This report supplements our research update "South Africa Foreign Currency Ratings Affirmed At 'BBB/A-2'; LC Ratings Affirmed; Outlook Remains Negative," published on Dec. 20, 2013. To provide the most current information, we may cite more recent data than that stated in the previous publication. These differences have been determined not to be sufficiently significant to affect the rating and our main conclusions. The ratings are supported by our view that the administration under President Jacob Zuma is ensuring broad and largely pragmatic policy continuity, and that South Africa has strong institutions and deep financial markets. The ratings are constrained by sizable current account deficits, the funding of which heavily depends upon potentially volatile portfolio flows. This could expose the economy
