The International Monetary Fund (IMF) announced on Wednesday that it has completed two reviews of Egypt’s economic reform programme, along with an additional review under the Resilience and Sustainability Facility (RSF), enabling Cairo to draw approximately $2.3 billion.
According to the IMF, Egypt will receive around $2 billion under its 46-month loan programme after successfully completing the fifth and sixth reviews, as well as $273 million under the RSF. This brings total disbursements under both programmes to approximately $5.2 billion.
Egypt initially agreed to a $3 billion loan with the IMF in December 2022. The programme was later expanded to $8 billion in March 2024, amid high inflation and a shortage of foreign currency. The programme is scheduled to conclude in December.
In recent months, the country has managed to curb inflation, which had peaked at 38% in September 2023. Urban consumer inflation stood at 11.9% in January, while foreign currency shortages have eased thanks to the IMF loan, record revenues from tourism, remittances from Egyptians working abroad, and multi-billion-dollar investment agreements with Gulf countries, including the United Arab Emirates.
“Egypt’s macroeconomic situation has improved amid sustained stabilization efforts,” the IMF stated. “Tight monetary and fiscal policies, together with exchange rate flexibility, have helped restore macroeconomic stability, reduce inflation, and strengthen the external position.”
However, the IMF cautioned that structural reforms remain uneven, particularly regarding the divestment of state assets a core aspect of the loan programme.
“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 noted.
In a move to address these concerns, Egypt ratified legislative amendments in August aimed at accelerating the sale of state-owned assets, signaling its commitment to advancing structural reforms.
The IMF disbursement is expected to provide significant support to Egypt’s ongoing efforts to stabilize its economy and attract investment, though experts emphasize the importance of sustaining reforms to ensure long-term growth and fiscal resilience.
