Recent unrest in South Africa is likely to shave about 0.7% off headline GDP growth in 2021 but strong commodity prices will continue to support the economy, S&P Global ratings said.

Protests in support of former president Jacob Zuma broke out this month when he handed himself over to authorities to start a 15-month jail term for contempt of court, and escalated into riots that killed more than 300 people and caused extensive damage to businesses and infrastructure. 

“It is estimated that the unrest will likely shave about 0.7% off headline GDP growth in 2021, hit private consumption, and slow the pace of economic recovery,” S&P said in a report dated July 26.

“If the unrest were to recur and last for a long time, this would further pressure the economy and potentially stifle the rebound.”

S&P forecast that South Africa’s economy will expand by 4.2% in 2021, which is more than the Treasury’s February estimate of 3.3% growth.

The ratings agency said it did not expect an immediate rating action, but if the unrest was repeated or prolonged, it could pose risks to ratings.

In May, S&P affirmed South Africa’s long-term foreign-currency rating of BB-, or three notches below the investment grade. It kept the country’s local currency debt at BB, both with a stable outlook.