Egypt is set to receive a USD 1.2 billion disbursement from the International Monetary Fund in January 2025, as part of its USD 8 billion Extended Fund Facility programme.
This development follows a staff-level agreement reached in December 2024 during the fourth review of the 46-month arrangement, which is scheduled to conclude in September 2026.
Egypt’s Finance Minister Ahmed Kouchouk confirmed the anticipated disbursement during an interview on ON TV, stating that the IMF’s executive board is expected to convene in January to finalize the process. He emphasized that Egypt has not sought an increase to the original USD 8 billion loan agreement.
The EFF programme, initially approved in December 2022 as a USD 3 billion arrangement, was expanded to USD 8 billion in March 2024 to address Egypt’s economic challenges, including high inflation and foreign currency shortages.
To date, Egypt has received USD 2 billion of the loan, distributed in three instalments: USD 347 million in December 2022, USD 1.1 billion in April 2024, and USD 547 million in August 2024.
Egypt’s economic difficulties have been compounded by a decline in Suez Canal revenues, attributed to regional tensions over the past year. The canal, a vital source of foreign currency, has experienced reduced maritime activity, further straining the nation’s financial position.
In response to these challenges, the Egyptian government has implemented several measures to stabilize the economy. These include monetary tightening to combat inflation, efforts to maintain a flexible exchange rate, and initiatives to attract foreign investment. Additionally, the government has been working to reduce its external debt, with plans to decrease it by USD 2 billion annually.
Looking ahead, Minister Kouchouk indicated that Egypt aims to secure approximately USD 3 billion through diverse issuances by the end of the current fiscal year, concluding in June 2025.
While he did not provide specific details on the nature of these issuances, they are expected to target a broad range of investors. This strategy aligns with Egypt’s broader economic reform efforts, which include commitments to privatization and enhancing the role of the private sector as a primary driver of growth.
The IMF programme also encompasses structural reforms aimed at improving financial stability and fostering sustainable economic growth. These reforms include enhancing the efficiency of public sector enterprises, increasing tax revenues without raising tax rates, and gradually shifting from commodity subsidies to direct cash payments to better support vulnerable populations.
As Egypt navigates these economic reforms, the forthcoming IMF disbursement is anticipated to bolster the country’s foreign reserves and provide critical support in addressing fiscal challenges.
The government’s commitment to implementing the agreed-upon reforms remains pivotal in achieving the programme’s objectives and helping to restore economic stability.