These combined reviews were delayed from the initial staff-level agreement reached in December 2025 until today’s board meeting.
Technical discussions were extended to verify Egypt’s compliance with quantitative targets, particularly the primary budget surplus and foreign reserves, amid volatile economic data during the first half of fiscal year (FY) 2025/2026. This required additional IMF missions, including one to Cairo in December.
A recent cabinet reshuffle and institutional changes, such as plans to abolish the Ministry of Public Sector Enterprises, also required alignment with IMF structural benchmarks related to state-owned enterprise governance and fiscal consolidation.
Board scheduling constraints and closer scrutiny of Egypt’s debt risks, reliance on non-debt financing, and increased social spending, including the EGP 40 billion package, pushed the review date from early 2026 to 25 February, ensuring robust reform momentum before disbursing $2.3 billion.
Approval was expected following the December 2025 staff-level agreement, which would unlock about $2.3 billion in financing, nearly $2 billion from the EFF reviews and $300 million from the RSF.
The funds would support Egypt’s foreign reserves, fiscal consolidation efforts, and structural reforms amid strong economic growth, which reached 4.4 percent in FY2024/2025, ended in June 2025, and declining inflation.
The board will assess Egypt’s macroeconomic stabilization, including its primary surplus target of 4.8 percent of GDP for the current FY2025/2026, which began on 1 July 2025, debt reduction efforts, and social spending through programmes such as Takaful and Karama.
Discussions will also focus on accelerating private sector-led growth, advancing state asset sales, reducing the state’s role in the economy, and strengthening governance in state-owned banks.
While the IMF has expressed optimism about Egypt’s growth outlook and improvements in its balance of payments, it has also highlighted debt risks and called for faster structural reforms to boost competitiveness. Final approval will depend on board consensus, with the agenda confirmed as of 23 February.
Last week, the IMF praised Egypt’s recent steps, including launching a new social protection package, carrying out a cabinet reshuffle, and abolishing the Ministry of Public Sector Enterprises, transferring oversight of state-owned companies to the Sovereign Fund of Egypt (TSFE).
In this respect, the IMF said these policies and institutional reforms have supported discussions on the combined fifth and sixth EFF reviews and the first RSF review.
The IMF also highlighted Egypt's plan to scrap the Ministry of Public Sector Enterprises as a move to streamline oversight, improve governance, and optimize public assets.
These measures align with IMF priorities for fiscal consolidation, private sector growth, and social protection programmes such as Takaful and Karama, building on the December 2025 staff-level agreement.
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