Economists with Moody's Investor Services have warned that constant strike action in South Africa could severely tarnish country's reputation, especially after hosting the most economically successful FIFA World Cup in history.
Moody's Analytics, , a subsidiary of Moody's Investors Service, said that due to the labour unrest, which seems to be getting worse, the damage done to South Africa's reputation as an investment destitution could be lasting.
The credit ratings agency urged South Africa to keep business conditions stable in order to boost the country's global profile.
Civil servants recently went on a three-week strike demanding better wages and a higher housing allowance. The workers were asking for an 8.6% increase and a R1000 housing allowance. The strike has, however, been suspended and government sticking with its 7.5% wage increase offer along with R800 housing allowance.
In the biggest strike the country has seen since 2007, police had to take action with rubber bullets and water cannons as strikers turned violent, threatening those who were working and ignoring ailing patients. It's expected that the strike cost the economy around R1billion each day.
The strike had no impact on the South African bond, stock and currency markets, though and the Rand hit a 30-month high against the dollar on Monday, September 13 when the rand traded at 7.1550 to the dollar at 07:51.
Moody's: Strike could damage SA's reputation
16 Sep 2010
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