Egypt is preparing for the eighth and final review of its current programme with the International Monetary Fund, scheduled to be held in November 2026 or after, which is the last stage of the Extended Fund Facility (EFF) programme that began in December 2022, after it went through a number of reviews and amendments that raised the size of the agreed financing.
As the programme approaches its final review, the government has begun preparing for the stage after it, as President Abdel Fattah El-Sisi directed the government to prepare a national economic programme setting the priorities of the Egyptian economy after the end of the reform programme with the Fund. At the end of July 2026, Prime Minister Mostafa Madbouly chaired a meeting to follow up on the preparation of the parameters of the national economic programme for the coming stage.
The government had announced that it does not view the end of the IMF programme as the end of the path of economic reform, but rather as a transition to a national programme extending beyond 2026. Madbouly said the government is working on a detailed plan up to 2030 that aims to maintain growth rates, reduce inflation and unemployment and strengthen the social dimension, with a focus on sectors including industry, tourism, and communications and information technology.
The current programme was officially approved on 16 December 2022 with an original value of $3 billion (2.35 billion Special Drawing Rights, SDR) and for a period of 46 months. Then, in March 2024, the Fund approved increasing it by about $5 billion, raising the total agreed financing to about $8 billion (SDR 6.11 billion).
10 Years of IMF Loans
The 2022 agreement was not the beginning of Egypt’s modern relationship with the International Monetary Fund. In November 2016, the Fund approved a programme for Egypt worth SDR 8.597 billion (about $12 billion), and the programme continued until July 2019, coinciding with the implementation of a broad package of economic measures, foremost among them the liberalisation of the exchange rate.
With the repercussions of the coronavirus pandemic, Egypt returned to the Fund in May 2020 and obtained about $2.772 billion through the Rapid Financing Instrument, then in June of the same year obtained SDR 3.764 billion under a Stand-By Arrangement, bringing total financing in 2020 to about SDR 5.8 billion. In December 2022, the current programme was approved with an original value of SDR 2.35 billion, before it was raised in March 2024 to SDR 6.112 billion (about $8 billion). Total agreed financing under the four programmes since 2016 thus reaches about SDR 20.51 billion.
In late July, the Fund completed the seventh review of Egypt’s programme, coinciding with the second review under the Resilience and Sustainability Facility, considering that the Egyptian economy had shown an improvement in macroeconomic stability indicators driven by accelerating growth, declining inflation and rising international reserves, and it considered that Egypt had become better placed to face external shocks compared with earlier periods. But this picture, based on macroeconomic indicators and the State’s ability to manage external pressures and maintain financial stability, looks different when the impact of these policies on citizens is examined.
According to a report Zawia3 prepared earlier, economic experts considered that the improvement in macroeconomic indicators does not necessarily mean an improvement in living conditions, given the continued rise in prices, the decline in purchasing power and the high cost of basic services, in addition to the increasing burdens of debt and its servicing. The experts the report spoke to considered that the test of the economy’s ability to face shocks should not be limited to the State’s ability to provide foreign currency or meet its financial obligations, but extends to the ability of households to bear the effects of crises and reforms, and the ability of the productive sectors to provide jobs and real incomes that maintain the standard of living.
In parallel with the borrowing and reform programmes, Egypt’s external debt followed a fluctuating path that took an upward direction over the long term. According to the official data of the Central Bank of Egypt, external debt rose from $46.1 billion at the end of fiscal year 2013/2014 to $161.2 billion at the end of 2024/2025, an increase of about $115.2 billion, or 250%, in about 12 years. As Egypt enters the final stage of its current programme, the upward path has not stopped: the latest available Central Bank data showed external debt reaching about $163.9 billion at the end of the second quarter of fiscal year 2025/2026, an increase of nearly $2.7 billion in six months.
How Can Egypt Do Without the IMF?
Egypt’s obligations to the International Monetary Fund do not end with the end of its current programme in 2026; the eighth and final review means the end of the programme only in terms of reviews and disbursement of financing, without meaning the end of the loans Egypt owes the Fund. According to the expected payments schedule issued by the Fund, Egypt will continue paying its obligations until 2046, with total expected payments of about SDR 9.93 billion, including the principal of the loans as well as interest, charges and assessments.
