IMF unlocks $1.8 billion for Egypt despite regional headwinds

The latest tranche includes $1.5 billion tied to the country's expanded 48-month loan program and roughly $272 million from the Resilience and Sustainability Facility. This financial lifeline arrives as Cairo navigates the fallout of regional instability, which the IMF acknowledges has been managed with surprising resilience. According to the Fund, a shift toward a more flexible exchange rate, combined with disciplined fuel pricing and state spending cuts, helped insulate the economy from recent external shocks.

Economic indicators show a recovery path, with growth hitting 5% in the third quarter of the 2025/26 fiscal year and a full-year projection of 4.6%. Despite these gains, the IMF highlighted persistent structural risks, specifically noting high public debt and significant state involvement in the economy. The lender urged Egyptian authorities to accelerate the divestment of state assets to foster a more competitive environment for private sector investment. Looking ahead, the Fund warned that any further escalation of Middle East tensions threatens to tighten financial conditions and complicate the country's fiscal recovery.