Johannesburg’s Credit Rating Placed on Downgrade Watch by Moody’s. Johannesburg, South Africa — Rating agency Moody’s Investors Service has placed the City of Johannesburg on a credit downgrade watch, citing ongoing financial challenges and governance concerns. This decision follows the Johannesburg Stock Exchange’s (JSE) suspension of the city’s listed debt securities due to the city’s failure to publish its audited financial statements for the year ending 30 June 2025.
The current credit rating for the City of Johannesburg stands at Ba3, which is below investment grade and considered ‘junk’status.
The rating agency has emphasized that the city has not defaulted on its debt repayments; however, the JSE’s action has disrupted the city’s access to markets to raise funds. Last year, the Auditor General’s office flagged R1-billion in irregular spending at the city, expressing concerns over contracts awarded to companies with ties to city officials.
The downgrade watch is primarily driven by issues of governance, including transparency and timeliness in financial reporting.
Additionally, the city has been involved in audit disagreements with the Auditor — General over infrastructure asset accounting, further complicating its financial situation. Moody’s perspective underscores the importance of robust financial governance and transparency, while political groups like ActionSA warn about the potential impact on service delivery and infrastructure maintenance.
The JSE’s suspension of the city’s debt instruments highlights immediate market access and liquidity concerns.
As South Africa’s largest economic hub, the City of Johannesburg has faced financial challenges, including budget deficits and infrastructure issues, raising concerns about its ability to manage debt and provide essential services.
The potential downgrade by Moody’s serves as a stark reminder of the critical need for sound financial management and governance.
The outcome of this situation is likely to have significant implications for the city’s financial health and its ability to deliver services to its residents.
*Additional reporting by ImNews*
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By This original article was produced by the ImNews editorial team
Source: enca
Source: Nokuthula Khanyile
