S&P Global Ratings has delivered a major boost to South Africa’s economic credibility, upgrading both its foreign and local currency sovereign credit ratings amid signs of stabilizing reforms and improved growth momentum. On November 14, 2025, the agency raised South Africa’s foreign currency long-term sovereign rating to ‘BB’ from ‘BB–’, and its local currency rating to ‘BB+’ from ‘BB’, while maintaining a Positive outlook on both. This marks a significant milestone in the country’s post-pandemic recovery and reflects growing confidence in structural reforms—particularly in resolving the long-standing electricity crisis. The South Africa S&P credit rating upgrade is the first such dual upgrade in over a decade.
The decision follows a series of upgrades to state-owned entities announced the previous week, including Eskom and Transnet, signaling that international investors are beginning to recognize tangible progress in governance and service delivery. S&P cited modest but consistent improvements in real GDP growth, better-than-expected fiscal performance, and meaningful reforms in critical infrastructure sectors as key drivers behind the move.
“South Africa’s reform trajectory, particularly in restoring power supply reliability through Eskom’s operational stabilization, has reduced macroeconomic vulnerabilities,” S&P stated in its report. “We expect this trend to support stronger investment, improved business confidence, and a more sustainable fiscal path.”
For years, load-shedding—the rolling blackouts caused by Eskom’s failing power grid—was the single biggest drag on economic activity, deterring investment and disrupting daily life. But since mid-2024, coordinated efforts to bring private energy online, reduce technical losses, and improve maintenance have led to nearly uninterrupted power supply for over nine months—a record in recent history.
This stability, combined with reforms in rail and port logistics at Transnet, has helped ease bottlenecks in trade and manufacturing. Business sentiment indices have turned positive, and foreign direct investment inflows rose by 32% year-on-year in Q3 2025, according to National Treasury data.
The South Africa S&P credit rating upgrade also reflects improved debt dynamics. While public debt remains high at around 72% of GDP, S&P now expects it to peak in 2026 before gradually declining—contingent on continued reform momentum. The Positive outlook indicates a strong possibility of another upgrade within the next 12 to 18 months if reforms are sustained.
“This is not just a rating change—it’s validation,” said Finance Minister Enoch Godongwana. “It shows that our work to fix state-owned enterprises and restore investor trust is working.”
However, challenges remain. Unemployment still hovers above 32%, inequality is entrenched, and political uncertainty ahead of upcoming elections could test policy continuity. S&P warned that any reversal in reform pace or escalation in social unrest could stall further upgrades.
Still, the message from Wall Street to Sandton is clear: South Africa is back on the radar.
And with global capital markets watching closely, this South Africa S&P credit rating upgrade could unlock cheaper borrowing costs, strengthen the rand, and pave the way for renewed investment across infrastructure, green energy, and digital transformation.
Because when the lights stay on, so does confidence.
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