three international rating agencies, asserts the the government remains on track in maintaining its fiscal framework, ensuring policy certainty, and working to ensure inclusive growth and economic transformation.

In a statement after its meeting here Thursday, the Cabinet expressed confidence in its systematic interventions to address the country’s economic challenges as well as work undertaken to strengthen the performance of state-owned companies (SOCs). “Government remains on track in maintaining its fiscal framework, ensuring policy certainty, and working to ensure inclusive growth and economic transformation, it said.

On June 9, rating agency Moody’s announced that it had downgraded South Africa’s debt rating to ‘Baa3’ from ‘Baa2’, maintaining a negative outlook. The decision still puts the country at investment grade. Earlier this month, Fitch affirmed South Africa’s long-term foreign and local currency debt ratings at ‘BB ‘ with stable outlook. Standard and Poor’s (S&P), meanwhile, affirmed the long-term foreign currency debt rating at ‘BB ‘ and long-term local currency debt rating at ‘BBB-‘ with a negative outlook.

The Cabinet said all three rating agencies had raised similar issues such as the slow pace of growth-enhancing reforms, the performance of state-owned companies (SOCs) and political risks, among other issues.

It reiterated that the foundation for a higher growth path and socio-economic development had already been laid. It said it was focusing on improving investor and consumer confidence by fast-tracking the implementation of the structural reforms for economic growth.

President Jacob Zuma convened a Black Economic Empowerment (BEE) Advisory Council workshop on Tuesday in Pretoria.

The workshop focused on radical socio-economic transformation while it also addressed the systematic and structural implementation challenges of the Broad-Based BEE Act, 2003 (Act 53 of 2003) and the proposed recommendations to realise government’s objectives on radical socio-economic transformation.

The partnership between government, business, labour and civil society is critical to boost confidence levels, so that working together we can reclaim and maintain investment-grade ratings, said the Cabinet.

Source: NAM NEWS NETWORK