South Africa will need to expedite reforms that can boost economic growth to sustain investor inflows that have flooded in since the formation of a coalition government, according to the world’s largest investment banks.

Since the African National Congress aligned with business-friendly parties after losing its outright majority in May 29 elections, South African markets have been on a tear. The rand has gained 5% to the dollar, local-currency bonds have outpaced all peers in an emerging-market index with returns of 24% in greenback terms, and the Johannesburg Stock Exchange has hit successive record highs, delivering a 15.7% return in dollar terms.

Deputy President Paul Mashatile and a delegation of ministers are in London this week to secure fresh capital from the likes of JPMorgan Chase & Co. and Goldman Sachs Group.

Investors will continue to look favourably on Africa’s most industrialised economy if it can improve the generation capacity at its State-owned power utility and fix its fraying port and rail operator, JPMorgan strategist David Aserkoff said at an event at the London Stock Exchange on Tuesday.

“South Africa really needs to rehabilitate Eskom Holdings SOC Ltd. and bring Transnet SOC Ltd. back on track,” said Aserkoff. The nation needs two years of 2% gross domestic product growth, “and then we’re going to see South Africa outperform. Then we’ll see South Africa deliver the kinds of results we know that it can. And I think 2025 is going to be the first of those two years.”

South Africa’s local yield curve and the rand are “undemanding,” said Andrew Matheny, an economist at Goldman Sachs. He expects the nation could realise more value from these assets fast-tracking reforms and accelerating economic growth.

Doing so could also improve South Africa’s sub-investment-grade credit ratings within six months and help with fiscal strains that worry investors, Matheny said.

Over “the last four years, you’ve seen the wage bill cut pretty significantly — it’s been declining as a share of GDP,” said Matheny. “Spending cuts on the social side have been across the board but we’re reaching the point where they are really harming service delivery. There are some speed limits that probably need to be put in place on that now.”

South African Finance Minister Enoch Godongwana will deliver the nation’s first medium-term-budget policy statement on October 30 since the coalition government was formed. The policy priories and updated fiscal metrics will be closely watched by investors.