SA enters the close of 2025 with an economic narrative fundamentally different from the one investors had grown accustomed to over the past decade. For the first time in many years the shift in sentiment is underpinned not by hope or political messaging, but by measurable improvements in the country’s operational and macroeconomic environment.
The defining feature of 2025 has been stability. In markets, stability is an asset class in its own right and this year SA finally delivered it. The dramatic reduction in load-shedding has been central to this turnaround. When the country’s energy supply becomes predictable productivity lifts, inflation expectations ease and foreign and local investors begin to price in a future that is not perpetually constrained by operational uncertainty.
The reforms across logistics, ports and rail — long recognised as critical bottlenecks to growth — have moved from policy documents to implementation. Efficiency gains in these areas feed directly into lower risk, higher throughput and a more competitive export environment. For market participants these are not abstract concepts; they are hard economic inputs that recalibrate investment models, pricing and long-term expectations.
A pragmatic alignment between government, business and global institutions has supported this progress. The public-private partnerships that took shape in 2025 have been operational rather than ideological, with private capital stepping into energy, infrastructure, security and logistics in ways that relieve pressure on the state and accelerate reform outcomes.
Energy stabilisation remains the anchor. As private generation integrates more fully with a recovering Eskom, and as regulatory clarity improves, the economy is beginning to operate with a level of consistency not seen in years. The result is a more resilient rand, a firmer inflation outlook and healthier fiscal metrics.
Bullish on SA
These domestic improvements have not gone unnoticed abroad. During our recent investor trip — spanning meetings at the IMF in Washington, major funds in New York and leading asset managers in London — one message dominated: global investors are increasingly bullish on SA. Not cautiously optimistic. Not selectively positive. Genuinely bullish.
For the first time in many years global trading desks are not asking how much downside risk to price in, but rather how much upside SA still has to unlock. That shift alone is powerful.
The reasons they cited mirror the developments we have witnessed at home: meaningful reforms, clearer policy direction, energy stability and the emerging credibility of the government of national unity’s macroeconomic framework. Many highlighted that SA now offers one of the most attractive risk-adjusted return profiles among emerging markets. Their bullishness is conditional though: it will persist only if macro discipline holds and reforms continue at their current pace.
This wave of positive sentiment was amplified recently when S&P Global Ratings delivered SA’s first sovereign credit rating upgrade in nearly two decades, raising the long-term foreign-currency rating from BB minus to BB with a positive outlook. The upgrade cited stronger growth prospects, improved fiscal consolidation and reduced contingent liabilities — particularly reflecting improvements in the energy sector. While SA remains below investment grade, the upgrade is significant: it lowers borrowing costs, broadens the investor base and signals renewed confidence in the country’s reform trajectory.
As we look ahead the opportunity before us is substantial but not automatic. If the progress achieved in 2025 is maintained — and if macro stability continues to anchor policy decision-making — SA is well-positioned for a multi-year cycle of steady expansion. Investment into infrastructure, renewable energy, manufacturing and digital services will accelerate. Job creation will follow. Growth may not be spectacular, but it will be consistent and consistency is ultimately what drives long-term prosperity.
For the first time in many years global trading desks are not asking how much downside risk to price in, but rather how much upside SA still has to unlock. That shift alone is powerful. It signals that the country’s narrative is changing and this time the fundamentals are changing with it.
SA enters 2026 with something far more valuable than optimism: credibility. And in global markets, credibility is the difference between potential and performance.
• The authors are co-CEOs of institutions & co-heads of global markets at Rand Merchant Bank.
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