Angelika Goliger|Published 22 minutes ago

For the past decade, South Africa has felt like a country stuck in slow motion: growth barely above population growth, load-shedding as a national pastime, and investors treating us like the problem child of emerging markets. 

 That narrative is now cracking — and 2025 is the year the crack becomes a breakthrough.

 Think of it as the moment the crow in Aesop’s fable finally feels the water touch its beak. After years of dropping stone after painful stone — unglamorous, unpopular, grinding reforms — the level is rising fast enough for everyone to see. And when markets see momentum, they don’t walk. They sprint.

 The evidence is no longer scattered or incremental; it is converging into a single, powerful signal: South Africa is becoming investable again.

 Start with the headline that made global desks sit up straight last Friday: S&P Global Ratings delivered South Africa’s first credit upgrade in 19 years — BB- to BB on foreign currency, BB to BB+ on local currency. 

 This is not charity. It is cold, hard recognition that the third consecutive primary budget surplus is real, that Eskom just posted its first profit in eight years, and that gross government debt will peak this fiscal year at 77.9% of GDP before starting to fall. Bond yields have already tumbled and the rand punched through R17 to the dollar for the first time since early 2024. Lower borrowing costs are rocket fuel for every listed company with debt on its balance sheet and every municipality trying to fix pipes.

Layer on the FATF grey-list exit — achieved ahead of schedule — and suddenly transaction costs are dropping, correspondent banking relationships are being restored, and foreign investors no longer have to fill in 47-page questionnaires just to send money here. For South African banks and exporters, it is the equivalent of removing a 100-basis-point tax on doing business.

 Then look at the real economy stones that Operation Vulindlela has been quietly dropping. 

Over 12 000 MW of private power projects are now in flight — enough to end load-shedding for good within 24 months. Freight rail is opening to third-party operators (98 applications already in the door). Spectrum auctions have slashed data costs and lit up 5G investment. The Digital Transformation Roadmap is signed, sealed, and funded. These are not PowerPoint dreams; they are regulatory changes that directly translate into trucks moving again, factories running 24/7, and small businesses onboarding customers in seconds instead of days.

 The October Medium-Term Budget Policy Statement sealed the deal with markets. 

 Deficits are shrinking faster than forecast, infrastructure spending is rising 7.5% a year for three years, and a R15 billion guarantee facility is explicitly designed to crowd in private capital. Investors heard one word loud and clear: predictability.

 This is why 2025 is the inflection point.

– Corporate South Africa finally has the confidence to commit capex again. The RMB/BER Business Confidence Index has already jumped to levels not seen since 2018.

– Foreign direct investment pipelines that were frozen in “wait-and-see” mode are thawing. Ask any JSE-listed industrial or logistics CEO right now and they will tell you the same thing: the phone is ringing again.

– The JSE itself, long the world’s most undervalued major equity market, is suddenly trading at forward earnings multiples that no longer bake in disaster risk. A re-rating is coming — and it will be vicious to the upside when global funds finally rotate back into one of the cheapest high-quality emerging market on earth.

 Make no mistake: we are not out of the woods. 

 Politics can still throw sand in the gears, global growth could falter, and execution speed remains the perennial Achilles heel. But for the first time in a generation, the structural trend arrows are all pointing the same way — up.

 South Africa is no longer asking the world for patience. We are giving the world a reason to move allocations, and fast.

 2025 is not just another year of “better than expected”. It is the year the stones we have been dropping finally lift the water high enough for every business, every entrepreneur, and every investor to drink.

 The turning point is here. The only question left is who is bold enough to lean in before the rest of the world piles in behind them.

Angelika Goliger, EY’s Chief Africa economist

*** The views expressed here do not necessarily represent those of Independent Media or IOL

BUSINESS REPORT