The city says Moody’s ascribes this upgrade to the improvement in the city’s operating performance and the strong liquidity position built up over the past two years.
Tshwane Mayor Solly Msimanga. Picture: @SollyMsimanga/Twitter
Moody’s upgrades the City’s credit rating one notch up and assigns it a stable outlook
7 December 2018
The DA-led multiparty administration welcomes Moody’s announcement relating to the upgrade of Tshwane’s long term rating by one notch from Ba2 to Ba1 on the global scale with a stable outlook. At the same time Moody’s also upgraded the City’s long term issuer rating to Aa2.za from A1.za on the national scale, whilst affirming the short term rating at P-1.za.
The City demonstrates very strong credit worthiness for long term commitments whilst in the short term it commands a superior ability to repay debt obligations.
Moody’s ascribes this upgrade to the improvement in the City’s operating performance and the strong liquidity position built up over the past two years. The cost cutting measures introduced by the current administration have yielded positive outcomes, seen by an improved gross operating balance (2,1%) on operating revenue per the unaudited 2017/18 financials.
This is a welcomed development for the City which no doubt will receive wide press coverage giving public confidence in the ability of this DA-led multiparty administration to manage Tshwane. Ours has always been to stabilise, revitalise and to deliver to our residents.
The upgrade means that those who want to do business with Tshwane, particularly local and international investors who buy our debt instruments, will begin to offer us discounted interest rates and better terms despite the recent rate hike by the Reserve Bank.
Our detractors do not want to see and recognize the good work that we do in this City but it is encouraging that professional institutions like Moody’s, see this City for what it is and report what they see on the ground.
This hasn’t happened in the past seven years. We are informed that this City’s liquidity position has, over the past two years, improved due to enhanced operating performance in which our Financial Sustainability Plan has played a big part.
We have implemented cost cutting measures without compromising on service delivery and thus we have significantly stretched the spend in each Rand to benefit our people.
This credit rating is testament to this administration’s commitment to building a capable city that can deliver services to our people.
Tshwane MMC for Finance
083 457 7919
Spokesperson to the Executive Mayor of Tshwane
078 231 5977