Fitch rates Egypt bond BB+

Fitch Ratings said it assigned the Arab Republic of Egypt's forthcoming Egyptian pound-denominated five-year benchmark bond a BB+. The bond is payable in U.S. dollars.

The rating is in line with Egypt's BB+ long-term foreign-currency issuer default rating.

The outlook has been revised to positive from stable.

"Egypt's creditworthiness is improving gradually, thanks to ongoing economic reforms that address many of the areas that still weigh on Egypt's ratings," Richard Fox, head of Fitch's Middle East and Africa rating team, said in a written statement. "The budget deficit and debt ratio will fall appreciably this year and have clearly turned a corner. Banking system restructuring is nearing completion and further reforms are planned to improve the business environment."

"Growing confidence in the policy framework has brought increased investment and accelerated economic growth. A current account surplus, coupled with strong capital inflows, has increased reserves and helped Egypt attain net external creditor status last year - unusual in the BB rating category," Fox said.

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