Fitch Revises Egypt's Outlook to Positive

On Friday, credit rating agency Fitch revised its outlook for Egypt from stable to positive. The agency affirmed Egypt's rating at "-B", noting a decrease in external financing risks and strong foreign direct investment. The International Monetary Fund (IMF) had approved an extended financial support package for Egypt worth eight billion dollars, and an IMF official indicated last month that "the Fund's loan program with Egypt would help the country gradually reduce its debt burden." In February, Egypt secured a 35 billion dollar real estate investment from the UAE for the development of the Ras al-Hikma project on the Mediterranean coast. Fitch pointed out that "initial steps to contain off-budget spending could help mitigate the risks to public debt sustainability." Fitch stated in a press release: "Exchange rate flexibility will be more sustainable than in the past, which partly reflects its close monitoring under the extended Fund facility agreement between Egypt and the Fund that runs until late 2026." Additionally, Moody's rating agency revised its outlook for Egypt to "positive" in early March but maintained its rating unchanged due to the high level of government debt and weak debt affordability compared to its peers.