Egypt is poised to gain access to approximately $820 million pending approval by the IMF Board, according to the fund.

Following a May 12-26 mission to Cairo, the International Monetary Fund (IMF) has reached an agreement with Egypt on the third review of an Extended Fund Facility loan. This agreement, which expands the loan to $8 billion from its original $3 billion in December 2022, is expected to disburse about $820 million to Cairo, subject to approval by the IMF board.

Despite challenges stemming from the regional environment, including spillovers from the conflict in Gaza and disruptions to Red Sea shipping affecting Suez Canal revenues, Egypt’s efforts to restore macroeconomic stability are showing some progress.

IMF Egypt mission chief Vladkova Hollar noted, “While geopolitical tensions and their impact on Egypt remain challenging, the authorities have stayed the course to preserve macroeconomic stability through fiscal discipline, tight monetary policy, and a shift to a flexible exchange rate regime.”

These efforts have begun to yield positive outcomes, including improved foreign exchange availability, a slowdown in inflation, and signs of recovery in private sector sentiment.

Hollar emphasized the importance for Egypt to maintain prudent fiscal policies, continue divesting state enterprises, and uphold tight monetary policy to manage inflation.

The IMF’s Executive Board is expected to review the staff agreement and disbursement in the coming weeks.