ISSUED BY: GCIS Communications Command Center
SOURCE: Money News
29January2011 12:02amEST
GCIS/MSS INTELLIGENCE UPDATE: Fitch Rating on Friday revised down its outlook for Egypt, dropping it to "negative" as mass protests in the country turned violent, engulfing the capital and other cities in a serious challenge to President Hosni Mubarak's 30-year rule.
Fitch said it was holding steady Egypt's other ratings, including its long-term foreign currency issuer default rating, which was held at the investment grade BB+.
"The Outlook revision reflects the recent upsurge in political protests and the uncertainty this adds to the political and economic outlook ahead of September's elections," said Richard Fox, head of Fitch's Middle East and Africa Sovereign Ratings. Egypt is slated to hold presidential elections in the fall.
The revision comes after the Egyptian stock exchange's benchmark EGX30 plummeted about 17 percent in two days, a drop fueled by investor panic over the Tunisia-inspired protests that erupted Tuesday in the Arab world's most populous nation. The demonstrations have focused on the economic disparity in the country, spiraling food prices and the grinding poverty that afflicts nearly 40 percent of Egypt's 80 million people.
Analysts have downplayed the likelihood that President Hosni Mubarak's regime would be ousted as a result of the protests. But the mass rallies in which tens of thousands have clashed with riot police have pushed to the surface latent concerns about Egypt and raised questions about the economic impact on the country. (read full report)
