Egypt will have access to about $820 mln subject to IMF Board approval, fund says

The International Monetary Fund said on Thursday that it reached a staff-level agreement with Egypt on the third review of an expanded IMF loan program, which would disburse about $820 million to Cairo upon board approval.

The agreement follows a May 12-26 IMF mission to Cairo to review Egypt's reform performance under an Extended Fund Facility loan that was expanded to $8 billion in March from an original $3 billion loan agreed in December 2022.

The IMF said in a statement that Egypt's efforts to restore macroeconomic stability are making some progress, despite a difficult regional environment marked by spillovers from the war in Gaza and Red Sea shipping disruptions that have hurt Suez Canal receipts.

"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," IMF Egypt mission chief Vladkova Hollar said in a statement.

"These efforts are beginning to deliver an improved outlook, improved FX availability, inflation starting to slow down, and signs of recovery in private sector sentiment."

Hollar said Egypt needed to maintain prudent fiscal policies, continue divestment of state enterprises and maintain tight monetary policy to control inflation.

The IMF said its Executive Board would consider the staff agreement and disbursement in the coming weeks.