The Special Drawing Right is an international reserve asset created by the Fund in 1969. It is not a currency in its own right and is not traded on markets like the dollar or the euro, but a unit of account that the Fund uses in its loans and payments with member states. Its value is calculated daily based on a basket of five major currencies (the US dollar, the euro, the Chinese renminbi, the Japanese yen and the pound sterling), and their weights are reviewed every five years. According to the latest official rate issued by the Fund on 18 August 2026, one unit equals about 1.37 US dollars, a rate that changes daily with movements in the exchange rates of the currencies that make up the basket.
Dr. Gouda Abdel Khalek, professor of economics and former Minister of Supply, tells Zawia3 that exiting the cycle of repeated reliance on the IMF is not achieved merely by the end of the current financing programme, but requires a change in the structure of the economy that reduces the State’s need for external borrowing at every crisis. He places at the forefront of this change curbing monopolies and strengthening competition, while activating market regulatory bodies and giving them the ability to confront monopolistic practices, in a way that raises production efficiency and the competitiveness of the local producer.
Abdel Khalek stresses the need to achieve a greater degree of stability in the exchange rate of the pound, and to rebuild the production structure to reduce dependence on imports and foreign inputs, by directing investments to gaps of strategic importance and increasing the linkages between productive sectors, so that external shocks are not transmitted directly to the local economy. He sees the importance of making greater use of Egypt’s membership in the World Trade Organization to improve the terms of dealing with external markets, and adds that controlling government spending and reconsidering the structure of the State’s administrative apparatus are part of the required reform, stressing that doing without the Fund does not mean only increasing foreign currency resources, but building a more productive and diversified economy that is less exposed to shocks, so that exiting the cycle of borrowing becomes the result of a broader structural reform that ends with the State being able to finance its needs from its own resources.
Abdel Khalek does not separate economic reform from the reform of local administration, considering that the local councils are one of the files that need radical change, as he believes that the absence of elected local councils deprives citizens of a direct mechanism to hold the governor, the city head and the district head accountable, and weakens oversight of decisions, spending and services at the local level.
Egypt has not held elections for its local councils since 2011, that is, for about 15 years, even though this vote is considered the fifth constitutional entitlement since 2013, after the referendum on the constitution and the elections for the presidency, the House of Representatives and the Senate. During this period, executive bodies have taken over the tasks of the local councils without elected councils to monitor the performance of governors. The issue of local elections is now returning to the fore with the House of Representatives’ Local Administration Committee discussing a new draft local administration law, which aims to reconstitute the councils and hold direct elections for them at multiple administrative levels, from villages and districts up to governorates, in a way that strengthens decentralisation and expands local political participation, following directives issued by President Abdel Fattah El-Sisi to complete the constitutional entitlement of local council elections.
Five Pillars for a Genuine National Programme
According to what the Egyptian government has announced, the national economic programme for the post-IMF stage is heading towards setting new priorities for the economy, with a focus on reducing dependence on borrowing and increasing the economy’s ability to generate its resources from within. Its most prominent features include reducing the burden of external debt and restructuring it, expanding concessional financing, increasing direct investment, accelerating the government offerings programme, and supporting the productive sectors, especially industry and agriculture, in a way that helps increase exports and reduce dependence on imports. According to the announced statements, it also includes deepening local manufacturing and localising industries, raising the efficiency of factories and increasing the utilisation rates of production capacities, revitalising the tourism sector as a main source of foreign currency, and linking technical training to the needs of the labour market. At the level of monetary policy, exchange rate flexibility is expected to continue, with a monetary policy that balances reducing inflation and supporting growth, and the government affirms that the programme will be put up for public dialogue before it is officially announced, and that it will include clear targets, measurable indicators and follow-up mechanisms.
