The International Monetary Fund (IMF) has reached a staff-level agreement with the Egyptian government that could unlock approximately $1.6 billion in fresh financing, subject to approval by the Fund’s Executive Board.
The agreement covers the seventh review of Egypt’s Extended Fund Facility (EFF) programme and the second review under the Resilience and Sustainability Facility (RSF). If approved, Egypt will receive about $1.5 billion through the EFF and an additional $136 million under the RSF, bringing total disbursements under both programmes to roughly $7.2 billion.
The IMF said Egypt’s economy has remained resilient despite regional geopolitical tensions and external economic pressures. According to the Fund, the impact of recent instability in the Middle East has been relatively contained due to timely policy measures adopted by Egyptian authorities, including energy price adjustments, tighter fiscal management and spending reprioritisation.
The Fund noted that Egypt recorded real GDP growth of 5 percent in the third quarter of the current fiscal year, with overall growth reaching 5.2 percent during the first three quarters. However, inflation remains elevated, standing at 14.6 percent in May, with projections indicating it could rise to 15.8 percent by the end of the fiscal year.
The IMF urged Egyptian authorities to maintain a tight monetary policy to curb inflation while allowing exchange rate flexibility to help cushion the economy against external shocks.
It also praised Egypt’s fiscal performance, noting that the government exceeded its primary balance and tax revenue targets by the end of March. The Fund projects Egypt’s primary budget surplus will increase to 5 percent of GDP in the 2026/27 fiscal year, up from 4.8 percent in the previous fiscal year.
Despite the positive assessment, the IMF stressed that accelerating structural reforms remains essential. It called for faster implementation of Egypt’s State Ownership Policy, including the sale of state-owned assets, to strengthen private sector-led growth and improve long-term economic resilience.
Egypt first secured a $3 billion IMF support programme in 2022, which was expanded to $8 billion in 2024 as the country battled soaring inflation, foreign currency shortages and broader economic challenges. The latest agreement marks another step in the country’s ongoing economic reform programme, with final approval now awaiting the IMF Executive Board.
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