Cairo: The Executive Board of the International Monetary Fund (IMF) has successfully completed the seventh review under the 48-month Extended Arrangement under the Extended Fund Facility (EFF) and the second review under the Resilience and Sustainability Facility (RSF) arrangement for Egypt. This accomplishment allows Egyptian authorities to immediately draw the equivalent of SDR 1.11 billion, approximately US$1.5 billion, under the EFF and SDR 200 million, roughly US$272 million, under the RSF. Consequently, total disbursements under these arrangements have reached about SDR 5.4 billion, or US$7.3 billion.

According to the International Monetary Fund, Egypt has navigated the economic implications of the war in the Middle East with robust macroeconomic indicators, including strong growth, decreasing inflation, and growing international reserves. The Egyptian economy's resilience is attributed to decisive policy actions, such as exchange rate flexibility and energy price adjustments, which have helped maintain stability. The economic activities have shown a recovery, with real GDP growth hitting 5 percent in the third quarter of FY2025/26, leading to a projected growth of 4.6 percent for the fiscal year.

Inflation trends have experienced fluctuations, with headline inflation peaking at 15.2 percent in March 2026, primarily due to exchange rate depreciation and rising energy prices, before easing to 14.3 percent by June. The current account deficit is estimated at 4.5 percent of GDP for FY2025/26, supported by record remittance inflows, strong tourism receipts, and a rebound in Suez Canal revenues.

Fiscal performance has been robust, with targets for the primary balance and tax revenue surpassed by March 2026, thanks to effective revenue mobilization and expenditure control. However, structural reforms have seen uneven progress. While the State Ownership Policy is a positive development, efforts to reduce state involvement in the economy have lagged.

Despite the achievements, substantial risks persist, including regional tensions and domestic challenges such as maintaining tight policies amid social pressures. The IMF emphasized the need for continued fiscal discipline, structural reforms, and a tight monetary policy to anchor expectations and stabilize the economy. Additionally, maintaining exchange rate flexibility and building reserves are crucial to absorb economic shocks.

The IMF underscored the importance of sustained primary surpluses and robust fiscal management to reduce financing needs and risks. Enhancing financial stability, accelerating structural reforms, and promoting private sector-led growth remain essential for Egypt's economic resilience and stability.