UPDATE 1-S & P holds South Africa in & # 39; junk & # 39; status and calls anemic growth | Agricultural raw materials



(Adds the response, the quote, the details of the ministry of finance)

JOHANNESBURG, 23 November (Reuters) – S & P Global Ratings has left the exchange rates of foreign currencies and local currencies in South Africa unchanged on Friday, arguing that weak economic growth and rising debt levels are grounds for keep land in the mess.

South African president Cyril Ramaphosa has made efforts to revitalize growth and persuade foreign investors since he took office in February.

But he was hampered by a power struggle in the ruling African National Congress and severe budgetary constraints after a decade of stagnation marred by policy insecurity and corruption scandals.

"Anemic economic growth in 2018 and sizeable contingent liabilities continue to put pressure on South Africa's fiscal prospects and debt burden," S & P said in a statement.

"Nonetheless, the new government is pursuing a series of economic reforms that should stimulate the economy from 2019, despite structural barriers, chronic skills shortages and high unemployment."

S & P retained the long-term currency risk of South Africa on & # 39; BB & # 39 ;, while the long-term currency for local currencies remained on & # 39; BB + & # 39 ;. The ratings have a "stable" view.

The Ministry of Finance said that S & P's rating decision gave the country "an opportunity to demonstrate further concrete implementation of measures aimed at reversing the growth trajectory".

S & P relegated in South Africa last year after a sharp deterioration of the country's public finances under former President Jacob Zuma.

ANS intends to amend the constitution to allow for ground expropriation without compensation. S & P said on Friday that it expects "the rule of law and the enforcement of contracts will largely continue and will not significantly hamper the level of investment in South Africa".

It added that it could lower its ratings if it observed a persistent fiscal deterioration, or if the rule of law or property rights were to weaken considerably.

Ratings could be increased if economic growth or fiscal results were sustainably strengthened.

Reporting by Alexander Winning
Edited by Andrew Heavens and Daniel Grebler


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