Monday afternoon revealed the news that, credit rating agency Standard & Poor (S&P), has downgraded South Africa’s credit rating to junk status. The agency retains a ‘negative outlook’ on South Africa, meaning that the likelihood of an upgrade anytime soon is quite slim. The downgrade has sent the value of the South African Rand tumbling and incited widespread concern amongst the citizenry.
In its statement, S&P indicated that the decision to downgrade was taken soon after the shocking cabinet reshuffle by President Jacob Zuma, most notably and critically relieving the respected Minister of Finance Pravin Gordhan, of his post.
S&P stated “In our opinion, the executive changes initiated by President Zuma have put at risk fiscal and growth outcomes.” Pravin Gordhan was a critical addition to Zuma’s administration, as he often disapproved of Zuma’s controversial and economic policies. A vocal anti-corruption advocate, Gordhan was instrumental in increasing the value of the Rand, after it slumped to a record low in 2016.