Lockdowns associated with combating the COVID-19 pandemic plunged South Africa into its sharpest quarterly economic contraction in second-quarter 2020, leading to a large widening of the fiscal deficit and rapidly rising government debt. Nevertheless, indications are the economy began to rebound from third-quarter 2020 and we expect a return to positive annual growth alongside slow fiscal consolidation in 2021-2023. We are affirming our long-term foreign currency rating at 'BB-' and our long-term local currency rating at 'BB'. The outlook on both the foreign- and local-currency ratings is stable. On Nov. 20, 2020, S&P Global Ratings affirmed its 'BB-/B' long- and short-term foreign currency sovereign credit ratings and its 'BB/B' long- and short-term local currency sovereign credit ratings on South Africa.
