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South Africa will be unable to shed its "junk" credit rating for years to come, credit analysts said, despite investor optimism over the economic trajectory since the formation of a coalition government this year.

S&P Global is scheduled to review the sovereign rating of Africa's most industrialised economy on Friday, though the agency has its long-term foreign currency rating three notches into sub-investment grade at 'BB-', with a stable outlook.

Eight months of uninterrupted power supply after years of blackouts and the promise of faster economic reform under the coalition has boosted business confidence. But fiscal risks remain and it will be a while before economists can gauge the new government's success at accelerating growth.

"That discussion around investment grade is still a very distant one. We're still very far from that," Tatonga Rusike, Sub-Saharan Africa economist at Bank of America Securities, said in an interview.

For S&P or the other two big agencies, Moody's and Fitch, to move to a positive outlook - a sign that an upgrade may follow soon - would require evidence of much faster growth and progress stabilising public debt, analysts said.

Fitch also has South Africa's long-term foreign rating three notches into sub-investment grade at 'BB-', with a stable outlook. It has completed its 2024 reviews and last week raised doubts over the government's ability to meet some of the targets it set in October's mid-term budget.

Moody's has South Africa two notches into sub-investment grade at 'Ba2', with a stable outlook.

"There are still big risks, at the same time, to the outlook for public finances," said Miyelani Maluleke, head of South Africa macroeconomics research at local bank Absa.

South Africa's growth forecasts still lag behind those for many emerging market peers, with the government expecting growth of just 1.1% this year.

Analysts said sustained economic growth of around 2% and evidence that debt was stabilising could prompt a move to a positive outlook in the first half of 2025.

Debt as a share of gross domestic product jumped from 23.6% in 2009 to 74.1% this year, and the government said last month that it aimed for it to peak at 75.5% in 2026.

"They (the ratings agencies) want to see evidence that the changes are actually delivered in terms of improved economic performance," Absa's Maluleke said.

Home Affairs Minister Leon Schreiber noted on Wednesday that the digital transformation of the border environment is an important priority for the Government of National Unity (GNU) to be able to grow the economy and create jobs.

Schreiber was speaking during the inaugural Border Management Conference, where he said the Border Management Authority (BMA) was set to play a fundamental role in the digital transformation of the entire Home Affairs environment.

He said a deliberate focus on building a strong organisational culture, unlocking the benefits of partnership, and embracing technology, held the key to turning the BMA's vision of building an integrated border law enforcement authority into reality.

His department's vision for digital transformation meant it had to digitalise the immigration process.

"Given the capacity and human resources constraints facing the authority, there can be no more powerful force multiplier than investing in technology. For example, a single modern drone used by the BMA for surveillance of the border line will be able to effectively detect illegal crossings in a context where the authority lacks the manpower it needs for surveillance," Schreiber pointed out.

Body cameras can similarly majorly impact ongoing efforts to combat corruption, he added.

"Importantly, as I have also repeatedly emphasised to the BMA management, all of this data will only be effective if it is integrated and analysed on an ongoing basis in order to guide decision-making," he stressed.

In highlighting BMA achievements, he noted that over the last two quarters, the BMA apprehended over 36 000 "undocumented, undesirable and inadmissible persons".

It seized 249 fraudulent documents, confiscated counterfeit cigarettes worth over R22-million, counterfeit clothing worth over R4-million, more than 1 100 stolen vehicle parts, and drugs with a street value of over R6-million.

"Over the same period, the BMA screened over two-million people, searched more than 108 000 trucks, processed over 12 000 flights and conducted 648 roadblocks around ports of entry," he added.

It was crucial to leverage the strength of partnerships and cooperation, Schreiber said, as he revealed that the BMA had only 2 700 out of the 11 000 officials it required.

However, the BMA was committed to fostering partnerships with the private sector to leverage cutting-edge technology, streamline trade processes, and optimise operational efficiency, he said.

"By working with logistics companies, for instance, we can more effectively monitor the movement of goods and manage the flow of trade, which helps reduce congestion and improves service delivery," Schreiber said.

He stated that collaboration with security firms would also enhance surveillance, increase the monitor of high-risk areas, and ensure quicker response to incidents.

Technology firms were also key players in this effort, to help integrate digital solutions that made border processing faster and more secure, he said.

"By creating public-private partnerships, we will encourage the development of a border management framework that serves both public interests and private sector growth," Schreiber stated.

South African Football Association (SAFA) President Danny Jordaan was arrested on Wednesday over allegations he used the organisation's money for his own purposes.

