In its latest World Economic Outlook report, the Fund further reduced its growth forecast for Egypt for the next fiscal year by 0.6 percentage points to 4.8%, while raising the projected average inflation rate for the current fiscal year to 13.2%, compared with 12.4% previously.
Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, said on Wednesday that the Fund is not currently discussing an increase to Egypt’s program, noting that the Egyptian government has acted with a high degree of responsibility, according to Reuters.
The IMF also trimmed its forecast for Egypt’s economic growth by 0.5 percentage points for the current fiscal year to 4.2%, down from its previous projection of 4.7% in January.
In its latest World Economic Outlook report, the Fund further reduced its growth forecast for Egypt for the next fiscal year by 0.6 percentage points to 4.8%, while raising the projected average inflation rate for the current fiscal year to 13.2%, compared with 12.4% previously.
Georgieva added that the IMF expects at least 12 countries, including several in Sub-Saharan Africa, to seek new borrowing programs due to rising energy prices and supply chain disruptions stemming from the war in the Middle East.
She reiterated that the conflict could generate financing demand ranging between $20 billion and $40 billion, covering both the expansion of existing programs and the creation of new ones.
Georgieva also warned governments against adopting untargeted measures, such as broad energy price subsidies, to mitigate rising costs, stating that such policies would only prolong the period of elevated prices.
On Tuesday, the IMF lowered its growth forecast for emerging and developing markets in 2026 to 3.9%, down from 4.2% projected in January, amid expectations that higher energy and food costs, along with uncertainty linked to the Middle East conflict, will weigh more heavily on vulnerable and commodity-importing countries.
The downward revision was sharper than the Fund’s outlook for advanced economies, underscoring that most developing countries remain more exposed to oil price shocks, currency weakness, and fluctuations in investor confidence.
Meanwhile, IMF spokesperson Julie Kozack told Al Arabiya Business that the Fund remains committed to supporting Egypt as conditions evolve, while assessing the economic impact of the regional conflict on the country.
Kozack added that IMF staff are working closely with Egyptian authorities to move the seventh review of the program toward completion by the summer, ensuring Egypt can meet the requirements set under the agreement.
The IMF has scheduled June and September to complete the final two reviews of Egypt’s program, which would enable the disbursement of the remaining $3.3 billion under the Extended Fund Facility and the complementary Resilience and Sustainability Facility.
At the end of February, the Fund disbursed $2.3 billion to Egypt after completing the fifth and sixth reviews, while noting that structural reforms still require further progress to strengthen the private sector, enhance competitiveness, and reduce the state’s footprint in the economy.
The IMF noted that the economic impact of the conflict will vary significantly depending on a country’s proximity to the conflict, trade and financial linkages, reliance on remittances, and dependence on energy imports.
