South Africa Poised for Further Credit Upgrades on Revenue Surge

South Africa's strong revenue performance has put the country on course for further credit-ratings upgrades, according to Goldman Sachs Group Inc.

The firm noted that corporate tax collections grew by about 5.5% to R385-billion on a semi-annualised basis in June, exceeding both the previous year and the projected figure for the current fiscal year.

Goldman Sachs economist Andrew Matheny stated that this continued strength in fiscal data reinforces their expectation of credit rating upgrades from Moody's and S&P Global Ratings over the next year.

Moodys currently pegs South Africa at Ba2, while S&P Global Ratings upgraded its rating to BB+ in November last year. A further increase would lift the country's rating even higher and support South African fixed-income instruments.