South Africa’s President Jacob Zuma is expected to meet with business leaders to discuss the country’s credit rating downgrade to a Junk Status.
The meeting with members of the CEO Initiative on Friday seeks to assure them of South Africa’s government’s willingness to bolster investor confidence.The CEO Initiative last month criticized the ouster of Gordhan , describing it as an “ill-timed and irrational dismissal of a trusted and well-respected minister of finance .
Rating Agency Standards and Poor Global attribute the development to what it describes as political upheaval, including the recent sacking of finance minister Pravin Gordhan as well as concern over government debt, and in particular the expense of supporting the state energy firm Eskom.
Economic growth is projected to rebound in 2017 and strengthen further in 2018, driven by household consumption and investment. In particular, the improvement in electricity production removes bottlenecks and should boost confidence and therefore investment, provided that political uncertainties dissipate. Rising production costs, together with the earlier rand appreciation should weigh on exports.
Source: Africafeeds.com / Fred Dzakpata
