Positive rating for SA

Improved performance attributed to policy certainty after formation of GNU.

- Ina Opperman

Ratings agency S&P's outlook for South Africa announced last Friday followed on Fitch's more positive rating just before the mid-term budget policy statement last month.

Both improved outlooks were the result of policy certainty.

S&P affirmed the BB- credit rating, but changed the outlook from stable to positive and expects gross government debt to reach 80% of gross domestic product (GDP) over the coming years.

Jee-A van der Linde, senior economist at Oxford Economics Africa, says the risks to the rating agency's fairly conservative growth forecasts are tilted to the upside, with S&P noting that private sector reform could bolster economic prospects.

S&P's rating actions follow Fitch's rating affirmation which affirmed South Africa's BB- credit rating with a stable outlook.