The cost of protecting the nation's debt against non-payment using credit default swaps has climbed 14 basis points since 15 August, a day before police shot dead 34 striking mineworkers.
Cuts in output of platinum, which accounts for 8% of South African exports, may cut growth and government revenue, heightening the risk of a credit-rating downgrade. "There could be some kind of shift in the whole social situation," said fund manager Lars Nielsen. "It's clearly something that we are following quite closely. That could mean we would lower our exposure a bit to South Africa." Economic growth is coming under pressure as the debt crisis in Europe curbs demand for exports.
According to Mineweb, Pierre du Toit, professor of political science at Stellenbosch University said that Zuma "is the only person I've heard saying that confidence wasn't hurt," adding that "South Africa's credit rating is at stake."
Read the full article on www.mineweb.com/mineweb
