South Africa’s junk credit rating was avoided, but at the cost of junk analysis
NOVANEWS
Punch NG
Patrick Bond
Major investors were hoping Zuma would fall, but the ruling ANC turned to well-tested strategies to yet again protect him. And although credit rating agencies had offered pessimistic commentary on Zuma’s reign in their most recent statements, they did not downgrade South Africa to junk status. But the whip remains poised above the country’s head, awaiting next June’s ratings.
Standard&Poors (S&P) gave South Africa a fearful few hours of anticipation last Friday, just after dust from the political windstorm of the prior week settled. The agency downgraded the government’s securities that are denominated in the local currency (the Rand) although it refrained from the feared junk status on international securities. It wa...