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Financial Outlook

Despite the wide-scale political unrest seen in Egypt since the revolution of 2011, the economy has fared relatively well. The unrest has scared away investors and tourists, but the economy still registered growth of 2.1% in the year to the end of June 2013. Furthermore, in January 2014 Fitch Ratings raised Egypt’s economic outlook from negative to stable, although the rating agency kept its long-term foreign and local currency sovereign credit ratings at B–. It was the first time that Fitch had upgraded Egypt’s economic outlook since the 2011 revolution. Fitch cited an improvement in the political situation, the availability of foreign currency, and financial aid from Gulf countries that has supported the budget. Thanks to this aid, Egypt’s international reserves have also risen, while foreign debt has fallen to 18.9% of GDP. The central bank has sought to boost growth by easing monetary policy, cutting interest rates by a total of 150 basis points (1.5%) since the revolution, including a cut of 50 basis points on December 5, 2013.

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Further reading on Egypt

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