A $3 billion finance package was negotiated by Egypt and the International Monetary Fund in December, but no date has been set for the initial assessment, an IMF official said on Thursday.
Egypt, which has been experiencing severe financial pressure since since long-standing issues were made public by the economic consequences from the war in Ukraine, received a $3 billion Extended Fund Facility loan from the IMF in December.
Disbursements under the 46-month programme are subject to eight reviews, the first of which was dated March 15, 2023, in an IMF staff report published in December.
“We are in regular dialogue with authorities in order to prepare for the first review… Preparations have started and when we and the authorities are ready we will announce the date,” Jihad Azour, director of the IMF’s Middle East and Central Asia Department, told a news conference.
He said that among priorities were for Egypt to adopt a flexible exchange rate, reduce inflation by using monetary policy instruments, especially interest rates, and open more space for the private sector by levelling the playing field with state companies.
The official Egyptian pound’s exchange rate has remained nearly unchanged for more than a month at about 30.93 to the dollar, despite a promise by the central bank in October to let supply and demand determine its price.
Banks and businesspeople continue to complain of a severe foreign currency shortage, and the pound’s price on the black market has fallen to about 36.00.
In its December accord with the IMF, Egypt also promised to sell state assets worth billions of dollars over the next four years.
It has made no major sales since the signing, though the central bank has raised its overnight interest rates by 500 basis points.
“Egypt has done important reforms over the last few years, and the fund has been very supportive..,” Azouri said. “We are still supportive of Egypt’s reform agenda.”