Egypt's economic reform programme has been praised by one of the big 3 credit-rating agencies.
Fitch Ratings, one of the big 3 credit-rating agencies worldwide, has affirmed Egypt’s Long-Term Foreign-Currency Issuer Default Rating at “B” with a positive outlook, according to Egypt Today.
The ratings go from AAA, which is the highest, to AA, BBB, BB, B, CCC, and finally D, with either a positive, stable, or negative outlook accordingly.
In January, Fitch has revised the Outlook on Egypt's Long-Term Foreign-Currency Issuer Default Rating (IDR) to Positive from Stable and affirmed the IDR at 'B'.
The ratings are based on the progress in executing an economic and fiscal reform programme, greater macroeconomic stability, and improving external finances. The report stated that the positive outlook reflects improving trends across a number of Egypt’s credit metrics in response to the reform program.
Fitch has praised Egypt’s Egypt’s economic reform in line with IMF’s $12-billion loan, which consisted of floating the local currency and losing around 50 percent of its value, more widely imposing taxes (like VAT) and cutting energy subsidies to trim the budget deficit. The report also forecasted average inflation to decline from 13 percent to 11.6 percent between 2018 and 2019.
Also, earlier this year, planning minister Hala el-Saeed announced Egypt’s growth rate for the 2017/2018 fiscal year at 5.3 percent, against 4.2 percent the previous year, hitting its highest level in ten years.
Main image from Expat Cairo.