S&P Affirms Egypt's Rating at B/B with a Stable Outlook

S&P Global Ratings affirmed Egypt's credit rating in foreign and local currencies at B/B with a stable outlook, attributing its decision to exchange rate flexibility, improved foreign inflows, and continued fiscal consolidation, according to a report by Business Today Egypt.

The agency balanced these factors against the risks of regional conflict, noting that sustained tensions could pressure vital sectors such as tourism, the Suez Canal, and workers' remittances, making the rating vulnerable to any regional escalation in the coming period.

The agency stated that Egypt achieved a primary surplus equivalent to 4.9% of GDP in the 2025/26 fiscal year, exceeding the targets of the International Monetary Fund (IMF) program, which serves as an indicator of improved public finance management and the state's ability to control spending.

This decision is relevant to investors and borrowers in Egypt, as the credit rating determines the cost of borrowing from global markets and the attractiveness of Egyptian debt instruments. S&P's affirmation comes days after a similar decision by Fitch Ratings to affirm Egypt's rating at B, reinforcing a picture of gradual stability among rating agencies.

What do these terms mean?

Credit Rating: An assessment issued by a specialized agency on the ability of a country or company to repay its debt on time; the higher the rating, the lower the borrowing cost.

Outlook: The agency's forecast for the direction of the rating in the coming period, which can be stable, negative, or positive. A stable outlook suggests the rating is likely to remain unchanged.

Primary Surplus: The difference between government revenue and expenditure excluding debt interest payments, used to measure a state's ability to manage its public finances.

IMF Program: A financing agreement with the Fund in which each disbursement is linked to the implementation of agreed reform measures, monitored through periodic reviews.