CAPE TOWN May 9 South Africa needs to provide
policy clarity to boost investor confidence, after a cabinet
reshuffle and a pledge to introduce "radical economic
transformation", Finance Minister Malusi Gigaba said on Tuesday.
Gigaba's comments echo those of President Jacob Zuma about
redistributing wealth, which remains largely in the hands of the
white minority more than two decades after apartheid ended,
raising uncertainty about South Africa's policy direction.
"We know that we need to continue acting conscientiously to
do what we have to do, including providing policy clarity on a
number of areas ... to boost business and investor confidence,"
Gigaba told parliament's finance committee.
Both S&P Global Ratings and Fitch downgraded South Africa's
credit rating to below investment grade last month, citing
likely changes in economic policy after Finance Minister Pravin
Gordhan was fired, shaking investor confidence.
Lower ratings typically make it more expensive to borrow,
particularly when they fall below investment grade, and risk
deterring the foreign investors on whom South Africa relies to
finance its big budget and balance of payments deficits.
"The debates around radical economic transformation are
ongoing," Gigaba told the finance committee. "How do you get the
majority of South Africans ... to participate in the economy, to
own some assets, to become self-sustaining?"
He said the ruling African National Congress, which steers
government policy, had not yet defined what the transformation
(Reporting by Wendell Roelf; Editing by James Macharia, Larry