Ratings agency Fitch Ratings has affirmed South Africas long-term foreign and local currency debt ratings at BB- and maintained the stable outlook.
It said in a statement on Friday that South Africa's rating is constrained by low real gross domestic product (GDP) growth, a high level of poverty and inequality, a high government debt/GDP ratio and a rigid fiscal structure that hampers deficit reduction.
The ratings were supported by a favourable debt structure strong institutions and a credible monetary policy framework, it said.
Fitch forecast low real GDP growth of 0.9% in 2024, 1.5% in 2025 and 1.3% in 2026, against 0.7% in 2023.
Growth is hampered by a struggling logistics sector, deeply entrenched structural factors, particularly high levels of inequality, poverty and unemployment and weak investment. We expect the weakness to persist, despite robust demographics. Electricity shortages, which dragged on growth in 2022 and 2023, are expected to ease, but sporadic incidents of load-shedding could still occur, it said.
