IMF to combine reviews of Egypt's $8 billion loan program
IMF spokeswoman Julie Kozack told a regular briefing that IMF staff were working with Egyptian authorities on finalizing key policy measures, particularly on the state's role in the economy.
A decision to combine the reviews, first reported by Reuters on Tuesday, could delay a new disbursement of funds to Egypt by half a year. Kozack said it was premature to discuss the level of any expected disbursement related to the combined reviews.
The International Monetary Fund approved its fourth review of the program in March, unlocking a disbursement of $1.2 billion and bringing total disbursements to about $3.5 billion.
The 46-month facility was signed in March 2024 following more than a year of severe foreign currency shortages and inflation that peaked at 38% in September 2023.
Kozack said an IMF team met with Egyptian officials in Cairo May 6 to 18 for what she called "productive" discussions.
"Egypt continues to make progress under its macroeconomic reform program, and we can say that there's been notable improvements in inflation and in the level of foreign exchange reserves, which have increased," she told reporters.
However, she said, Egypt needed to deepen its reforms, reduce the state's footprint in the economy and improve the business environment to safeguard macroeconomic stability and bolster resilience.
"Key priorities are advancing the state ownership policy and asset diversification program in sectors where the state has committed to withdraw," she said, adding such steps were critical to enabling the private sector to drive stronger and more sustainable growth.
Staff discussions with authorities suggested that "more time is needed to finalize the key policy measures, particularly related to the state's role in the economy," Kozack said.
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