Jordaan, a leading figure in bringing the 2010 World Cup to South Africa, had tried to get a court to halt his imminent arrest on Tuesday. The case has been adjourned to December 5.

Jordaan, who was granted bail for R20 000, denies any wrongdoing.

The arrest stems from a raid by police on the SAFA offices in March. A police spokesperson said at the time the allegations were that between 2014 and 2018 "the president of SAFA used the organisation's resources for his personal gain, including hiring a private security company for his personal protection and a public relations company, without authorisation from the SAFA board".

Jordaan, 73, and his co-accused, SAFA chief financial officer Gronie Hluyo and businessman Trevor Neethling who were also granted bail, appeared in the Palm Ridge magistrates court.

They have been warned against any contact with the list of 19 potential state witnesses who could testify against them.

Neither Jordaan nor the SAFA responded to a request for comment from Reuters.

Following the tragic deaths of children and several hospitalisations in Gauteng, Mpumalanga, Eastern Cape, KwaZulu-Natal and Free State, President Cyril Ramaphosa will address the nation on the interventions government is undertaking to deal with food poisoning.

The Department of Health has activated the National Institute of Communicable Diseases to trace and examine the source of the poisoning of foodstuffs and make recommendations.

The Department of Co-operative Governance and Traditional Affairs supported by the Department of Small Business Development and the Inter-Ministerial Committee on Disaster Management have gazetted the Standard Draft By-laws for Township Economies aimed at mobilising municipalities around a common agenda and collective responses towards inclusive local economies and curbing illegal business operations in townships.

LOCAL GOVT ELECTIONS

Meanwhile, cabinet announced that it has approved the establishment of an Inter-Ministerial Committee (IMC) that will oversee preparations for the 2026/27 Local Government Elections.

The next municipal elections will be held between November 2, 2026 and February 1, 2027.

"The IMC will be convened by the Minister of Cooperative Governance and Traditional Affairs and consists of several government departments that are key to ensuring the delivery of successful elections," it said.

It added that the IMC will work with the Independent Electoral Commission and other relevant bodies towards ensuring that the process leading to the local government is smooth and peaceful.

Cabinet also considered and approved the formular for the determination of the number of councillors in terms of Section 20 (1) (a) of the Municipal Structures Act.

INTERNATIONAL COURT OF JUSTICE

Cabinet has welcomed the filing of the Memorial to the International Court of Justice, which it said showed how the government of Israel violated the Genocide Convention through deliberate violations and murder of Palestinians living in Gaza.

"The memorial document of more 1 300 pages - supported by exhibits and annexures - contains evidence of Israel's genocidal acts, and its failure to prevent incitement to genocide and punish those inciting and committing acts of genocide," cabinet pointed out.

So far, more than 43 000 lives have been lost in the onslaught on Palestine, following attacks on Israel by Hamas.

Cabinet noted that the filing of the memorial took place at a time when Israel is intensifying the killing of civilians in Gaza and is intent on following a similar path of destruction in Lebanon.

"The memorial is a reminder to the global community of the atrocities perpetuated against the people of Palestine and the need for solidarity to stop the catastrophe. The filing also comes in the footsteps of the United Nations resolution condemning the actions of the Israeli government against the people of Palestine," said Cabinet.

South Africa is marketing eurobonds in its first potential international debt sale under a government of national unity following May elections.

The dollar offering is set to include a benchmark-sized 12-year fixed note with a yield in the 7.4% area, as well as a 30-year bond in the 8.25% area, according to a person familiar with the matter, who asked not to be identified.

The move comes amid uncertainty for global monetary policy, with Donald Trump's US election victory casting a shadow over what would otherwise be a positive reform story unfolding in South Africa. His policies may keep funding costs elevated, complicating the environment for nations like South Africa.

"There is probably a window of opportunity to issue" given the significant outperformance of South Africa's bonds after the formation of the national unity government and emerging-market eurobond spread compression, said Samir Gadio, head of Africa strategy at Standard Chartered Bank. "EM credit markets have been resilient so far after the Trump election win," he said.

South Africa's dollar-denominated bonds were the worst performers in a Bloomberg Sovereign hard-currency index tracking emerging and frontier markets on Tuesday. Yields on the nation's eurobond due in April 2052 jumped by 12 basis points to 7.83%. That's still below levels as high as 9% before the elections.

"We are very happy to see South Africa back after 30 months," said Søren Mørch, head of emerging-market debt at Danske Bank. "We are a bit positive on the reform agenda after the election, and we think the government deserves the benefit of the doubt."

"Timing is decent - the spread has narrowed significantly," Mørch said. The South African Treasury remains a part of the country's strong institutions, he added.

