It's D-Day for South Africa's possible credit rating downgrade

All eyes are on the markets in South Africa as S & P is expected to make a decision on whether to downgrade the country's credit rating.

SA's economy has endured a tumultuous ride since the removal of former Finance Minister, Nhlanhle Nene, which saw the rand plunge to record lows in a matter of days.

702's John Robbie spoke to Chief Economist at Standard Bank, Goolam Ballim, on his comparative study on countries that have been downgraded to sub-investment grade (junk status).

His study looked at Brazil, Bulgaria, Croatia, Hungary, Russia and Romania.

Listen to the interview below:

If you consider that 20 years ago, South Africa had the risk of sub-investment, and we ascended to having a very strong credit quality.

Goolam Ballim, Standard Bank Chief Economist

Ballim said a downgrade would affect the potential of capital investment, the type of growth rate and the cost of borrowing for the country.

Whether we get downgraded or not, what is critical is that there is a potential for a revisit of the character of our policits and a focus on the government to remain dutiful in service.

Goolam Ballim, Standard Bank Chief Economist

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