National Treasury said the Moody's ratings decision proved that if South Africans work together, “remarkable outcomes can be achieved”.

Moody’s kept South Africa’s long term foreign and local currency debt ratings at ‘Baa3’, one notch above sub-investment grade, on Friday night, after placing the country on a 90-day review for a downgrade in November last year.

The ratings agency, which is the only one of the three major institutions to have South Africa at investment grade, cited changes in the political arena, the strengthening of key institutions, improved economic growth and commitment to fiscal consolidation as reasons for its decision.

There were however some concerns related to the manner in which government will handle increased pressure on spending and balance attracting investment, while trying to alleviate poverty.

“The government fully recognises Moody’s assessment of challenges and opportunities the country faces in the immediate to long-term,” Treasury said in a statement late on Friday night.

The government also thanked all the sectors who had contributed to the “positive rating outcome” and that President Cyril Ramaphosa had committed to fast tracking structural reforms.

Business Leadership South Africa welcomed the ratings reprieve by Moody’s saying that country is “correcting some of our own goals” but warned against complacency. 

“The unequivocal message from investors is that South Africa must deal with corruption and fix state-owned enterprises (SOEs). Considerable progress is being made on both fronts,” said BLSA CEO Bonang Mohale who met ratings agencies in London, together with Treasury and labour, earlier in March.

-News24.com