Moody's flags modest growth outlook and persistent fiscal pressures in SA

MOODY’S Ratings has reaffirmed its existing view on South Africa's creditworthiness following a periodic review completed on 27 November 2025, cautioning that while economic conditions have improved, deep structural constraints continue to weigh on the country’s long-term prospects.

- SIPHELELE DLUDLA

The review, which did not constitute a ratings action, maintains South Africa's long-term issuer rating at Ba2 with a stable outlook.

This comes after S&P Global Ratings has announced an upgrade of South Africa’s credit rating, the first increment in almost 20 years. This upgrade signified a recognition of the country’s improved economic trajectory, buoyed by stronger revenue performance, enhanced growth prospects, and a gradual easing of pressures that have long beleaguered state-owned enterprises.

Moody’s said South Africa's rating reflects chronically low growth potential linked to ageing infrastructure, a weak labour market, and entrenched socioeconomic inequalities that complicate policymaking and fuel social tensions.