The resilience shown by the South African economy since re-escalation of the US-Israel and Iran war, with the rand holding up better than it has during past global shocks, is a direct result of a deliberate build-up of policy credibility, says business organisation Business Leadership South Africa (BLSA) CEO Busisiwe Mavuso.
This build-up includes a lower inflation target, a primary budget surplus that has been widening since 2023/24 after 15 years of deficits and a planned fiscal trajectory that will see government debt peak at 78.9% of GDP this year before falling towards 75% by the end of the decade, she points out in her latest weekly newsletter.
The fiscal discipline has also brought credit rating upgrades, with ratings agency S&P upgrading South Africa's long-term foreign currency credit rating by one notch in November 2025, which was its first upgrade in two decades.
Similarly, ratings agency Moody's revised its outlook from stable to positive in late May and ratings agency Fitch upgraded South Africa's long-term credit rating on June 5, which was its first upgrade in 21 years.
Reforms in the financial sector have added to this resilience, particularly those related to the global antimoney-laundering and combating the financing of terrorism initiative Financial Action Task Force requirements, says Mavuso.
