City of Tshwane Metro Municipality

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City of Tshwane Metropolitan Municipality (2022-04)
  • City of Tshwane Metro Municipality
  • Year : Apr 2022
3 Tokens
USD 300.00
Summary

Tshwane’s operating performance was severely impacted by liquidity constraints during 2H FY21. Cash inflows had declined as a result of poor collections during the COVID-19 pandemic, but expenditure did not reduce, resulting in a substantial decline in cash generated by operations. The Metro also incurred R1.6bn in backdated staff costs, which\ consumed much of its cash reserves. As a result of the deteriorating liquidity position, the Metro was unable to secure additional facilities that had been budgeted to meet year-end obligations.

Additional Information

The positive outlook reflects GCR’s opinion that, if successful, initiatives to improve liquidity will help stabilize the financial profile over the medium term. Positive rating action could emanate from a meaningful increase in cash inflows that allows Tshwane to meet operating and capex requirements, whilst restoring its liquidity buffer. Renewed access to financial markets will also be positively considered.

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