SA climbs out of junk

RECOVERY: S&P UPGRADE MARKS FIRST CREDIT RATING RISE IN 20 YEARS

- Ina Opperman

For the first time in two decades, Standard & Poor's (S&P) has upgraded South Africa's sovereign credit rating, nudging the country further from junk status and offering a symbolic boost to investor confidence.

Yet the agency's cautious tone makes clear that the road back to full investment grade remains long, fragile and dependent on reforms that must move beyond promises into tangible delivery.

The ratings agency raised South Africa's foreign currency long-term sovereign credit rating to BB from BBand its local currency rating to BB+ from BB, with a positive outlook. It also lifted the transfer & convertibility assessment to BBBand affirmed short-term ratings at B and national scale ratings at zaAAA/zaA-1+.

Prof Raymond Parsons of North-West University Business School described the upgrade as "welcome news for the economy", noting that it recognises recent improvements in South Africa's fiscal position and growth outlook.

"It strengthens investment sentiment," he said.

But Parsons cautioned that regaining full global investment status requires consistent economic steersmanship.