IMF Boosts Egypt’s Economy with $2.3 Billion Injection Following Successful Reforms

CAIRO – The International Monetary Fund (IMF) has announced that Egypt will be able to access approximately $2.3 billion from a previously approved loan. This decision comes as the country shows progress in stabilizing its economy and curbing inflation, as part of an ongoing reform initiative.

In a statement released on Wednesday, the IMF highlighted that the decision to disburse the funds follows a positive assessment of Egypt’s government reforms. These reforms have been credited with fostering a “broad-based economic recovery” in Egypt, the most populous nation in the Arab world. The country’s gross domestic product (GDP) demonstrated substantial growth, recording a 4.4% increase from 2024 to 2025.

The initial bailout loan of $3 billion, approved in 2022, was subsequently increased to $8 billion by 2024. This augmentation aimed to support an economy grappling with severe foreign currency shortages and inflation rates that soared to a staggering 38% in September 2023.

The IMF reported that inflation rates had notably decreased to 11.9% by January, a significant improvement from the previous highs.

To combat inflation, Egypt implemented several measures, including allowing the Egyptian pound to float and raising interest rates.

However, the IMF noted that progress “has been uneven.” It said that too much of the economy remains in the hands of the state, and that “decisive efforts to reduce the state’s footprint in the economy will be essential.”

Egypt’s economy has been hit hard by the coronavirus pandemic, the fallout from Russia’s full-scale invasion of Ukraine, and the Israel-Hamas war in Gaza.

Additionally, attacks by Houthi rebels in Yemen on shipping routes in the Red Sea have slashed Suez Canal revenues, which is a major source for foreign currency. The attacks forced traffic away from the canal and around the tip of Africa.

Around 30% of the people in the nation of more than 108 million lives in below poverty line, according to the latest government figures.