I read the Fitch statement (I think) and my reading of it was the frustration the agency had with gov not meeting it’s own self-defined targets for fiscal consolidation. It’s not all ‘wasted 9 years’. A lot of the feedback is that the agencies don’t believe in the current action.
If everything about the ratings announcement was backward-looking we’d know the rating and not need to wait till midnight for statements. Agencies are looking for progress, and they are saying they can’t see it.
And we know that a critical issue is the wage bill, and taking two years to still not have a decision is a huge part of the negative outlook. Otherwise those statements downgrades can just be labelled Covid19-adjustments.
“Govt launched Recovery Plan focused on boosting infra investment, energy supply, job creation...But track record of implementation of earlier reform initiatives has been relatively weak & even if implemented, the effect of reforms would be limited”. This is in recent tense.
“the track record of implementation of earlier reform initiatives has been relatively weak and, even if implemented, the effect of the reforms would be limited and take time to accumulate.”. This is feedback on reforms, not ‘the 9 years were crap now we are punishing you’

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More from @Ms_ZamaNdlovu

21 Nov
Accountability is not demonising. The problem when you choose sides instead of choosing the principle is that when it’s NT or SARB it becomes an attack and when it’s departments you don’t like it becomes accountability. These are constitutional mandates we are talking about.
National finances are political and political principal must take responsibility, regardless of how friendly y’all are with him.
And the president has the power to appoint and hire cabinet ministers who don’t perform. How is Gwede still there when he’s not moving on energy? Political will. Honestly, all your faves are a problem, you don’t get to choose where accountability should flow.
Read 4 tweets
14 Aug
Many of you will never understand how much of a Grootman Broke My Heart story this Brian Molefe saga has been.
Brian Molefe was the blue-eyed boy of the ANC. First, as the technocrat star of the pre-2007 administration and Zuma administration. He could do no wrong.
He was also the first real grootman of the corporate future leaders cohort of black (male) talent, particularly in the finance space. And boy did they twirl.
Read 10 tweets
11 Jan
10 years ago, we were complaining about growing at 3% (China grew by 10+% in 2010, Brazil 7.5%, Nigeria close to 8%). We were underachieving because of Eskom.

Now, same problem but growth projections are at 0.9% because problems that don’t get fixed evolve and get worse.
In the meantime, since SA first experienced power shortages, the economy’s structure has changed. Industries that hire unskilled and semi-skilled people are typically energy-intensive primary and tertiary sector industries. Can’t build factories without power.
Look at this snapshot. Sectors that employ semi-skilled and unskilled all about are struggling. You really cannot say that you want to address the unemployment crisis in SA while tinkering on resolving the energy crisis.
Read 6 tweets
29 Dec 19
Youth unemployment is 100% a structural issue, however, graduates not being taught entrepreneurship is not the problem. That narrative adds to the overall pitch that young people must solve a problem they didn’t create.
I’m going try explain something that I’ve been trying to understand for three years. Bear with me if it’s confusing.

We are all taught that the banking sector’s role in society is to coordinate excess funds with demand for funds, largely for commerce or ‘the real economy’.
But actually, since about the late 1970s, deregulation changed this. The simplest explanation is that deregulation allowed different forms of financing, putting banks under pressure and making them look for alternative markets for profit else where —-> individuals.
Read 16 tweets

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