Economic researcher Elhamy El-Merghany puts forward a set of pillars that he believes could form the basis of a national programme in which Egypt’s dependence on external borrowing and hot money flows is reduced, and its ability to finance development from its domestic resources increases. Foremost among them, as he tells Zawia3, is increasing domestic savings rates in a way that provides greater sources of financing for investments, in addition to directing more attention to agriculture and industry as two productive sectors capable of creating jobs, increasing value added and providing foreign currency by increasing exports and reducing imports.
El-Merghany also proposes restructuring the tax system by increasing reliance on direct and progressive taxes on incomes and wealth and activating property taxes, while reducing reliance on consumption taxes and value added tax, in a way that raises the contribution of tax revenues to financing the budget and reduces the need for borrowing. On the file of State assets, he sees the need to stop selling State-owned assets and companies and to move instead towards drawing up plans to operate them and maximise the return from them, and he also calls for halting the implementation of projects that do not represent an urgent priority, and for no new project to begin before a clear feasibility study that determines the economic return, the capital payback period and the expected cash flows. According to El-Merghany, these measures could allow Egypt to rely more on domestic resources and direct investment, and reduce its dependence on loans and hot money flows.
القرض أسرع من القطار: كيف تجاوزت ديون «القومية للأنفاق» تريليوني جنيه؟
The Real Starting Point Is Production, Not Financial Stability Alone
Economic and labour researcher Hassan El-Barbary tells Zawia3 that the end of Egypt’s current programme with the IMF does not mean the end of the relationship between the two sides, given that Egypt is a member of the Fund and has a quota in it that it increased over the past two years, and he considers that what is happening may be an attempt to explore a new form of cooperation in the future, even with the announced move towards a national programme.
El-Barbary says that adopting a genuine national programme first requires a shift in the State’s economic goal: after years in which policies focused on achieving financial and monetary stability, the priority must move to rebuilding the productive base and achieving production-based growth, in a way that provides real resources to repay debts and finance development. In his view, this includes rebuilding the sectors of manufacturing, agriculture, pharmaceuticals, engineering, electronics and renewable energy, with each sector including components that can be exported to provide foreign currency, and others capable of replacing imported goods and reducing demand for foreign currency.
He adds that the coming stage also needs a reformulation of exchange rate policy, instead of settling for its flexibility according to market mechanisms, in addition to reforming tax policy and broadening the tax base horizontally instead of increasing the burden on existing taxpayers, and he sees the need for a clear national programme for wages and social protection, alongside redirecting public investment towards sectors such as public transport, education, health, water, scientific research and digital infrastructure.
El-Barbary points out that one of the most important elements of any national programme must be the establishment of an early warning system for crises, including clear indicators to measure the economy’s ability to face shocks, among them the level of foreign reserves and the extent to which they cover imports and external obligations, and the direction of external debt and its ratio to export proceeds, with these indicators serving as the basis for clear rules for dealing with crises, especially since the Egyptian economy has been affected in recent years by successive shocks, from the coronavirus pandemic to the Russian-Ukrainian war and the tensions in the region.
El-Barbary concludes that the repetition of external shocks has revealed, in his view, the limited ability of the Egyptian economy to absorb them, as their effects were passed on to citizens in the form of increases in electricity prices and cuts in subsidies, while the State moved to secure resources that help it meet its financial obligations; therefore, in his view, the transition to a national programme requires a reconsideration of the broad lines of economic policy, if there is a genuine political will to build an economy more capable of facing crises.
According to the payments schedule and the experts who spoke in this report, the end of the IMF programme does not mean that Egypt has exited the cycle of debt or become independent of external financing: the obligations owed to the Fund will continue for years after the end of the programme, while external debt remains at high levels, and the economy needs continuous flows of foreign currency to meet its obligations and finance its needs. While the government puts forward a national economic programme for the coming stage, the real test remains its ability to move from managing crises to preventing their recurrence; from focusing on providing foreign currency and repaying debts to building productive sectors capable of generating it; from relying on borrowing and selling assets to increasing investment, production and exports; and from making households bear the cost of reform to building policies that protect their incomes and purchasing power.
