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Arab Finance: The International Monetary Fund (IMF) Executive Board has completed the combined fifth and sixth reviews of Egypt’s economic reform program under the Extended Fund Facility (EFF), alongside the first review under the Resilience and Sustainability Facility (RSF), as per a statement by the IMF.
This allows Egypt to immediately access about $2 billion under the EFF and $273 million under the RSF.
Following the completion of the reviews, Egypt can draw around $2 billion, equivalent to SDR 1,465.44 million, under the EFF, in addition to $273 million, or SDR 200 million, under the RSF.
This brings Egypt’s total purchases under both arrangements to about $5.2 billion, equivalent to SDR 3,885.7 million, or 190.7% of quota.
Egypt’s 46-month EFF arrangement, which was approved on December 16th, 2022, has also been extended through December 15, 2026.
Looking ahead, the IMF said Egypt’s priority is to transition toward a more sustainable, private sector-led growth model.
The National Narrative for Economic Development was described as an important framework to enhance competitiveness and strengthen private sector participation, but the Fund stressed that reforms need to accelerate, particularly through reducing the state’s footprint and ensuring a more level playing field.
Key policy priorities include maintaining exchange rate flexibility, completing disinflation, strengthening domestic revenue mobilization, and implementing a comprehensive debt management strategy, alongside enhancing social spending and protections for vulnerable groups.
The IMF also highlighted continued progress in state-owned enterprise and bank governance reforms, as well as climate-related reforms, as essential to supporting resilient, inclusive, and durable growth.
At the same time, it warned that downside risks remain significant, particularly those linked to heightened regional geopolitical tensions, tighter global financial conditions, and delays in the energy sector and structural reforms.
On the upside, a faster pickup in Suez Canal activity or a rebound in hydrocarbon production could support growth and strengthen fiscal and external positions, while Gulf-backed mega projects announced in recent years pose upside risks to foreign direct investment projections.
