S&P signals possible South Africa ratings upgrade within a year

In its most recent action S&P upgraded South Africa's foreign currency rating to BB

- SIPHELELE DLUDLA AND TAWANDA KAROMBO

IN ITS RATINGS review in November, S&P pointed to accelerating reform momentum, particularly under the second phase of Operation Vulindlela launched in 2025. The programme targets structural reforms in local government, electricity, water, logistics, digital transformation and spatial inequality.

(I LEON LESTRADE Independent Newspapers)

S&P Global Ratings could raise South Africa's sovereign credit rating within the next year if fiscal imbalances improve and reform momentum is sustained, the ratings agency told Business Report exclusively on Thursday.

In its most recent action, S&P upgraded South Africa's foreign currency rating to BB and affirmed its local currency rating at BB+, assigning both a positive outlook. This places the country just one notch below investment grade.

The ratings agency has now indicated that it intends to resolve the positive outlook “broadly within a year”, opening the door to a potential upgrade that could further enhance South Africa's appeal to international investors.

“We could raise the ratings if fiscal imbalances reduce more significantly than we currently expect, supported by an improving track record of effective reforms that further strengthen economic growth and reduce contingent liabilities,” said Ravi Bhatia, S&P’s lead analyst on South Africa.