Come on, Moody’s, give SA a much-needed mood boost

Business

Come on, Moody’s, give SA a much-needed mood boost

It could announce on Friday that it’s degrading us to junk, but there are good, logical reasons why it may not

Raymond Parsons

SA took a major decision affecting its economy this week: a drastic 21-day lockdown from Friday to deal with Covid-19. The next important event immediately affecting SA’s economic future will be Moody’s Investors Service’s scheduled decision on SA’s investment rating, due later on Friday.

Some may think whatever Moody’s decides is now peripheral to the main economic challenges faced by SA, but the outcome cannot be completely detached from the unfolding wider scheme of things. SA must hope to minimise bad news wherever possible.

What are we up against? It will clearly take time before the full effect of Covid-19 can be fully assessed, but it is already obvious that the world economy and SA are experiencing an unprecedented economic shock, even exceeding the 2008 Great Recession. The parameters of action and response have fundamentally shifted for all decisionmakers, whether individual or institutional...

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