IMF reviews of Egyptian economy expected in September-December: Morgan Stanley

Muhammed Khalid , Sunday 30 Jul 2023

The International Monetary Fund (IMF) is expected to conduct its first and second reviews of the Egyptian economy for the $3 billion four-year loan programme between September and December 2023, according to a recent report by the US-based investment bank, Morgan Stanley.

Morgan Stanley s headquarters. LinkedIn.
Morgan Stanley s headquarters. LinkedIn.


The report, viewed by Ahram Online and published on 27 July, is based on the Egyptian government's recent announcement in July of the sales of state-owned enterprises.

Egypt has been increasing its efforts to fulfil its commitments to the IMF under the Extended Fund Facility (EFF) loan programme, approved in December 2022. The nation received the first tranche of the loan worth $347 million, with the second tranche awaiting the outcome of the first review, initially scheduled for 15 March but postponed to 30 June.

Signs of improvement


Improvement in Egypt's balance of payments, identified by Morgan Stanley's report as a progress indicator, is expected to hasten the IMF's reviews of the country.

The investment bank predicts that Egypt's creditworthiness will be boosted by strong tourism revenue.

The report also revised Egypt's growth forecast for FY 2023/24 to 4.2 percent from the previous projection of 5 percent, but it remains slightly higher than the government's estimation of 4.1 percent.

Morgan Stanley predicts that the Central Bank of Egypt's (CBE) interest rates will remain unchanged during Thursday's meeting, but expects a 200 basis point increase in September due to the subsiding risks facing the economy.

To mitigate the $17 billion financing gap through 2026 and the scarcity of US dollar liquidity in the local market, Egypt has launched a programme to sell state-owned assets, which has generated around $2 billion until now.

Improvements in revenues from the Suez Canal and tourism sector led to a significant decline in Egypt's trade deficit by 29.8 percent to $23.6 billion, according to recent data on the balance of payments performance for July 2022/March 2023.

The CBE's latest meeting in May resulted in keeping the overnight deposit rate, overnight lending rate, and the rate of the main operation unchanged at 18.25 percent, 19.25 percent, and 18.75 percent, respectively

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