Egypt has secured a new round of financial support after the International Monetary Fund approved a total disbursement of $1.8 billion. The decision followed the successful completion of the seventh review of Egypt’s Extended Fund Facility program and the second review of its Resilience and Sustainability Facility arrangement.
The Egypt IMF Fund Approval allows the country to immediately access about $1.5 billion under the Extended Fund Facility and around $272 million under the Resilience and Sustainability Facility. With this latest release, total funding provided through the two programs has reached approximately $7.3 billion.
The IMF said Egypt’s economy has remained resilient despite the challenges created by the conflict in the Middle East. According to the organization, the country entered the recent period of regional instability from a stronger economic position than in previous years.
The IMF noted that policy measures introduced by Egyptian authorities helped reduce the impact of external shocks. These measures included maintaining exchange rate flexibility, adjusting energy prices, and controlling public spending.
Economic growth continued to improve during the fiscal year. Real gross domestic product growth reached 5 percent in the third quarter of fiscal year 2025-26. Growth during the first nine months of the fiscal year stood at 5.2 percent.
The IMF expects Egypt’s economy to expand by about 4.6 percent for the full fiscal year. However, growth is forecast to slow slightly to 4.4 percent in fiscal year 2026-27 due to the delayed effects of regional tensions, including weaker investment activity, higher production costs, and ongoing uncertainty.
The Egypt IMF Fund Approval comes as inflation remains one of the main economic challenges facing the country. Inflation declined steadily through early 2026 before rising again in March.
Headline inflation reached 15.2 percent in March before easing to 14.3 percent in June. The IMF said higher energy prices and exchange rate movements contributed to the increase. Inflation is expected to rise again during the second half of 2026 before gradually moving toward the Central Bank of Egypt’s target range.
Egypt’s external position has also faced pressure from higher oil and gas prices. Despite these challenges, strong remittance inflows from Egyptians abroad, healthy tourism revenues, and improving Suez Canal income helped support the economy.
The IMF estimated Egypt’s current account deficit at 4.5 percent of gross domestic product during fiscal year 2025-26. The deficit is expected to narrow in the coming years as trade conditions improve and service sector earnings remain strong.
Foreign exchange reserves also continued to strengthen. The IMF reported that gross international reserves rose significantly by the end of June, supported by renewed financial inflows and central bank purchases.
Fiscal performance remained strong during the review period. Egypt exceeded targets for tax revenue and primary budget balance through efforts to improve revenue collection and control spending.
The IMF projects that the country’s tax-to-GDP ratio will continue to rise. It also expects Egypt to maintain a primary budget surplus of around 5 percent of GDP in fiscal year 2026-27.
While economic indicators showed progress, the IMF said structural reforms have advanced at a slower pace in some areas. Officials highlighted the need to speed up efforts to reduce the state’s role in the economy and increase private sector participation.
Recent divestment transactions generated about $520 million, including proceeds from the Gabal El Zeit deal and government share sales in publicly traded companies. However, the IMF believes further action is needed to accelerate the reform agenda.
The Egypt IMF Fund Approval reflects confidence in the country’s economic management but also highlights the work that remains. The IMF warned that risks include regional instability, high public debt, large financing needs, and slow reform progress.
At the same time, the organization noted that improved regional conditions, stronger investor confidence, and faster reforms could support economic growth and strengthen resilience.
The IMF emphasized that continued fiscal discipline, structural reforms, exchange rate flexibility, and efforts to support private sector growth will be essential for maintaining stability and securing long-term economic progress in Egypt.
