Egypt’s financial outlook shifts to stable at S&P, ’B-/B’ ratings confirmed

S&P Global Ratings has revised its outlook on Egypt’s economy from positive to stable while affirming its ’B-/B’ sovereign ratings. The change, announced on April 11, 2025, reflects Egypt’s ongoing susceptibility to global financial market challenges, despite significant reforms undertaken since March 2024.

Egypt’s high interest-to-government revenue burdens and external accounts’ vulnerability to global financing conditions have contributed to this revision. The nation’s elevated external and domestic financing requirements make it particularly susceptible to global financial market headwinds.

The stable outlook is a balance between Egypt’s commitment to fiscal and economic reforms and its vulnerability to potentially volatile external financing conditions due to lower global growth. The ratings could be raised if Egypt’s net government or external debt positions improve faster than currently expected, possibly through a combination of higher foreign direct investment (FDI), state asset sales, and solid growth.

However, a revision to a negative outlook could occur if the authorities’ commitment to macroeconomic reform wanes or if economic imbalances, such as foreign currency shortages, rebuild. A negative rating action could also be taken if current geopolitical and tariff-related tensions impinge on Egypt’s external market access and cost of debt.