SA gets good rating – with reservations

Research and credit insurance company Coface says while South Africa has a positive outlook for the most part, there are questions about the country’s resilience that make it risky. According to Yves Zlotowski, chief economist for the Coface Group, South Africa has been given an A3 rating in the latest Coface outlook, but with a negative watch. “A3 is an excellent rating because on the micro side South Africa has many good aspects counting in its favour such as corporate transparency and good governance.” But, said Zlotowski, Coface had given it an A3 rating with a negative watch, as there were some concerns on the macro side. “When it comes to electricity for instance there are some major questions as well as consumer debt. The rand is also very volatile and therefore South Africa has some constraints when it comes to growth.” He said there were questions about South African resilience and therefore it remained a risk. “Because of these various constraints South Africa is not seeing the growth of other emerging markets.”