31 Jan 2013
(MENAFN) Egypt has lost its long-term foreign and local currency ratings by a notch from Fitch Ratings, citing a weaker economy and political instability and deteriorating foreign reserves, AFP reported.
The ratings agency lowered Egypt’s ratings to B from B+ with a negative outlook.
Fitch said Egypt’s fiscal position has worsened, with spending on subsidies, interest payments and the public-sector wage bill rising and a weak economy eating into revenues.
Fitch added that diminishing foreign exchange reserves have prompted the authorities to tighten capital controls and introduce foreign exchange auctions.
Fitch also said that inflows from some creditors have kept reserves around three months of current account payments cover. However, without the IMF loan, depreciation would continue drying reserves, leading to higher inflation in an import-dependent economy and to lifting the subsidy bill.
Fitch also indicated to the ongoing political turmoil for nearly two years, which caused economic growth to deteriorate.
Fitch expected Egypt’s real GDP to grow an average of 3.3 percent this year and the next, which is far from the necessary to generate sufficient job opportunities for the 700,000 new entrants to the labour force each year.
The ratings agency warned of another downgrade if there is any delay to an IMF programme beyond the second quarter of this year, or if there is an abrupt depletion of reserves and a disorderly devaluation of the currency.
27 Jan 2025
BBK offers customers with exclusive Tas’heel and Mazaya Finance to own their dream home
15 Jan 2025
BBK Signs Strategic Partnership with Bahrain Airport Company to Develop “Express Cargo Village”
08 Jan 2025
Bank of Bahrain and Kuwait and Global Payment Services Deliver the First Advanced Fraud Prevention Solution for Wallet Provisioning in the Kingdom of Bahrain
26 Dec 2024
BBK proudly supports “Celebrate Bahrain” as a gold sponsor in cooperation with BTEA
17 Nov 2024
BBK and Asia Jewellers announce exclusive offers to its customers at Jewellery Arabia 2024
12 Nov 2024
BBK partners with Durrat Al Bahrain to offer exclusive financing for Jawhart Al Marjan
This website uses cookies to ensure you get the best experience and by clicking “I Accept” below, you consent to the use of cookies. Learn more