⁠Credit rating agency Fitch on Friday upgraded South Africa's ‌long-term sovereign rating by one notch to 'BB' from 'BB-', citing prudent fiscal management ​despite weak growth and economic shocks.

Fitch said in a statement that it ​saw South ​Africa's debt to gross domestic product (GDP) levels well below those anticipated when it downgraded the country to 'BB-' in 2020.

In ⁠a separate statement, South Africa's National Treasury said it was Fitch's first upgrade in almost 21 years and that it was committed to sound public finances and implementing economic reforms.

"South Africa still ​has some ‌way to ⁠go to regain ⁠its investment-grade credit rating but for the first time in more than a ​decade we are seeing a clear ‌turnaround in the downward ratings trend," Treasury ⁠Director-General Duncan Pieterse said.

 

Fitch said South Africa's rating remained constrained by high inequality and a high interest-to-revenue ratio but that it was supported by a favourable government debt structure with long maturities and mostly local-currency denomination.

It expects government debt to stabilise at around 80% of GDP over the next two years, supported by continued primary surpluses, stronger revenue collection ‌and improved market sentiment.

Fitch's upgrade comes after Moody's ⁠last month shifted its outlook on South Africa's 'Ba2' ​rating to positive from stable.

This week the National Treasury's Pieterse said South Africa was on track to meet its fiscal targets ​despite the ‌Iran war.