Don't miss

Replay


LATEST SHOWS

EYE ON AFRICA

AU warns 6,000 jihadists could return to Africa

Read more

MEDIAWATCH

Trump's accusers say #MeToo... again

Read more

THE DEBATE

Game Changer? Middle East Diplomacy after Trump's Jerusalem Move

Read more

THE INTERVIEW

Exclusive: Niger's president warns Malian state 'could collapse'

Read more

FOCUS

USA: Voters speak out ahead of high-stakes Alabama Senate race

Read more

TALKING EUROPE

Readying the eurozone for future storms: EU Commissioner Valdis Dombrovskis

Read more

TALKING EUROPE

Russian influence, reforms, corruption: Challenges for Europe's Eastern partners

Read more

THE OBSERVERS

Kidnapped and sold in Libya: Our Observer's story

Read more

ENCORE!

Music show: Son Little, Eminem, N.E.R.D & 'adieu' Johnny Hallyday

Read more

S&P slashes South Africa rating further into 'junk'

© AFP/File | South African Finance Minister Malusi Gigaba, pictured in April 2017, forecasts that by 2020, 15% of economic revenue will be eaten up by debt repayment, a prognostic that conforms to S&P's lowering the country's credit rating

WASHINGTON (AFP) - 

S&P Global Ratings lowered South Africa's credit rating further into "junk" territory on Friday, citing the country's deteriorating public finances and weak economic growth outlook.

S&P dropped South Africa long-term foreign currency sovereign rating to "BB" after having placed it higher in the speculative category at "BB+" in April.

"Weak GDP growth has led to further deterioration of South Africa's public finances beyond our previous expectations," S&P said.

"We think the government will attempt to introduce offsetting measures in an effort to improve budgetary outcomes, but these may not be strong enough to stabilise public finances, and may weaken economic growth further in the near term."

"In our view, economic decisions in recent years have largely focused on the distribution - rather than the growth - of national income," S&P added. "As a consequence, South Africa's economy has stagnated and external competitiveness has eroded."

S&P said its outlook on South Africa is "stable," meaning credit metrics are not expected to change significantly over the next year.

S&P's move comes amid worsening economic data and as tensions rise within the African National Congress, which will choose a new party leader in December to replace President Jacob Zuma.

South Africa finance minister Malusi Gigaba in October slashed the country's GDP growth forecast for 2017 from 1.3 percent to just 0.7 percent, and revealed that by 2020, 15 percent of government revenue would be eaten up by debt repayment.

Zuma is accused of enriching a new corrupt elite rather than helping the poverty-stricken black majority.

The latest downgrading by S&P could spur additional foreign investment to flee South Africa.

© 2017 AFP