IMF approves $1.8 billion for Egypt under reform programme

CAIRO – The International Monetary Fund approved the latest reviews of Egypt’s economic reform programme on Thursday, unlocking about $1.8 billion in fresh financing that is expected to reach the country’s central bank within days.

The disbursement comprises approximately $1.5 billion under the country’s $8 billion Extended Fund Facility (EFF) and about $274 million from the Resilience and Sustainability Facility (RSF), which supports climate and environmental projects.

Mohamed Maait, Egypt’s representative for the Arab Group and the Maldives on the IMF Executive Board, said the funds were expected to be transferred within five business days following the board’s approval, with the Central Bank of Egypt likely to receive the money early next week.

Maait said the combined disbursement would total about $1.774 billion, although the final amount would depend on calculations linked to Special Drawing Rights and exchange rates.

The financing forms part of Egypt’s IMF-backed reform programme, which includes an $8 billion Extended Fund Facility alongside a $1.3 billion Resilience and Sustainability Facility agreed to support structural reforms and climate-related investment.

Economists said the latest tranche would provide a further boost to Egypt’s foreign currency reserves at a time when the country continues to manage heavy external financing requirements.

Fakhri al-Feky, former chairman of parliament’s Plan and Budget Committee and an economics professor at Cairo University, said the inflow would help strengthen the Central Bank’s foreign exchange reserves, support exchange-rate stability and assist in meeting upcoming external debt obligations.

However, other economists warned that Egypt’s debt burden remained substantial despite progress under the IMF programme.

Medhat Nafei, professor of economics at Cairo University, said the government should seek to reduce the cost of servicing its foreign debt, arguing that high interest payments continued to absorb resources that could otherwise be invested in economic development.

According to Nafei, Egypt paid $33.4 billion in external debt service during 2025, including $25.36 billion in principal repayments and $8.06 billion in interest payments. While total debt servicing declined by about 13.6 percent from the previous year, he said nearly a quarter of the payments went solely towards interest.

He said the longer-term challenge was not only to reduce overall debt repayments but also to curb reliance on high-cost borrowing, allowing greater public investment in human capital and economic growth.

The latest IMF disbursement comes as Egypt continues implementing reforms agreed with the Fund, including measures aimed at strengthening macroeconomic stability, improving the business environment and enhancing resilience to external shocks.