IMF deal credit positive for Egypt, implementation risks remain high

The International credit rating agency Fitch said on Monday that for Egypt securing an IMF funding deal would be credit positive for the country's economy, yet warned that risks in implementation are high and the country will continue to face several economic challenges.
On Saturday, an IMF delegation started its two-week visit to Egypt as the Egyptian government eyes a $12 billion loan package.

The programme, through which Egypt is seeking to secure $4 billion annually over three years, is aimed at easing the country's budget deficit, which edged up to between 11 and 13 percent over the past six years.

An agreement could be in place by September if discussions are finalised.

Fitch said it is currently giving Egypt a 'B' rating with a stable outlook.

"In our opinion, this could still fall short of Egypt's total financing needs, which we estimate could be closer to $10 billion annually, but a package would also likely stimulate some return of portfolio investment inflows," Fitch said in an official statement.