NEW: What a downgrade will mean for you‚ me and South Africa

Ratings agency Moody's has placed South Africa on review for its sovereign credit rating‚ and Moody's analysts will be visiting the country a week from now to make a final decision on the country's creditworthiness.

If Moody's is not satisfied that South Africa will be able to strengthen its financial position in the medium term the agency will drop our credit rating to one notch above speculative or "junk" status.

Here's what this means for us:

In simple terms‚ if South Africa were a person with an income‚ debt obligations and a budget to manage repayments of that debt‚ our salary is going down while our costs of debt are rising. What South Africa makes from exports of commodities has been slashed by a weak global economy that just doesn't want to buy our raw materials.


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