South Africa Achieves First Major Credit Rating Upgrade in Nearly Two Decades

South Africa has received a significant boost in its economic outlook as S&P Global Ratings upgraded the country’s long-term foreign currency sovereign credit rating from BB- to BB, marking the first upgrade by a major rating agency in over 16 years. This decision, announced on November 14, 2025, follows the tabling of the Medium-Term Budget Policy Statement (MTBPS) and reflects improved fiscal management and structural reforms, particularly in the energy sector.

South Africa secures first major credit rating upgrade in 16 yearsS&P Global Ratings Upgrades South Africa’s Credit Outlook for First Time in Nearly Two DecadesRatings agencies see SA's medim-term growth rebounding above 1.5% on reform momentum

S&P's upgrade is attributed to a more stable growth trajectory, with projections indicating a real GDP growth of 1.1% in 2025, up from 0.5% in 2024, and an average of 1.5% from 2026 to 2028. The agency noted that ongoing reforms in electricity, logistics, and other sectors are expected to support this growth. However, S&P's forecasts are slightly more conservative than those of the National Treasury, which anticipates growth rates of 1.5% and 1.8% for 2026 and 2027, respectively.

S&P upgrades South African rating

The upgrade reflects a positive outlook for the South African rand and a stabilizing debt burden, primarily due to improvements at Eskom, the state-owned power utility. S&P highlighted that Eskom's operational performance has improved, reducing the contingent liabilities that have historically constrained South Africa's ratings. The government is projected to achieve its third consecutive primary budget surplus in the 2025/26 fiscal year, a key indicator of fiscal discipline.

Credit rating upgrade sparks praise as Treasury hails first ratings boost in 16 years

The National Treasury welcomed the upgrade, stating it signifies a meaningful improvement in the country’s growth prospects and public finances. Finance Minister Enoch Godongwana emphasized that the government’s commitment to fiscal sustainability and infrastructure investment will bolster economic growth and reduce borrowing costs. The African National Congress (ANC) attributed the upgrade to accelerated economic reforms and improved performance of state-owned enterprises, particularly in the energy sector.

Credit rating upgrade sparks praise as Treasury hails first ratings boost in 16 years

Despite the positive developments, some analysts caution that significant challenges remain. The Democratic Alliance (DA) acknowledged the upgrade but urged the government to maintain momentum on structural reforms to avoid bureaucratic delays. DA deputy finance spokesperson Wendy Alexander warned that South Africa remains two notches below investment grade and emphasized the need for responsible spending and improved governance.

Credit rating upgrade sparks praise as Treasury hails first ratings boost in 16 years

While S&P's outlook is positive, it remains cautious about South Africa's low per-capita income and high public debt levels. There are discrepancies in growth forecasts between S&P and the National Treasury, with S&P projecting lower growth rates for 2026 and 2027 compared to the Treasury's estimates.

S&P upgrades South African rating

The upgrade positions South Africa favorably as it prepares to host the G20 Summit on November 18-19, 2025. This event will provide an opportunity for the country to advocate for debt relief and green funding for Africa, further enhancing its international economic standing.

S&P Global Ratings Upgrades South Africa’s Credit Outlook for First Time in Nearly Two Decades

• “The positive outlook reflects the potential for further improvements in fiscal metrics and government debt stabilization if the coalition government continues its fiscal consolidation,” — S&P Global Ratings

Ratings agencies see SA's medim-term growth rebounding above 1.5% on reform momentum

• “This is a clear signal that since the DA has been involved in managing the budget, we’re turning the fiscal corner after almost two decades of ANC damage,” — Wendy Alexander, DA Deputy Finance Spokesperson

Credit rating upgrade sparks praise as Treasury hails first ratings boost in 16 years

• “Based on our fiscal credibility, the S&P has come back and says ‘you are doing well insofar as managing your fiscus is concerned.” — David Masondo, Deputy Finance Minister

ANC welcomes South Africa’s ratings upgrade by S&P Global