Egyptian Finance Minister Mohamed Maait reacted to Fitch’s decision to downgrade Egypt’s credit rating in both local and foreign currencies to ‘B’ with a negative outlook.
He pointed out that this reflects the institution’s view of assessing the external financing needs of the Egyptian economy, taking into account the unfavorable global financial market conditions for all developing countries, the global wave of inflation, rising interest rates and lending, and the cost of financing due to the restrictive policies of central banks around the world, which led to a wave of capital outflows from emerging markets.
The minister added that in the first half of the financial year, the Egyptian economy attracted large foreign investment, as well as financial resources from many international organizations.
Fitch has downgraded Egypt’s rating to ‘B’ from ‘B+’, while changing its outlook to ‘Negative’, indicating that it may cut its rating further in the coming months due to economic problems in the country.
And the credit rating agency said in a statement that external financing risks are increasing in light of high financing needs and tightening external financing conditions, as well as in a statement that “all this is happening against the backdrop of a state of emergency.” uncertainty in the trajectory of exchange rates and a decrease in external liquidity reserves”.
And pointed out that the occurrence of “a further delay in the transition to a policy of flexible exchange rates, will lead to a further deterioration in confidence, and may also lead to a delay in the implementation of the program of the International Monetary Fund.”
Source: RT