DURBAN – Nedbank Group chief executive Mike Brown has issued a strong warning to the government stating that the country is fast running out of both time and money, and urgently needs structural reforms to stem economic and fiscal deterioration.
He sounded the warning on Tuesday after the lender released its results for the six months to end June, reporting a 2.6 percent growth in headline earnings to R6.9 billion and a return on equity of 17.9 percent.
“While there were some positive developments post the South African national general elections in May, progress on structural reforms and policy certainty remained far too slow,” Brown said. He said if the country failed to institute structural reforms to stem the economic and fiscal deterioration, job losses and more downgrades could follow in the future.
“If we are unable to do this, all the hard work done on maintaining our last investment grade rating from Moody’s will be in vain, at great cost to all South Africans due to higher inflation and higher interest rates as well as lower growth and lower levels of employment than would otherwise have been the case,” he said.
Last month, Fitch Ratings also downgraded South Africa to a notch below investment grade.