STATEMENT BY THE CITY’S EXECUTIVE MAYOR, PATRICIA DE LILLE
The latest annual credit rating review of the City of Cape Town has been completed by Moody’s Investors Service which has reaffirmed the existing long- and short-term national scale rating of Aaa.za/P-1.za as published by Moody’s on 13 January 2017. This rating follows closely after the City received its 13th consecutive unqualified audit report and its fourth consecutive clean audit from the Auditor-General. Read more below:
The City of Cape Town is pleased with the latest Aaa.za national scale credit rating from Moody’s where the municipality is rated at the high end of the range of South African municipalities.
Cape Town’s relative position reflects debt levels that are lower than the median of other metropolitan cities.
Moody’s noted that Cape Town compares favourably with the other rated metros in South Africa in terms of budgetary performance and management and consistently displays robust cash holdings.The City therefore has the highest possible level of credit quality within the national context.
Moody’s stated that the City’s global and national scale issuer and debt ratings reflect the City’s consistently robust budgetary performance, strong liquidity position, and low debt levels.
The financial position is supported by the administration’s prudent financial policies and its relatively large and diversified economic base.
As a result of this financial position, the City is expected to maintain its relatively strong financial position in the medium-term.
The City of Cape Town welcomes this news as it reaffirms our commitment towards building a well-run city which prioritises excellent and prudent financial management.
A favourable rating from Moody’s holds several benefits for the administration and the residents of Cape Town.
Moody’s is one of the world’s leading ratings agencies. A favourable rating gives investors confidence in the financial leadership and management of this municipality. As a result, companies that do business with the City can do so in the full knowledge that the City is able to pay its accounts.
A strong rating also allows for a lower interest rate from banks and other financial institutions, which places the City in a stronger financial position. The stronger the City’s financial position, the more resources can be allocated to our residents – in particular to those most in need of our assistance.
This rating is a welcomed boost to our efforts to attract investment so that we can create more much-needed jobs and comes on the back of Cape Town being ranked among the top cities worldwide for its foreign direct investment (FDI) strategy.
Cape Town has been ranked 21st for its FDI strategy in the Global Cities of the Future Winners 2016/17, published by Foreign Direct Investment Intelligence, a division of the Financial Times.
Cape Town is the only African city listed in this category by FDI Intelligence.