The International Monetary Fund (IMF) has approved a $1.2 billion disbursement to Egypt following the successful completion of the fourth review of its $8 billion economic reform program, the Fund announced on Monday.
In a major boost to Egypt’s macroeconomic outlook, the IMF also greenlit a $1.3 billion arrangement under its Resilience and Sustainability Facility (RSF), bringing the total new financing package to $2.5 billion.
Egypt has been in talks to access RSF funding since 2022, aiming to leverage the facility to support long-term climate resilience and structural reforms while alleviating fiscal pressure.
The IMF approvals come as Egypt reports early signs of economic stabilization. Annual urban inflation fell sharply in February to 12.8%, down from 24% in January, while core inflation eased to 10%, compared to 22.6% a month earlier—an encouraging outcome of recent monetary and fiscal adjustments tied to the IMF program.
The country has faced persistent challenges over the past year, including soaring inflation, foreign currency shortages, and a steep decline in revenue from the Suez Canal—an impact largely attributed to geopolitical tensions in the Red Sea region.
However, the latest developments—including the IMF support and record investment inflows from the United Arab Emirates—are strengthening investor confidence. Analysts expect foreign holdings in Egyptian treasury bonds to remain stable, buoyed by improving macroeconomic indicators and the ongoing reform momentum.
The expanded IMF agreement, signed in March 2024, aims to support Egypt’s transition toward a more resilient, private-sector-led economy while addressing longstanding structural vulnerabilities.
