A credit rating downgrade to sub-investment grade or junk status will cause rand weakness, push SA into a recession and lead to the loss of at least 200,000 jobs, Standard Bank chief economist Goolam Ballim warned on Monday.

A downgrade would see SA’s gross domestic product (GDP) decline by 0.3% in 2016. In the absence of a downgrade, however, the economy would likely grow by 0.6%, he said.

“I have the hope that Standard & Poor’s (S&P) leans heavily towards the qualitative elements within the assessment and provides SA with a reprieve and I do think it is both probable and plausible,” Ballim said.

S&P, which rates SA’s international credit rating at just one notch above sub-investment grade, will review SA on June 3. The agency rates SA’s credit rating at BBB- with a negative outlook while Fitch also rates SA at the same level but with a stable outlook. Moody’s has already made its decision this month and left SA’s rating unchanged two notches above sub-investment grade at Baa2 with a negative outlook.

If Finance Minister Pravin Gordhan quit his position or was sacked, there would be a “rerun” of the financial market fallout that occurred in December 2015 when the rand tanked following the firing of then finance minister Nhlanhla Nene.

SA had lost out on R725bn worth of gross domestic product and creating 1.4-million job opportunities in 2015 due to the lingering consequences of the global financial crisis as well as local factors such as electricity constraints and politics.