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BusinessLive reports that CEOs at SA’s major banks have said that a sovereign credit-rating downgrade would have serious negative implications for economic growth and job creation.
They had earlier criticised the removal of finance minister Pravin Gordhan and his deputy, Mcebisi Jonas. S&P Global Ratings cut SA’s foreign-currency credit rating to junk status on Monday night, saying "executive changes" by President Jacob Zuma risked fiscal and growth outcomes. The downgrade will increase government borrowing costs, as bond investors demand a higher return in exchange for higher perceived risk. "If investors lose faith and trust in our economy, all citizens pay the price for this, in the form of higher inflation, decreased buying power as well as decimated savings, pensions and investments," the CEO Initiative said. "A lack of investment also means that growth and much-needed job creation will be stifled," it added.
- Read this report by Hanna Ziady and Moyagabo Maake in full at BusinessLive
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