File photo: The International Monetary Fund headquarters in Washington D.C. AFP
With this announcement, the three reviews are now pending the approval of the IMF’s Executive Board.
The Executive Board meeting on Egypt is anticipated to be held later this year or in early January. Once approved, the completion of the three reviews will unlock around $2.5 billion for the country.
The IMF mission, led by Vladkova Hollar, visited Cairo from 1 to 11 December and held follow-up virtual discussions with the Egyptian authorities on a package of economic and financial policies supporting the reviews.
In a statement issued at the end of the mission, Hollar said Egypt’s stabilization efforts have yielded “important gains,” with the economy showing signs of robust growth despite a challenging regional security environment and heightened global uncertainty.
Economic activity rose to 4.4 percent in FY2024/2025, which ended on 30 June 2025, up from 2.4 percent a fiscal year earlier, supported by strong performance in non-oil manufacturing, transportation, finance, and tourism.
Growth accelerated further to 5.3 percent year-on-year in the first quarter of the current FY2025/2026.
The IMF noted a marked improvement in the balance of payments, with the current account deficit narrowing as remittances and tourism receipts remained strong and non-oil exports recorded solid growth.
External financial conditions improved in 2025, with non-resident inflows into local-currency debt increasing to approximately $30 billion and foreign currency reserves reaching $56.9 billion.
Fiscal performance remained robust, with a primary balance surplus of 3.5 percent of GDP in FY2024/2025. Tax revenues increased by 36 percent during the fiscal year and by 35 percent in the July–November period of FY2025/26, driven by reforms aimed at broadening the tax base, improving compliance, and streamlining exemptions.
However, the tax-to-GDP ratio stood at 12.2 percent, which the IMF described as modest by international standards.
On monetary policy, the IMF said the Central Bank of Egypt (CBE) has maintained an appropriately tight stance, pursuing cautious and gradual easing to support disinflation. Headline urban inflation edged up to 12.3 percent year-on-year in November after reaching a 40-month low in September.
The IMF also highlighted the need for strong governance practices in the banking sector, given the large presence of state-owned banks, noting the CBE’s commitment to completing third-party reviews to ensure adherence to best practices.
As per the IMF statement, the Egyptian authorities reaffirmed their commitment to fiscal discipline, targeting a primary balance surplus of 4.8 percent of GDP during FY2025/2026, which ends at the end of June 2026, and five percent in FY2026/2027.
A growth-friendly tax reform package is expected to be approved by the cabinet in January 2026, aiming to raise tax revenues by about one percent of GDP next fiscal year.
While the financial position of the Egyptian General Petroleum Corporation remains a fiscal risk, the IMF said recent measures have helped improve its finances, including achieving cost recovery on products covered by the retail fuel indexation mechanism.
The authorities also reiterated their commitment to expanding allocations to the Takaful and Karama cash transfer programme and other targeted social protection measures.
With macroeconomic stabilization underway, the IMF stressed the need to accelerate reforms to support a more competitive, private sector-led growth model.
Discussions focused on the National Narrative for Economic Development, efforts to enhance the business environment, and the importance of advancing the divestment agenda while reducing the state's role in economic activity.
Reforms under the RSF are progressing, with two key measures already implemented in the areas of renewable energy planning and climate finance, while work continues on the remaining reform commitments.
The IMF team expressed appreciation for the constructive discussions and cooperation of the Egyptian authorities during the mission.
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