Shortly after South Africa had its foreign investment rating knocked down a few pegs, state-owned entity Transnet was also dealt a blow.

The freight and logistics company recently had its long-term foreign and local currency ratings downgraded by S&P Global Ratings to subinvestment grade.

Due to the company’s stable finances, its standalone credit profile was kept at BBB.

In a statement, the company’s CEO Siyabonga Gama said that “S&P’s affirmation and acknowledgement of the critical role that Transnet plays in SA’s economy as a provider of essential infrastructure services is testament of the strong and agile manner in which Transnet management is navigating the tough macroeconomic challenges”.

S&P said Transnet’s liquidity was still adequate and acknowledged the sound relationship it has with South African banks, its good standing in capital markets, its sufficient risk and management framework and its unused credit facilities.

The company’s chief financial officer Garry Pita said Transnet had more than R16bn in unused short-term credit facilities and long-term funding of more than R15bn. He added that this, along with access to domestic and global capital markets, amounted to about R93bn to meet the company’s funding commitments.

Transnet is currently focusing on the improvement of its rail, port and pipeline infrastructure, however after the downgrade, it said it was going to reconsider its investments for this financial year.

Taking the downgrade into consideration, Transnet expects to spend approximately R273bn over the next six years.