Deputy central bank governor Kuben Naidoo
Deputy central bank governor Kuben Naidoo

South Africa’s economic woes domestic, downgrade risks high: deputy central bank governor

Spread the love

CAPE TOWN   – South African deputy central bank governor Kuben Naidoo said on Tuesday domestic factors are the main cause of a frail economy and the risk of further credit downgrades is “quite significant”.

Painting a bleak picture during a monetary policy forum in Cape Town, Naidoo said a downgrade to South Africa’s local currency rating, which could see it fall out of crucial bond indices, could cost $8 to $12 billion in lost investment.

Fitch and S&P Global Ratings both downgraded South Africa’s foreign-currency rating to speculative grade, or junk, following an abrupt cabinet reshuffle in March that saw the respected Pravin Gordhan axed as finance minister by President Jacob Zuma.

Related Story:  Gaddafi’s son Saif Islam safe in Libya, soon to give televised speech – Lawyer

Africa’s most industrialized economy has been hampered by tensions within the ruling African National Congress and policy uncertainty that have sapped investor confidence and thwarted efforts to create jobs and reduce widespread poverty.

The government says it is striving to boost growth and find policies to boost employment.

Naidoo also cited the high levels of mistrust between the private and public sectors and South Africa’s powerful unions.

“We have a very weak economy and that is almost all due to domestic factors,” he said.“Global factors play some role, but those domestic factors include policy uncertainty, significant levels of mistrust between government, business and labour … and that certainly hobbled growth,” he said.

Related Story:  Kenya spent $536m for 2 elections in 2017 : Treasury

Among many spats between the state and private sector, the chamber of mines and the mining ministry are locked in a number of legal disputes over new regulations which industry says will throttle investment.

Naidoo said the economy would likely grow 0.6 or 0.7 percent in 2017 and inflation should remain within the 3 to 6 percent target range for the next two years. (Reuters)

Spread the love

Leave a Reply

Sundiata Post Media Ltd.

Address: 3rd Floor Office Suite, Bayelsa State Guest House, Plot 1038, Shehu Shagari Way, Maitama, Abuja, Nigeria.
Tel: 08033083361, 08094208271 and 092900705
Whatsapp: 08053069436

Enugu Regional Office: SW 1 New Haven Shopping Mall, Enugu, Enugu State, Nigeria.
Tel: +234(0)7062582838

London Office: 18 Belgrave Avenue, Wd18 7UE, Watford, United Kingdom.
Tel: +447417554143
Dubai Office: PAU Management Suite, Level 23 - Boulevard Plaza Tower 2, Emaar Boulevard,
P. O. Box 124342, Dubai, UAE.
Tel: +971 4 4096849 | Fax: +971 4 409 6850
About Us

SundiataPost is published by Sundiata Post Media Limited, Sundiata Post is Nigeria’s most authoritative online newspaper and ranks among the top five online news platforms in Nigeria.

Guild of Corporate online publishers
A Glance at Our Advert Rate.

Inside Pages

Size In Pixels - Amount

120×180 - N27,967.50

300×100 - N24,695

Text Link - N11,275

More Details info

About Us | Contact Us | Privacy Policy | Terms of Use | Advert Rate