S&P downgrade could have been averted - Nhlanhla Nene

Former Finance Minister Nhlanhla Nene recently joined CNBC Africa to discuss the recent S&P downgrade of South Africa's credit rating. Nene expressed his disappointment at the downgrade, emphasizing that it was a situation that could have been avoided. As someone who had dedicated significant time and effort during his tenure at the Treasury to prevent such a downgrade, Nene's insights shed light on the implications of this development for the South African economy. He highlighted the cascading effects of the downgrade, predicting challenges in recovering from the investment grade loss. Nene also touched upon the impact on the currency market, particularly the vulnerability of the Rand, which has shown volatility post the downgrade. He expressed concerns about the increased cost of borrowing and the potential strain on the country's finances, diverting funds away from critical sectors like infrastructure, education, and healthcare. Additionally, Nene addressed the role of former Finance Minister Pravin Gordhan, suggesting that Gordhan's continued leadership may have prevented the downgrade. Despite the current challenges facing South Africa, Nene remains cautious about the road ahead, underscoring the need for a concerted effort across the government to navigate this turbulent financial landscape. The conversation also delved into the implications of the downgrade for the average citizen, emphasizing how it could impact everyday life through increased debt servicing costs and reduced government spending on essential services. Nene's candid responses painted a sobering picture of the economic challenges facing South Africa post the S&P downgrade, urging for collective action and prudent decision-making to steer the nation back on course.