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Displaying items by tag: Ratings downgrade

Engineering News - 8 April 2020 by Simone Liedtke

Read online at Engineering News

Published in TIPS In the News
Tuesday, 07 April 2020

The ratings downgrade

The economic effects of Moody’s recent credit ratings downgrade have been overtaken by the whirlwind effects of the COVID-19 crisis. It is, however, also important to understand the likely effects of the downgrade, which vary for different sectors and stakeholders,  to ensure a reasoned response. This policy brief looks at the economic impacts of the decision. It also considers the policy implications. While the ratings agencies have indicated that changes in economic policies and practices could reverse the downgrade, these policy demands on South Africa are contradictory. They suggest that, to improve its credit rating, South Africa must reduce worker protections, limit land reform, and cut government spending. However, these measures would all in turn aggravate social inequalities and policy contestation, increasing investor uncertainty and risks over the long run.

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  • Year 2020
  • Author(s) Neva Makgetla (TIPS)
Published in Policy Briefs