Cosatu pleads with Moody's to consider workers
SA has been placed on review for a downgrade pending the outcome of an assessment of the economy.
JOHANNESBURG - The Congress of South African Trade Unions (Cosatu) has appealed to ratings agency Moody's, to consider the living and working conditions of South Africa's poor before deciding whether or not to downgrade the country's investment grade.
A delegation from Moody's arrived in the country yesterday.
South Africa has been placed on review for a downgrade pending the outcome of an assessment of the economy.
Cosatu president S'dumo Dlamini says a downgrade will spell disaster for workers.
"If their expectation is that workers should not demand salary increases, that's unfair. They don't seem to appreciate what we are going through as workers here in South Africa."
LISTEN:_ Good news: Ratings agency, Moody's places downgrade on SA on review_
Moody's announced that it's placed the government's bond and issuer ratings on review.
Moody's says this will allow it to assess the likelihood that the decline in South Africa's economic strength will be reversed over the medium term.
The country has been edging towards a downgrade to junk status, but Moody's says it needs more time to see if this can be averted.
Moody's cited South Africa's weak economic performance as a risk factor when assigning a negative outlook to the rating in December.
It says the local economy is vulnerable to global domestic and financial market dynamics while also carrying a government debt burden.
Moody's says the review will allow it to assess to what extent government policy can stabilise the economy and restore fiscal strength in the face of heightened domestic and international market volatility.
During the review, Moody's will assess the likely effectiveness of government's plans, including those contained in the National Development Plan.
To view the National Treasury's response to Moody's decision, click here.
To view Moody's statement, click here.