2 Again, any drop in the value of these financial assets would undermine the efforts aimed at creating wealth through such savings vehicles. Finally, rating downgrades cast general doubts on the long-term economic and financial health of a country. This is because downgrades typically weigh on business confidence, undermining companies’ willingness to invest in new productive capacities and boost the size of their workforce.
At worst, businesses fearing a worsening economic future may shed jobs, resulting in an overall decline in the number of employment opportunities throughout the country. In South Africa, unemployment exceeds 27% of  2 See ‘Investments in stokvels gaining ground’ published on the Fin24 website on 9 July 2014.