Citigroup Inc. and Goldman Sachs Group Inc. are acting as bookrunners for the sale, which is expected to price later on Tuesday.

South Africa's rand hit a three-month low on Tuesday, hurt by a stronger dollar and weaker gold prices, as markets grappled with what another Donald Trump presidency will mean for US policy and trade relations.

At 15:51 SAST, the rand traded at 18.04 against the dollar, after earlier touching its weakest level since mid-August.

The risk-sensitive rand has been highly volatile since Trump's US election win last week and is on course for its third day of heavy losses.

Investors have piled into trades seen as benefiting from the incoming US administration, with markets anticipating Trump's policies could mean higher economic growth in the short term but also potentially inflationary pressures.

Potential policy changes include tariffs and tax cuts.

ETM Analytics said in a research note that the rand "remains on the defensive while investors try to understand what (Trump's win) means for the dollar and for currencies quoted against it".

The rand reacted little to positive local job data on Tuesday showing the unemployment rate fell for the first time in a year in the third quarter.

The unemployment rate fell to 32.1% from 33.5% in the second quarter.

Next up among potential local drivers is September manufacturing output data at 1100 GMT. Economists polled by Reuters are predicting a 0.9% year-on-year expansion after August's 1.2% decline.

On the Johannesburg stock market, the Top-40 index was down about 0.9%.

The benchmark 2030 government bond was weaker, the yield up 3.5 basis points to 9.26%.

Political parties on Wednesday welcomed the decrease in the unemployment rate, however they slammed the Government of National Unity (GNU) for failing to grow the economy.

Statistics South Africa (Stats SA) reported that South Africa's unemployment rate decreased by 1.4 percentage points to 32.1% in the third quarter, from 33.5% in the second quarter.

The expanded unemployment rate, which includes discouraged work seekers, decreased by 0.7 of a percentage point to 41.9%, compared with 42.6% in the second quarter.

The Economic Freedom Fighters (EFF) said the decrease in unemployment is deceptive and does not signify real economic growth or improvement in the quality of employment opportunities.

"A closer examination reveals that these employment changes are largely driven by precarious and informal sector jobs, as well as part-time government employment schemes, rather than sustainable, full-time positions in the formal private sector," the party said.

The EFF also pointed to the increase of 294 000 employed persons - bringing the total employed to 16.9-million - which is said is insignificant in the context of the country's persistent economic stagnation.

"This modest rise fails to address the fundamental economic challenges faced by millions of South Africans, especially Black African women and young people, who continue to bear the brunt of government failures and systemic inequality," the party said.

The EFF alleged that after the first 100 days of the Democratic Alliance-African National Congress (DA-ANC) coalition there are still no changes to the country's economy and no significant growth in employment.

The party accused the GNU of ingratiating white capital, and of being unconcerned with the needs of ordinary South Africans.

GOOD Secretary-General Brett Herron noted that although any improvement in the unemployment rate should be celebrated, the reality is this number remains stubbornly high.

"Eight-million South Africans are unemployed, with no income to support their families. In terms of the expanded definition, which includes the people who have given up looking for jobs, unemployment decreased by 0.7% points but still sits at a socially unsustainable 12.2-million people," said Herron.

He highlighted that unemployment rate among the Black Africans remains higher than the national average with Black African women continuing to be the most vulnerable.

He stated that South Africa is stuck in an economic growth crisis, trapping millions of South Africans in unemployment and unacceptable levels of poverty, more especially young and black South Africans.

"…we simply have no choice but to implement a Basic Income Grant. As we have highlighted before, unless the country can achieve a sustained economic growth rate of 5% to 6% per annum, South Africa will not be able to meaningfully reduce unemployment," he said.

ActionSA Member of Parliament Alan Beesley said more bold measures are needed to lift South Africa out of its unemployment crisis.

Beesley highlighted that the unemployment numbers, while showing a slight improvement compared with the previous quarter, still paint a picture of an enormous employment crisis.

He said South Africa's economy is simply not growing and as such is unable to create jobs.

"National Treasury has forecasted a growth rate of 1.1% for 2024, following only 0.4% growth in the first half of the year, with an average projection of 1.8% over the next three years. In contrast, emerging markets and developing countries are growing at 4.2% on average, while Sub-Saharan Africa is expected to grow at 3.6%. South Africa is lagging its peers and even many developed countries. Given our population growth rate of 1.3%, this sluggish economic growth means that unemployment is likely to get worse," he explained.

