EFF statement on the decision by rating agency Moody’s investors
28 March 2020
The EFF notes the decision by rating agency Moody's Investors Services to downgrade South Africa's long term foreign and local currency debt ratings from Bl to Baa3, effectively downgrading South Africa's sovereign rating to junk status. Moody's reason for downgrade is weak growth and government debt over the medium term.
Moodys decision to downgrade South Africa sovereign rating to junk status shouldn’t come as a surprise as the governing party has effectively mismanaged the economy through incompetence, corruption and ill-advised foolish policies. Moody's decision is a confirmation of what we already know because there are no believable plans to revive South Africa's economy, to collect maximum revenue and create sustainable jobs.
The decision was long overdue because there is no direction and clarity under the leadership Of President Cyril Ramaphosa and Minister Of Finance Tito Mboweni. South Africa's Treasury and Reserve Bank continue to be characterised by fiscal and monetary policy incompetence and mismanagement Of the economy and state-owned companies. NO one knows exactly what Ramaphosa and Mboweni are planning to do to revive economic activities. The decision has nothing to do with the current parxiernic of Coronavirus spreading across the world.
The EFF is concerned tiat with the downgrading, directionlessness of government concerning economy policy and now the Coronavirus, the revenue base will significantly shrink and therefore threatening government capacity to pay social grants, salaries of public servants such as teachers, nurses, police and deliver much needed services to our people.
Lastly, whilst the Economic Freedom Fighters correctly observes the directionless of the current administration, we are of a strong conviction that during this period of Coronavirus, the rating agencies should discontinue the devastating ratings which will make it impossible for governments to raise the necessary resources to respond to the pandemic.
Issued by Vuyani Pambo, National Spokesperson, EFF, 28 March 2020
