S&P affirms Egypt's ‘B-/B’ rating, revises outlook to stable amid reform progress
Updated 4/12/2025 10:17:00 AM
Arab Finance: S&P Global Ratings has revised its outlook on Egypt to stable from positive, while affirming the country’s long- and short-term sovereign credit ratings at ‘B-/B’ for both foreign and local currency debt, as per a statement.
The agency said the stable outlook reflects a balance between Egypt’s commitment to fiscal and structural reforms and its exposure to risks from a slowdown in global growth and potentially volatile external financing conditions.
S&P noted that it could consider an upgrade if Egypt’s net government or external debt positions improve faster than expected, driven by stronger foreign direct investment, state asset sales, and robust economic growth, which could also ease the country’s interest burden.
However, the agency warned that it could revise the outlook to negative if the government’s commitment to macroeconomic reforms weakens, particularly with regard to exchange rate flexibility, or if imbalances such as foreign currency shortages resurface.
A downgrade could also be triggered by a distressed debt exchange or increased difficulty accessing external markets amid rising geopolitical tensions and higher tariffs.
S&P expects Egypt to remain largely aligned with its commitments under the International Monetary Fund (IMF) program, unless inflationary or social pressures force policy reversals.
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