The International Monetary Fund (IMF) has completed the fifth and sixth reviews of Egypt's economic reform programme, clearing the way for the country to access approximately $2.3 billion in fresh financing. In a statement issued Wednesday, the IMF said Egypt will receive about $2 billion under its 46-month Extended Fund Facility arrangement, alongside an additional $273 million under the Resilience and Sustainability Facility (RSF). The latest approvals bring total disbursements under both programmes to roughly $5.2 billion.
Egypt initially secured a $3 billion loan agreement with the IMF in December 2022. The programme was later expanded to $8 billion in March 2024, as the country grappled with soaring inflation and acute foreign currency shortages. The arrangement is scheduled to conclude in December.
Recent economic indicators suggest some improvement. Inflation, which peaked at 38% in September 2023, has since eased significantly. Annual urban consumer inflation slowed to 11.9% in January, reflecting tighter monetary conditions and stabilisation measures.
Foreign currency pressures have also moderated. The IMF noted that external liquidity has been supported by programme financing, record tourism revenues, remittances from Egyptians abroad, and multi-billion-dollar investment agreements with Gulf partners, including the United Arab Emirates.
“Egypt's macroeconomic situation has improved amid sustained stabilization efforts,” the IMF said. “Tight monetary and fiscal policies, together with exchange rate flexibility, have helped restore macroeconomic stability, reduce inflation, and strengthen the external position.”
Despite the progress, the Fund cautioned that structural reforms have been “uneven.” It pointed specifically to the divestment of state-owned assets, a central pillar of the reform programme, where implementation has lagged expectations.
“Efforts to reduce the state's footprint, particularly progress on the divestment agenda, have been slower than envisaged, while high public debt and elevated gross financing needs continue to constrain fiscal space and weigh on medium-term growth prospects,” the IMF said.
In August, Egyptian authorities ratified legislative amendments aimed at accelerating the sale of state-owned enterprises, signalling renewed efforts to advance the reform agenda before the programme’s expiration.
