Today's Big Stories

Ratings agencies cast doubt on governance at SOEs

Ratings agency Moody’s has warned that it could cut the ratings of five State-owned agencies (SOEs), including Eskom as a result of funding risks.

Moody’s placed Eskom, Sanral, the Industrial Development Corporation (IDC), the Land Bank and the Development Bank of Southern Africa (DBSA) under review.

It raised concerns over the decision by some local institutional investors to stop lending to parastatals.

Economist Dr Iraj Abidian explains that the prospects of cash flow from SOEs are not robust enough to give assurance to lenders and investors.

Asset manager Futuregrowth announced this month that they have cut lending to several State-run firms due to political uncertainty and governance issues.

Those who are running the institutions have, themselves, created doubt about their own credibility by being under a long string of political manipulations.

Dr Iraj Abidian, Economist at at Pan-African Capital Holdings

Listen to the full conversation from CapeTalk's Breakfast with Kieno Kammies:

At the same time, financial expert Sikonathi Mantshantsha warned against the the power struggle between President Jacob Zuma and Finance Minister Pravin Gordhan over spending at State-owned companies.

Zuma announced that he would have oversight over a newly formed presidential SOE coordinating council.

That means he would make all the decisions concerning these SOEs. It's like the fox guarding the chicken coup that we paid so many millions for at Nkandla.

Sikonathi Mantshantsha, Deputy Editor at Financial Mail

Listen to the full conversation from CapeTalk's Breakfast with Kieno Kammies:


This article first appeared on 702 : Ratings agencies cast doubt on governance at SOEs


Recommended

by NEWSROOM AI
Read More
Veterans and ANC not on same page about terms of consultative conference

Veterans and ANC not on same page about terms of consultative conference

ANC vets want civil society groups present at the consultative conference, which they want held separately from another meeting.

Top SABC journos applauded for brave testimony

Top SABC journos applauded for brave testimony

EWN's Gaye Davis summarises the evidence of the SABC journalists who appeared before the ad hoc committee in Parliament.

If you're gona be a hero (and smash a car window), make sure you can prove harm

If you're gona be a hero (and smash a car window), make sure you can prove harm

A criminal lawyer explains what leg citizens can stand on if they witness a child or pet locked in a vehicle in risky conditions.

'SOEs are failing because the board of directors are not competent'

'SOEs are failing because the board of directors are not competent'

Bruce Whitfield interviews former Denel CEO Shaun Liebenberg about the imminent downgrade of five State Owned Enterprises.

SA credit ratings downgrade review by Moody's expected, says economist

SA credit ratings downgrade review by Moody's expected, says economist

Economist explains why ratings agency Moody's has placed South Africa on review for a downgrade. How do we avoid junk status?

How do we restore confidence in SOEs?

How do we restore confidence in SOEs?

Professor of Economics at North West University Business School, Raymond Parsons spoke to John about the state of parastatals.

Popular articles
SA braces for horrific fuel price increases as oil hits 4-year high

SA braces for horrific fuel price increases as oil hits 4-year high

It's monstrous! The Money Show’s Bruce Whitfield interviews the Automobile Association of South Africa's Layton Beard.

Dros rape: 'He was sitting near the kid's play area...he had his eye on her'

Dros rape: 'He was sitting near the kid's play area...he had his eye on her'

The man allegedly attacked the six-year-old inside a toilet cubicle at a Dros franchise in Pretoria on Saturday.

New visa rules a relief for our economy and for jobs, says WC MEC

New visa rules a relief for our economy and for jobs, says WC MEC

The Western Cape government and SA Tourism have welcomed the amendments to South Africa's visa regulations.

'She says I'm just waiting for this c**lie to move so I can take the photo'

'She says I'm just waiting for this c**lie to move so I can take the photo'

A caller on the Eusebius McKaiser Show, Zeenat says she was called a derogatory word for Indian on Heritage Day.

'This leaked document is calling a spade a spade'

'This leaked document is calling a spade a spade'

Breakfast Show Host Bongani Bngwa shares his views on the leaked report from the Thabo Mbeki Foundation.