- Mar 6, 2004
Renaissance Capital, which has correctly predicted eight out of nine sovereign rating decisions in emerging Europe and the Middle East since May, is calling a downgrade to junk for South Africa next month.
That view is at odds with the majority in the Bloomberg survey, but Renaissance Global chief economist Charles Robertson says SA's fundamentals have deteriorated significantly since May, when Moody's Investors Service affirmed its Baa3 rating. The next review is on November 1.
"The macro numbers are not supportive of South Africa keeping investment grade," Robertson said. "Poor growth, tough public finances, a subdued commodity outlook, tension on the streets as seen in the anti-Nigerian riots, questions about the president’s ability to push through his agenda - all these are worrisome."
Renaissance Capital, which has correctly predicted eight sovereign rating decisions since May, is calling a downgrade to junk for SA next month.