African Ratings Reach Highest Since 2020 on Growth, S&P Says
Reforms, falling inflation, and stronger growth have lifted the continent’s sovereign credit profile to a five-year high — but debt pressures and pockets of instability remain.
African sovereign credit ratings have climbed to their highest level since late 2020, according to S&P Global Ratings, with the continent’s average rating now carrying a slightly positive outlook bias. The milestone, published in early February 2026, reflects what S&P describes as a sustained period of economic reform and growth stabilisation that took root in 2024 and consolidated through 2025.
The turnaround has been broad-based. Egypt, Ghana, Kenya, Morocco, South Africa, Togo, and Zambia were all among the countries to receive positive ratings adjustments. Nigeria, Uganda, Cape Verde, and the Democratic Republic of the Congo were also flagged with positive outlooks. The drivers, according to S&P director and senior analyst Ravi Bhatia, include fiscal belt-tightening, improved growth trajectories, and eased financing conditions across multiple economies.
“We expect broad stability and continued positive momentum.” — Ravi Bhatia, S&P Global Ratings
South Africa’s upgrade was among the most closely watched. In November 2025, S&P raised the country’s foreign currency long-term sovereign rating to BB — two notches below investment grade — and its local currency rating to BB+, just one notch below investment grade. It was the first S&P upgrade for South Africa since 2005. The agency cited improving growth and fiscal performance, a third consecutive year of primary surplus, and the ongoing turnaround at state power utility Eskom as key factors. A positive outlook was retained, signalling that further upgrades remain possible.
Ghana’s story was equally striking. After a painful debt restructuring in recent years, the country has benefited from soaring gold prices and tighter fiscal management, transforming one of the continent’s most high-profile debt crises into a credible recovery narrative. Kenya and Egypt, both of which faced acute foreign currency pressures in 2023 and 2024, also received upgrades as their external positions stabilised and reform programmes gained traction.
Not every country shared in the improvement. Senegal was downgraded after a fiscal audit revealed a debt stock significantly larger than previously disclosed — a reminder that transparency remains an uneven feature of African sovereign finance. Botswana, long one of the continent’s most stable credits, was also cut, as collapsing diamond prices weighed on government revenues. Negative outlooks in Madagascar and Mozambique point to ongoing political and economic fragilities.
The broader picture also carries a significant caution. African governments are projected to face external debt repayments exceeding $90 billion in 2026, raising concerns about external vulnerability at a time when global financing conditions remain uncertain. High public debt loads — South Africa’s gross government debt is expected to reach 79% of GDP in 2025 before gradually declining — mean that the current positive momentum must be carefully managed.
S&P’s overall read, however, is one of cautious optimism. After years defined by pandemic shocks, war-driven inflation, and currency crises, Africa’s sovereign credit landscape is quietly shifting. For investors who have long been wary of the continent’s risk profile, the direction of travel — for now — is encouraging.
