‘SA must implement economic reforms to avoid recession’
S&P today released a statement saying it doesn’t see South Africa’s economy slipping into a recession.
JOHANNESBURG - Economists say South Africa must heed the call to implement economic reforms in the next few months in order to stave off a downgrade at the end of the year and to avoid slipping into a recession.
Ratings agency Standard & Poor's (S&P) Global confirmed today that it doesn't see South Africa going into a recession anytime soon, after Friday's decision to keep the country's outlook unchanged at BBB-.
Fitch is expected to announce its rating on Wednesday.
S&P Global warned that economic reforms need to be implemented to avoid a downgrade in December.
Economist Kevin Lings says there's still a risk of a 'technical recession'.
"By that we mean two quarters of negative performance. For the year as a whole, we are still optimistic that we will avoid an outright recession."
Iraj Abedian, an economist, says South Africans needs to look at implementing reforms urgently.
'Whatever reform we make, it will take anything from six to nine months to show some results. It's very important that we use this breathing space to implement those policies in haste."
They believe ratings agency Fitch will raise similar concerns this week when it announces its outlook for South Africa.
LISTEN: Finance Minister Pravin Gordhan talks about ratings downgrade