Moody’s pending decision on their ratings review is still outstanding but early indications are that they will confirm South Africa’s Baa3 rating but with a Negative Outlook. In comparison to the Medium Term Budget Policy Statement in 2017, South Africa confirmed the improved fiscal orientation in the 2018 budget. Credit agencies perceived this as positive but also warned that South Africa must continue on this path. It is important that South Africa makes a firm turn around and follow through on the change of leadership and great sense of optimism. In general, economic performance weighs more than political developments in the long run. The economic indicators reacted positively on the budget speech which indicates a turn-around in business confidence. As a net exporter the agricultural industry will be challenged to rely less on a weakening exchange rate in the long run but to continue to improve productivity by focusing on research, technology and improved market access.
Published on Monday, 26th February 2018 - 12:28