IMF Approves $1.2 Billion For Egypt After Reform Programme’s Fourth Review

The International Monetary Fund (IMF) has approved disbursement of $1.2 billion to Egypt after completing the fourth review of the country’s $8 billion economic reform programme.

The IMF’s executive board also approved Egypt’s request for an arrangement under the resilience and sustainability facility (RSF), with access to about $1.3 billion, the lender’s statement added.

Cairo has requested financing under the RSF since 2022, with hopes it could unlock up to an additional $1 billion.

Egypt on Monday reported headline inflation almost halved in February, helped by financial reforms taken as part of the IMF financial support agreement. Annual urban consumer price inflation decreased to 12.8% in February from 24.0% in January and core inflation also plunged more than expected to 10% on a year-on-year basis in February, from 22.6% in January.

Owing to the IMF deal and record UAE investments, analysts and bankers expect foreign investors to largely roll over their holdings of Egyptian treasury bonds.

Egypt, which has been grappling with high inflation and shortages of foreign currency, agreed to the expanded IMF programme in March 2024. A sharp decline in Suez Canal revenue caused by regional tensions over the past year compounded its economic woes.