Gordhan: SA has done enough to avoid a downgrade

The minister says govt, the private sector & organised labour have worked hard over the last few months.

FILE: Finance Minister Pravin Gordhan. Picture: Christa Eybers/EWN.

CAPE TOWN - Finance Minister Pravin Gordhan says he believes South Africa has done enough to avoid a downgrade to junk status, at least for now.

Gordhan made the comments in an interview with Bloomberg earlier this week.

Gordhan says, "I think we've done enough on the fiscal side over the next three years to get to a primary surplus in the outer years of our three year planning cycles, and we've demonstrated that our commitment to fiscal consolidation is one we will carry through. Secondly, there are fairly significant areas of reform as far as energy supply is concerned, and labour relations."

LISTEN: _It's D-Day for SA's possible credit rating downgrade. _

Ratings agency, Standard and Poor's Global, will tell government today whether it's done enough to avoid the country being downgraded to junk status.

The International Monetary Fund recently forecast growth for South Africa at around 5.5 percent, with political instability damaging confidence.

However, the Finance Department and businesses have displayed a united front and it's hoped that growth will begin an upward trend.

S&P Global warned in December of a lower GDP, political instability, poor electricity supply and weak business confidence.

Dr Iraj Abedian of Pan African Investment and Research said this may be enough to avert a downgrade.

WATCH: A ratings downgrade explained in 60 seconds.


South Africa is only expected to grow by less than one percent this year, hit by low commodity prices, the drought and the weak rand, S&P will be the second of three ratings agencies to report back on South Africa.

Its decision will follow that of Moody's, which left its ratings unchanged last month.

S&P currently has South Africa's rating at one notch above junk status, with a negative outlook.

Weak growth together with both political and policy uncertainty will be among the many things that the ratings agency will have assessed.