Standard & Poor’s Global credit rating agency affirmed Egypt’s rating at the “B/B” level for both long-term and short-term credit in foreign and local currencies, while maintaining a stable outlook. The agency also maintained the transferability and external transferability rating at “B”.
The stable outlook reflects a balance between positive expectations for growth in Egypt in the medium term, and strong progress in economic reforms, against the risks resulting from the continuation of regional conflicts for a long period.
The agency stated in a report seen by the “Arabiya Business” website that it may resort to lowering Egypt’s credit rating in the event of a decline in the government’s commitment to implementing comprehensive economic reforms, including maintaining the flexibility of the exchange rate. It also warned that it may take negative action if economic imbalances worsen, such as foreign currency shortages, if higher interest costs increase pressures on public finances, or if current geopolitical tensions affect Egypt’s capacity. On the other hand, the agency indicated that it may raise Egypt’s credit rating if the government and external debt conditions improve at a faster pace than expected, by accelerating the pace of reducing debt or increasing foreign direct investments, with the support of plans to sell state assets.
The agency explained that the credit rating could also be raised if Egypt benefits from policies to diversify the economy and open key sectors to foreign investment, while improving the quality of external financing.
I also mentioned that Egypt began this crisis with stronger foreign reserves compared to previous crises, as a result of the major reforms implemented by the authorities during the past 24 months, which included liberalizing the exchange rate system. These reforms have contributed to obtaining support from the International Monetary Fund and other donors, in addition to attracting large investment flows from the Gulf Cooperation Council countries.
The agency noted that these reforms supported strong growth in tourism revenues, remittances from Egyptians working abroad, and investment portfolio flows, which contributed to a rise in international reserves to $52.8 billion in March 2026.
On the other hand, the agency pointed out that external liquidity conditions were much weaker with the beginning of the Russian-Ukrainian war in February 2022, when reserves reached 41 billion US dollars, and there was no existing program with the International Monetary Fund, in addition to weak exchange rate flexibility, which contributed to the dollar shortage.
The agency warned that the current global shock is likely to put pressure on Egypt’s external balance, especially since Egypt has become a net energy importer since 2023. Fuel and gas imports represent about 22% and 8% of total goods imports, respectively, which negatively affects Egypt’s ability to access foreign markets and increases the cost of debt.
