Egypt To Get First Tranche of Expanded IMF Loan Next Week

Egypt To Get First Tranche of Expanded IMF Loan Next Week

– Egypt is to receive the first installment of an extended IMF loan agreement next week, with Prime Minister Mostafa Madbouly confirming the imminent disbursement during a press conference.

– The expanded $8 billion financial support program, succeeding a $3 billion agreement from December 2022, will initiate with an immediate release of $820 million, as stated by the IMF.

– Economic challenges, exacerbated by the Gaza crisis and attacks on Red Sea shipping from Yemen, prompted the IMF to broaden the agreement, recognizing the vital role of tourism and shipping revenue in Egypt’s economy.

Prime Minister Mostafa Madbouly announced during a press briefing that Egypt is poised to receive the initial portion of an expanded loan agreement with the International Monetary Fund (IMF) in the coming week. 

Although Madbouly refrained from disclosing the specific amount, the IMF revealed on Friday that the extended $8 billion financial assistance program will kick off with the immediate disbursement of $820 million.

This agreement builds upon a previous $3 billion, 46-month Extended Fund Facility inked in December 2022, according to Reuters. 

However, this initial agreement was put on hold as Egypt failed to fulfill commitments such as unpegging its currency, expediting the sale of state assets, and implementing other crucial reforms.

The IMF has opted to broaden the scope of the agreement following additional economic setbacks faced by Egypt, including the repercussions of the Gaza crisis, which stymied tourism growth and triggered attacks on shipping in the Red Sea from Yemen.

These events led to a significant drop in revenue from the Suez Canal, which is a vital source of income for Egypt alongside tourism.

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