South Africa must implement economic reforms urgently to avoid losing its last remaining investment-grade credit rating and having to resort to bailouts from multilateral lenders, the nation’s main business-lobby group said.
South Africa “desperately needs” policy changes to revive flagging economic growth, reduce growing unemployment and rein in government debt, Business Unity South Africa President Sipho Pityana said in a speech to a conference in Sandton on Tuesday.
Priorities include security of energy supply, the reform of state-owned enterprises and appointment of competent leaders to manage those businesses, he said.
Pityana’s comments echo those by Finance Minister Tito Mboweni last week, when he warned a credit-rating downgrade was unavoidable unless the state ramps up structural reforms.
“The minister of finance hit the nail on the head in his latest warning that we are running out of time, and we need all hands on deck to avoid a sovereign downgrade and the extreme pain that would follow bail-outs from entities like the International Monetary Fund,” Pityana said.
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