Egypt – Ratings Lowered; Outlook Revised to Stable

Ref: EG23CRA00-02 1 September 2023

Egypt – Ratings Lowered; Outlook Revised to Stable

Rating Action

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has lowered Egypt’s Long-Term Foreign Currency Rating (LT FCR) and Long-Term Local Currency Rating (LT LCR) to ‘B’ from ‘B+’. The Outlook on Egypt’s LT FCR and LT LCR has been revised to Stable from Negative. At the same time, CI Ratings has affirmed the sovereign’s ST FCR and ST LCR at ‘B’.

Rating Rationale

The downgrade reflects the increase in Egypt’s external financing risks due to the country’s high external financing needs and risks to the sufficiency and timeliness of financing inflows . This uncertainty is a result of the reform-dependent nature of much of the external funding targeted by the authorities, as well as more challenging and costly capital market access.

In CI’s opinion, the pace of reform implementation has been…