The IMF sees Egypt facing a financing gap of USD 5.8 bn in FY 2025-26, compared to USD 11.4 bn in FY 2024-25, the IMF said in its country staff report (pdf) for the fourth review of our USD 8 bn loan program. The figure is the fund’s projection for our financing gap after accounting for disbursals from the Extended Fund Facility (EFF) as bridging part of the gap. Here are the takeaways from the report:

The government has secured financing commitments for the next 12 months from international partners, which, together with other sources of revenue, will completely close the country’s financing gap, according to the report. This includes financing related to the sale of “development rights or direct real estate sales to external partners of at least USD 3 bn,” the IMF noted. Arab countries have also provided “assurances” they will maintain their deposits — collectively worth USD 18.3 bn — at the Central Bank of Egypt until the end of our EFF arrangement in October 2026, unless they are used for the purchase of equities, according to the report.

Our external financing needs are projected to reach USD 30.4 bn during this fiscal year, before declining to USD 27.5 bn in the FY 2026-27. This marks an increase from the IMF’s third review, when it projected our external financing needs at USD 25.9 bn for FY 2025-26 and FY 2026-27.

IMF now sees Egypt reeling in USD 26.4 bn in external financing during FY 2025-26, compared to USD 24.1 bn projected in its third review. External financing projections for the next fiscal year were revised down to USD 25.9 bn, down from USD 26.0 bn in the third review.

Net FDI will be the biggest contributor among external financing sources, which the IMF expects to reach USD 15.6 bn during the current fiscal year, before inching up to USD 16.9 bn during 2026-27. Both projections have been revised upwards from the IMF’s previous review. The fund estimates that net FDI inflows recorded USD 13.2 bn in FY 2024-25, up from USD 10.8 bn in the third review. Portfolio investments, meanwhile, are anticipated to record USD 7.3 bn in the current fiscal year before falling to USD 5.0 bn in FY 2026-27.

We’re targeting USD 3 bn in asset sales this fiscal year: The government expects to receive USD 3 bn in inflows from asset sales during the current fiscal year, up from USD 600 mn last fiscal year. For FY 2026-27, the figure is expected to hit USD 2.1 bn, which is higher than those presented at the third review. This ramp-up aims to account for the shortfalls in both FY 2023-24 and FY 2024-25, “to maintain the overall divestment envelope the authorities agreed at program approval,” the IMF noted.

Our sources are a little more optimistic: A government source told us earlier this week that the government aims to drum up USD 5-6 bn in fresh investments by offering stakes in six companies — including Banque du Caire, Safi, and Wataneya — on the EGX before 1Q 2026.

THE MACRO PICTURE-

GDP growth outlook: Egypt’s real GDP is expected to grow by 4.1% during this fiscal year, before accelerating to 4.6% growth in 2026-27, the IMF noted. The fund seems slightly less optimistic than the Madbouly government, which sees the economy growing 4.5% in FY 2025-26, before rising further to 5.0% in FY 2026-27.

Inflation outlook: The IMF sees inflation in Egypt reaching 15.3% on average during FY 2025-26, before cooling down to 10.7% on average in the upcoming fiscal year.

The targeted primary surplus for the current fiscal year has been revised down to 4% of GDP, which is 0.5% of GDP less than initially committed in the program. However, for FY 2026-27, the primary surplus is projected to increase to 5% of GDP, bringing it in line with prior program commitments.

External debt forecasts: Egypt’s external debt is projected to record 46.6% of GDP, reaching USD 180.6 bn during FY 2025-26, before falling to 43.3% of GDP, hitting USD 186.6 bn in FY 2026-27. Our external debt service is expected to register USD 46.6 bn during the current fiscal year, before dropping to USD 45 bn in the upcoming fiscal year.

OTHER TAKEAWAYS-

Suez Canal receipts are expected to reach USD 6.3 bn in the current fiscal year, before recovering to USD 8.2 bn in FY 2026-27, bringing them back to roughly the same levels recorded during FY 2022-2023 before the disruptions in the Red Sea since December 2023, reducing foreign exchange inflows from the vital waterway by USD 6 bn in 2024.

Tourism revenues are also expected to recover during the current fiscal year, reaching USD 17.1 bn, before jumping to USD 19.2 bn in the FY 2026-27.

On the monetary policy front, the IMF reiterated that we still need to maintain a liberalized and flexible exchange rate system. “Egypt is exposed to fundamental shocks, such as commodity price and productivity shocks, which require the use of the exchange rate as a shock absorber,” the IMF noted. “The limited variability in the exchange rate despite the numerous shocks that have impacted Egypt warrants further analysis, including on interbank market dynamics to ensure that the reform is sustained,” the IMF wrote, adding that “the perceived stability of the exchange rate is a source of risk in the near term, particularly with

respect to its impact on portfolio flows.”

WHAT’S NEXT- The IMF is set to hold its combined fifth and sixth reviews of Egypt’s USD 8 bn EFF arrangement on 15 September, it noted in its report. Earlier this month, the IMF decided to combine the fifth and sixth reviews, stating that “more time is needed” to make progress on the state withdrawing itself from the economy and the broader reform agenda. The seventh review is scheduled for 15 March, 2026, and the eighth review is set for 15 September, 2026.

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