IMF, Egypt reach staff-level agreement on seventh review of reform programme

CAIRO - 30 June 2026: The International Monetary Fund (IMF) and Egyptian authorities have reached a staff-level agreement on the seventh review under the Extended Fund Facility (EFF) and the second review under the Resilience and Sustainability Facility (RSF).

 

Subject to approval by the IMF Executive Board, the completion of the reviews would unlock around $1.6 billion in financing, including $1.5 billion under the EFF and $136 million through the RSF.

 

The IMF said the latest agreement reflects progress in implementing Egypt’s economic reform programme, while noting that the Egyptian economy has remained resilient despite regional and global pressures.

 

The IMF mission, led by Mr. Mati, held discussions with Egyptian authorities in Cairo from May 11–21, 2026, followed by virtual meetings, focusing on policies supporting economic stability and growth.

 

The fund said Egypt’s response to regional tensions included energy price adjustments, rationalizing government energy consumption, reprioritizing spending, and increasing social protection measures.

 

Egypt’s real GDP growth reached 5 percent in the third quarter, bringing growth for the first three quarters of the fiscal year to 5.2 percent, according to the IMF.

 

The fund added that gross international reserves remained broadly stable by the end of March 2026, while the return of portfolio inflows helped support the exchange rate after earlier depreciation pressures.

 

On fiscal performance, the IMF said Egypt exceeded both primary balance and tax revenue targets by the end of March 2026.

 

The primary surplus is projected to rise from 4.8 percent of GDP in FY2025/26 to 5 percent of GDP in FY2026/27, supporting efforts to reduce public debt.

 

The IMF also highlighted progress in domestic revenue mobilization, with the tax-to-GDP ratio expected to increase by 1.2 percentage points this year.

 

However, the fund warned that risks remain from geopolitical tensions and global inflation pressures. Headline urban inflation reached 14.6 percent in May and is projected to rise to 15.8 percent by the end of the fiscal year.

 

The IMF stressed the importance of maintaining exchange rate flexibility, improving debt management, and accelerating structural reforms to strengthen private sector-led growth.

 

It also highlighted the implementation of Egypt’s State Ownership Policy as a key step toward improving the investment environment, expanding private sector participation, and supporting job creation.