Johannesburg – The reasons behind the downgrading of South Africa's creditworthiness to junk status indicates interference in the country's political affairs by S&P Global, the Congress of SA Trade Unions (Cosatu) said on Tuesday.
Secretary Bheki Ntshalintshali added, however, that President Jacob Zuma's "negligent leadership" was also to blame for the downgrade.
"We express our disapproval of the credit rating agency S&P's decision to downgrade the country, and we view their reasons about political uncertainty as interference in our domestic political affairs, which is beyond their scope of work," said Ntshalintshali.
We also hold the President of the Republic Jacob Zuma responsible because it is his inattentive and negligent leadership and disruptive actions that have emboldened these agencies to interfere in the country's affairs."
President Sdumo Dlamini said the downgrade was not taken lightly by the trade union federation.
"Of course they cannot ignore the politics and their impact on the economy...but when they act in a manner that shows that their action is political, then that becomes a problem," he said.
"They came at the time after the reshuffle and stated what they stated...which was actually in anger and then decided to downgrade South Africa."
Ntshalintshali said Cosatu was nevertheless worried that the junk status would have an impact on inflation as it would result in an increase in borrowing costs across the economy.
"What is more worrying also is that according to Treasury, the 2017/2018 budget totals R1.56 trillion of which revenue covers R1.41 trillion. The remaining R149 billion will be borrowed and there is a strong possibility that government will be forced to raise taxes to fund most of its spending," he said.