Pravin off to sell SA again

16 September 2016 - 08:23 By SHAUN SMILLIE and BLOOMBERG

Finance Minister Pravin Gordhan will soon be back on the road, yet again peddling his message that SA Inc is open for business as Moody's threatens to downgrade the credit ratings of several state-owned entities.The Treasury, the Johannesburg Stock Exchange and major banks will meet investors in the US next month as ratings agencies prepare to review the nation's creditworthiness."The goal of the investor conference is to engage US investors, making it clear that South Africa is open for business," said the JSE's director of marketing and corporate affairs, Zeona Jacobs.This will be the second delegation in less than six months to be led by Gordhan in an attempt to bolster confidence in the South African economy. This time around many believe that he will not have an easy sell. SACP behind GordhanThe SA Communist Party has come out in support of Finance Minister Pravin Gordhan, saying the Hawks' investigation into him is an attempt to weaken the Treasury.Economist Azar Jammine warned that, although there had been improvements in the economy, domestic and foreign investors feared that if Gordhan lost out in the "cabinet war" and was fired it would trigger a series of credit ratings downgrades.But another economist, Roelof Botha, was more sanguine."It's going to be easier this time around," he said. "Commodity prices have lifted off, ending a six-year downturn. And we are going to have a 2% growth rate next year," he said.Botha said public expenditure had become stable and predictable.Pravin Gordhan: Budget 2013All the news from Finance Minister Pravin Gordhan's Budget Speech.A downgrading of South Africa's sovereign debt to junk status could spark a wider emerging-markets sell-off and lead to a 10% drop in the rand against the dollar, said Lutz Roehmeyer, a money manager at Landesbank Berlin Investment.Moody's said on Wednesday that it had placed Eskom, Sanral, the Industrial Development Corporation, the Development Bank of Southern Africa and the Land Bank on review for a downgrade.Eskom said it planned to talk to Moody's about its decision.The agency said it had placed the utility on review because of higher spending on power stations.It said Sanral had been put on review because of "cash flow pressure" related to its e-toll payments ."Road users barely utilised the opportunity to clear their debt during a recent six-month window to settle e-toll fees at a discount," Moody's said.President Jacob Zuma is to convene a meeting of the Presidential CEOs Initiative today...

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