IMF staff and Egyptian officials continue to make “excellent progress” towardsfinalizing the long-stalled first and second reviews of Egypt’s loan program, the Fund’s director of communication Julie Kozack reiterated on Saturday during a press briefing. The two sides have agreed on the main elements of the program, she confirmed, without providing a timeline for its completion.

The war in Gaza increases the need for a resilient package. “There is a need to have a very comprehensive support package for Egypt,” Kozack added. The IMF is working with Egyptian authorities and its partners “to ensure that Egypt does not have any residual financing needs” as well as “macroeconomic and financial stability” in the country.

We could know more soon: The IMF has been hinting at the near completion of its long-stalledfirst and second reviews of Egypt’s USD 3 bn loan package, with IMF Managing Director Kristalina Georgieva saying that a finalized package would be ready “in a few short weeks,” during the World Governments Summit earlier this month. The Fund is preparing a “large amount” of additional funding to “give a dose of confidence to the Egyptian economy by enhancing the size of the support program,” Georgieva said.

Vote of confidence from Madbouly: “We are very few steps away from completing agreements with the IMF, the World Bank, and the European Union,” Prime Minister Moustafa Madbouly said following the signing of the Ras El Hekma development project (watch, runtime: 18:48).

There is still no word on the exact size of the package, but Enterprise sources withknowledge have put it in the USD 6-9 bn ballpark. Meanwhile, one unnamed government source cited in the local press reportedly believes the government is closing in on a combined USD 12 bn in financing, with the IMF doubling the value of the package it had offered to USD 6 bn and other unnamed “development partners” contributing a further USD 6 bn — a figure echoed by Goldman Sachs.

What we do know: Georgieva and Kozack have both emphasized that Egypt’s policy makersmust focus on reducing inflation and gradually moving towards an inflation-targeting regime. The Fund has also calmed its tone on Egypt’s state asset sale, with Georgieva emphasizing that Egypt should “not rush to sell shares in government companies under the current circumstances,” in contrast to the Fund’s position in April last year.

Reuters also had the story.

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