The International Monetary Fund (IMF) has granted Egypt access to another $820 million in financial assistance after a successful review of the country’s economic reform program. 

While acknowledging the progress in stabilizing the economy, the global lender warned about addressing inefficiencies within the state-owned enterprise sector.

Egypt secured a $8 billion, 46-month loan program from the IMF in 2022 to help navigate a severe economic crisis characterized by soaring inflation and a crippling foreign currency shortage. This announcement marks the third review under this arrangement.

The IMF praised Egypt’s shift to a flexible exchange rate regime, a key policy measure in its reform package. The fund also noted improvements in inflation, foreign exchange reserves, and fiscal performance, including spending on large-scale infrastructure projects.

However, the IMF stressed the importance of accelerating the privatization of state-owned enterprises and implementing reforms to prevent them from distorting competition. 

The lender also highlighted the urgent need to address the energy sector’s fiscal risks, exacerbated by declining natural gas production and the resulting power cuts.

To alleviate these challenges, the IMF recommended a gradual increase in energy prices, including retail fuel costs, to reach cost-recovery levels by December 2025. The Egyptian government raised domestic fuel prices by up to 15%.