CAIRO, Dec 23 – The International Monetary Fund said on Tuesday it had reached a staff-level agreement with Egypt on the fifth and sixth reviews under its Extended Fund Facility arrangement, paving the way for a potential disbursement of around $2.5 billion once approved by the Fund’s executive board.
The IMF said the two reviews were combined to allow Egyptian authorities more time to meet critical policy objectives under the programme.
In a separate statement, the Fund also confirmed it had reached a staff-level agreement on the first review of Egypt’s Resilience and Sustainability Facility, which could unlock an additional $1.3 billion in financing, subject to board approval.
Egypt agreed to an expanded $8 billion, 46-month IMF programme in March 2024 as it grappled with surging inflation, foreign currency shortages and mounting macroeconomic pressures.
Since then, inflation has eased sharply from a peak of 38% in September 2023. Annual urban consumer inflation slowed to 12.3% in November, according to official data.
Foreign currency availability has also improved, supported by IMF funding, record tourism receipts, rising remittances from Egyptians abroad and large-scale investment deals with Gulf countries, including the United Arab Emirates, valued at tens of billions of dollars.
“Stabilisation efforts have delivered important gains and the Egyptian economy is showing signs of robust growth,” IMF Mission Chief for Egypt Ivanna Vladkova Hollar said.
However, the Fund cautioned that structural reforms must accelerate, particularly the divestment of state-owned assets, which remains a central pillar of the programme. The IMF said progress on reducing the role of the state in the economy has been slower than expected.
Egypt ratified legislative amendments in August aimed at speeding up asset sales and improving the investment climate.
“Going forward, efforts to reduce the role of the state need to be accelerated,” Vladkova Hollar said, adding that further progress was needed to level the playing field for the private sector.
The IMF has disbursed about $3.5 billion to Egypt under the programme so far, according to Reuters calculations.
