Johannesburg - Finance Minister Pravin Gordhan has said he spoke to credit ratings agencies after delivering the national Budget and said it was important to take note of their views.Gordhan targeted the wealthy with tax hikes in a Budget aimed at reining in a deficit after downgrade warnings by the three major ratings agencies. He faced questions from a parliamentary committee on the sway the agencies had over Africa’s most industrialised economy.
S&P Global Ratings, Fitch and Moody’s said the country’s credit ratings could be downgraded if growth remained weak and commitment to fiscal prudence came into doubt.
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S&P and Fitch rate South Africa’s credit one level above junk status, while Moody’s puts it two notches above.
The agencies have been criticised by ruling party officials for saying political tension in the ANC ahead of their conference in December to pick a new party leader could trigger downgrades.
“We don’t allow them to govern South Africa We have political and fiscal sovereignty,” Gordhan said in response to a question by a member of the committee.
“They can impose nothing on us at the moment, but if we slip on the fiscal side they can, and we will find ourselves, like other African countries, at the door of the [International Monetary Fund].”