Africa-Press. A local source reported that improvements in financial performance in South Africa and the momentum of reforms are expected to help stabilize government debt this year before it gradually declines.
The source noted that rising revenues, expenditure control, and improved financing costs are all factors supporting the positive shift in credit ratings, despite the fact that debt exceeding 80% of GDP still limits the government’s ability to absorb shocks. South Africa has been assigned a rating of “Ba2” with a stable outlook.
The source anticipates that the general government deficit in South Africa will decrease to 4.3% of GDP in 2026 and 3.8% in 2027, down from 4.5% in 2025. The primary surplus is expected to rise to 1.8% of GDP in 2027, which is higher than the estimated 1.5% needed to stabilize debt.
The local source estimated that general government debt peaked at 86.8% of GDP in 2025 and is expected to gradually decline to 84.9% by 2028. Interest payments accounted for 18.8% of general government revenues in 2025.
The source stated that South Africa’s shift to a lower inflation target of 3%, with a 1 percentage point margin, is expected to help reduce risk premiums and financing costs. The rating agency expects real GDP growth to gradually rise to around 2% by 2028 from 0.5% in 2024, supported by increased investment and resilient consumption.
