(Bloomberg) -- Egypt’s credit rating outlook was raised to positive from stable by Fitch Ratings, after the North African nation secured an international bailout of $57 billion for its cash-strapped economy.

Fitch affirmed Egypt’s B- rating, leaving it six notches below investment grade. It also came weeks after authorities agreed to a landmark $35 billion investment deal with the United Arab Emirates and additional support from the International Monetary Fund and the World Bank. 

“Near-term external financing risks have markedly reduced” thanks to the UAE deal, Fitch said in a statement. “The move to a flexible exchange rate and the tightening of monetary policy” have also helped, the ratings company added.

Those investment pledges and a jumbo interest-rate hike allowed Egypt to let its currency devalue, as part of the country’s efforts to mitigate one of its worst foreign-exchange shortages in decades. 

Authorities had been struggling to reverse the impact of years of a managed currency, as well as an exodus of foreign money in the local debt market after Russia invaded Ukraine. The Israel-Gaza war and attacks on Red Sea shipping by Houthi militants in Yemen have added to the economic pressures. 

Read More: Egypt Unlocks $8 Billion IMF Loan to Ease Crisis With FX Float

Authorities are working on selling more than 30 state-owned companies and assets, a program that’s seeing gradual progress. Other reform efforts include curbing spending and encouraging private-sector growth, in part through minimizing the role of the powerful military in the economy.

S&P Global Ratings has the nation at B- with a positive outlook, while Moody’s Ratings assigns Egypt a Caa1 with a positive outlook. 

--With assistance from Jim Silver.

©2024 Bloomberg L.P.