Mayor of Ekurhuleni Tania Campbell is optimistic that the City is on a positive trajectory towards financial stability.
“I am pleased to inform the residents of the City that the Global Credit Rating Company (GCR) has assigned the city’s ratings of BBB(za) and A3(za), respectively, with effect as of April 20.
“This adjustment means the City’s rating outlook has changed from negative to stable,” explained Campbell.
The mayor stated that according to GCR’s report, the revised outlook is based on the City’s adjusted medium-term budgets.
“We are also the only metropolitan municipality to have received a clean audit outcome from the auditor-general over the previous financial year.
“Furthermore, GCR has noted the enhanced levels of operational controls within the metro, which support initiatives to strengthen the institution’s financial position.”
Campbell said the positive credit rating adjustment is a testament to the effectiveness of the multi-party coalition government’s back-to-basics philosophy.
“The City’s ability to sustain positive credit rating opinions enables the city to borrow money at a lower interest rate. These lower interest rates save the taxpayer money when we service our debt.
“I wish to commend the administrative leadership of the City, under the city manager and the group chief financial officer on this milestone,” said Campbell.
The mayor pointed out that the administration’s alignment to the multi-party coalition government’s vision is starting to bear fruits for the City.
“The healthy financial foundation will allow the City to develop resilience against possible future economic shocks and act as a basis for the metro to revitalise infrastructure across the City for a sustainable future.”
The DA in Ekurhuleni welcomes the announcement by the credit ratings agency.
City of Ekurhuleni gets a clean bill of health from auditor-general
DA Deputy Chief Whip Brandon Pretorius said credit ratings agencies, such as GCR, provide important advisory services on the viability and attractiveness for investment based on the financial health and situation of an entity.
“GCR’s assignment of stable to the City’s outlook should thereby be welcomed and is a testament to the multi-party coalition governing’s commitment to financial prudence and stability of the City’s finances.
“Importantly, a stable credit rating outlook could potentially be a precursor for increased investment in the City, resulting in an improved environment to do business and ultimately aid positively in job creation,” said Pretorius.
Pretorius added the awards are a welcome turnaround after the metro was downgraded by Moody’s Rating Agency to negative in July on the back of downside risks related to the City’s liquidity position and weak operating performance, which was exacerbated by the socio-economic impact of the pandemic.
“Given the current political and economic context, the DA applauds the government’s efforts in securing this favourable investment outlook.
“Salvaging the urgent position that the previous ANC-led coalition government left the City’s finances in the previous administration has posed major challenges for the current multi-paty government, but this latest investment rating provides evidence that the back to basics approach is paying dividends which will ultimately improve the City’s ability to provide services to its residents,” said Pretorius.
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