POSITIVE OUTCOME

Meanwhile, the ANC celebrated what it termed a "positive employment outcome", saying the Quarterly Labour Force Survey demonstrated significant strides in job creation and economic ...

The Public Servants Association (PSA) on Monday called for proper regulations and for the appointment of health inspectors to monitor the compliance of spaza shops.

The association urged Cooperative Governance and Traditional Affairs Minister Velenkosini Hlabisa to prioritise the matter, while calling for the intensification of monitoring to prevent further loss of lives.

The PSA said reported cases must be subjected to investigation and where deliberate foul pay is proven, culprits needed to face the full extent of the law.

The association welcomed the recent announcement by President Cyril Ramaphosa regarding the approval of the proclamation to regulate spaza shops across South Africa, noting that this was a significant step in ongoing efforts to enhance the safety, quality, and sustainability of these community businesses.

The PSA said this intervention came at a critical time when South Africa was witnessing an unprecedented spike in food poisoning reports, with 14 fatalities and hundreds of children falling ill.

The association described the situation as a "ticking time bomb" considering the outcry in communities over expired or fake products being sold by spaza shops had been years in the making without adequate government response.

"Whilst spaza shops play an essential role in communities, providing convenient access to goods and services, the non-regulation of these establishments created fertile ground for quick profit at the expense of citizens," it said.

The PSA said while Ramaphosa attributed the current situation to the "recklessness" of spaza shops as well as "lack of health and safety" measures by these shops, the association felt that he unjustifiably omitted pointing a finger at government for its role in the crisis.

Parliamentary Communications and Digital Technologies Committee chairperson Khusela Diko expressed concern at Communications Minister Solly Malatsi's decision to withdraw the South African Broadcasting Corporation (SABC) Bill from Parliament, saying this will delay the implementation of crucial reforms necessary to save the broadcaster.

In withdrawing the Bill, Malatsi argued that it was "totally flawed" and did not address the faltering funding model of the public broadcaster.

It also assigned too much power to the Minister in appointing board members, he said.

However, Diko believes Malatsi's decision is "highly ill-advised, and would be the end of the broadcaster".

She pointed to the SABC's challenges, which she said required a considered and urgent response, "not trigger-happy action", which she said served no purpose but to frustrate and disrupt processes already underway.

Diko urged the communications department to accelerate the process of reworking the Bill and reintroduce a new version to Parliament within the current financial year.

In the meantime, the committee will call on Malatsi to indicate how, in the interim, the financial situation at the public broadcaster can be improved to ensure sustainability until the legislation is amended.

"Failure to reintroduce the Bill timeously will leave individual members of the committee or the committee itself with no option but to entertain introducing a committee or Private Members' Bill in the best interest of the SABC for consideration by Parliament," Diko said.

She highlighted that to date, the Bill had undergone a thorough public participation process, with the sixth Parliament having received about 20 written submissions and the seventh Parliament prioritising the legislation and holding oral hearings into the submissions in September 2024.

Diko said she strongly believed that an attempt to withdraw the Bill from Parliament would "delay and derail the transformative and developmental interventions the government has been pursuing in State institutions".

She pointed out that the committee had been at pains to put in place a fast-tracked process to finalise the SABC Bill, "the absence of which has created a serious legislative vacuum that has dire consequences. To this end, the government and even the committee itself have initiated various engagements with stakeholders on the possible funding model for the public mandate of the SABC - the most substantive and urgent of the concerns raised against the Bill."

Diko urged Malatsi to prioritise the finalisation of the White Paper before stopping a process underway, as this had a bearing on the amendment of the Bill.

She said the public broadcaster could not be allowed to fail because its demise would spell unmitigated disaster also for State-owned provider of electronic communications network services SENTECH.

Meanwhile, the Democratic Alliance commended Malatsi for relinquishing executive powers that would have extended overreach into the SABC.

DA spokesperson on communications and digital technologies Tsholofelo Bodlani said the Bill was "significantly counterproductive."

The long-term historical ally of the African National Congress, the South African Communist Party (SACP), says it never initiated any engagement with the uMkhonto weSizwe Party (MKP), neither has it received any request for a formal engagement.

The party was responding to a news article, which claimed that the MKP was negotiating behind the scenes to solidify an alliance with the SACP with the explicit objective of jointly challenging President Cyril Ramaphosa's Government of National Unity.

The SACP pointed out that the story was based on what the MKP was apparently plotting, but added that it incorrectly referred to a recent interview by Sunday World Engage with the SACP general secretary Solly Mapaila, where he stated: "I never close the possibility to engage with forces opposed to capital in this country, irrespective of their orientation".