29 May 2022
Moody’s Investors Service, one of the leading global credit rating agencies, has affirmed Egypt’s long-term foreign- and local-currency credit rating at B2. This vote of confidence comes despite the negative economic shocks witnessed by the global economy, and emerging economies in particular. According to Moody’s, the rating affirmation is based on the success of Egypt’s fiscal and economic reforms over the past years, as well as its pro-active crisis policy response. Tighter global financing conditions can be countered by Egypt’s diverse, reliable sources of funding. As for economic performance, Egypt’s impressive GDP growth, even during global economic turmoil, gives confidence to prospective foreign investors while giving Egypt the resilience to maneuver around a changing global economic landscape.
On the other hand, Moody’s also downgraded Egypt’s outlook from ‘stable’ to ‘negative’, but is awaiting improvements in the economic and financial situation to restore their outlook back to ‘stable’. The current tightening in global financing conditions risks diminishing recurrent inflows despite considerable financial commitments from Arab Gulf countries such as Saudi Arabia. On top of that are food import issues faced by Egypt due to the Russia-Ukraine conflict and its negative effects on global food supplies, especially wheat, which is a key Egyptian staple.
(Sources: Moody’s (English), State Information Service (English), Ministry of Finance, Zawya (English) (Arabic), al-Ahram (English) (Arabic), Egypt Today (English), Sada el-Balad (English), Xinhua (English), Amwal al-Ghad, Hapi Journal, al-Youm al-Saabe, al-Masry al-Youm, al-Watan, Akhbar al-Youm, Masrawy, al-Sharq Business, CNBC Arabia, al-Arabiya, RT)