Fitch’s rating is clear evidence that the politics is killing the economics in SA
The decision by Fitch Ratings (“Fitch”) to affirm its sovereign credit rating at “BBB-” and revise down its outlook to “Negative” is clear evidence that the politics is killing the economics in South Africa.
Despite noting that the economy may have started recovering, Fitch identifies “political risk” as the key “rating driver” in South Africa.
The “infighting within the ANC” and “ANC factional battles” had the effect of:
- distracting policymakers and leading to mixed messages, which undermined investor confidence and economic growth; and
- undermining efforts to improve governance and the streamlining of State-Owned Enterprises.