The Executive Board of the International Monetary Fund has completed the fifth and sixth reviews of Egypt’s Extended Fund Facility (EFF) arrangement and the first review under the Resilience and Sustainability Facility (RSF), enabling the Egyptian authorities to access approximately US$2.3 billion in financing, according to an official statement issued by the IMF Communications Department (Media Relations, Press Officer: Angham Al Shami).
The latest disbursement comprises roughly US$2 billion (SDR 1,465.44 million) under the EFF and about US$273 million (SDR 200 million) under the RSF. With this tranche, Egypt’s total purchases under the two arrangements reach approximately US$5.2 billion (SDR 3,885.7 million, or 190.7 percent of quota). The 46-month EFF program, originally approved in December 2022, has been extended through December 15, 2026.
In its published assessment, the IMF stated that Egypt’s macroeconomic conditions have improved as stabilization policies have taken hold. Real GDP growth rose to 4.4 percent in FY 2024/25, while inflation declined to 11.9 percent in January 2026, reflecting the impact of tight monetary and fiscal measures. The current account deficit narrowed to 4.2 percent of GDP, supported by strong remittance flows and tourism receipts. Gross international reserves increased from US$54.9 billion in December 2024 to approximately US$59.2 billion by end-December 2025.
The Fund highlighted exchange rate flexibility as central to restoring external balance and strengthening buffers. According to the statement, foreign exchange interventions should remain limited to addressing disorderly market conditions, while continued reserve accumulation would enhance resilience to external shocks.
On fiscal performance, the IMF noted improvements driven by moderated public investment and stronger tax revenues. However, the primary balance fell short of program targets, largely reflecting delays in anticipated divestment proceeds. High public debt and elevated gross financing needs continue to weigh on medium-term growth prospects and constrained fiscal space.
The IMF emphasized that strengthening fiscal sustainability will require sustained domestic revenue mobilization, including broadening the tax base—particularly through VAT reform—enhancing compliance, and implementing a comprehensive medium-term debt management strategy. The statement also underscored the importance of greater fiscal transparency, tighter oversight of off-budget entities, and faster progress on divestment in non-strategic sectors.
While macroeconomic stabilization has become more entrenched, the Fund observed that structural reform implementation has been uneven. Reducing the state’s footprint in the economy and advancing the divestment agenda remain critical to fostering durable, private-sector-led growth. Governance reforms in state-owned enterprises and strengthened risk management practices within state-owned banks were also identified as key financial sector priorities.
Under the RSF arrangement, Egypt has progressed on climate-related reforms aimed at accelerating decarbonization and strengthening environmental risk management. Completed measures include the publication of a renewable energy implementation schedule and the issuance of a directive requiring banks to monitor and report exposure to climate transition risks.
The IMF cautioned that some risks remain significant, including heightened regional geopolitical tensions, tighter global financial conditions, and potential delays in structural and energy-sector reforms. At the same time, upside risks could arise from a faster recovery in activity along the Suez Canal, stronger hydrocarbon production, or accelerated implementation of large-scale investment projects.
According to the IMF’s Executive Board statement, continued progress across fiscal, financial, structural, and climate reform pillars will be essential to entrench resilience and support sustainable, inclusive growth. While the latest review signals institutional support for Egypt’s policy direction, the Fund indicated that the decisive phase now lies in accelerating structural reforms to secure durable private investment and long-term economic transformation.
