Water crisis could lead to credit downgrade for Cape Town

File: Moody's says two of Cape Town's main industries, agriculture and tourism, are likely to decline and reduce employment due to the water crisis. Photo: Pixabay / Falco

JOHANNESBURG - The City of Cape Town's water supply crisis is credit negative, ratings agency Moody's has warned. 

The agency currently rates Cape Town, along with South Africa, as one level above junk status.

It said if the city's water woes persist it is unlikely that Cape Town will be able to maintain its conservative debt management policies.

WATER CALCULATOR: What it's going to take to stick to Cape Town's water limits

Analysts at the agency said that two of Cape Town’s main industries - tourism and agriculture - are likely to decline and reduce employment.

The water crisis is also expected to have a negative impact on public health because of poor sanitation.

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