Egypt Reaches Preliminary Agreement with IMF to Merge Fifth, Sixth Reviews amid Cautious Privatization Timeline
Egyptian Prime Minister Mostafa Madbouly announced on Wednesday that the government has reached a preliminary agreement with the International Monetary Fund (IMF) to merge the program's fifth and sixth reviews, allowing more time for strategic state asset sales without compromising value.
Speaking at a press briefing, Madbouly emphasized that while Egypt has met all IMF targets under the Extended Fund Facility (EFF) — including currency flexibility, reserves accumulation, and fiscal discipline — the only exception has been the pace of privatization.
'It was expected that we would achieve a certain volume of asset offerings by a specific date,' Madbouly stated. 'However, we as a government concluded that it was not appropriate to proceed with selling state-owned assets in a market environment that does not ensure fair value. We're not just meeting targets for the sake of it.'
Privatization on Hold Until Market Conditions Improve
The Prime Minister clarified that the delay in public asset sales was a deliberate and economically justified decision, noting that the goal is to maximize value for state-owned enterprises, not just meet numerical targets tied to the IMF program.
As part of the agreement with the IMF, the fifth and sixth program reviews will now be consolidated and postponed until the final quarter of 2025, giving Egypt more time to prepare for favorable market conditions.
Reform Momentum Maintained
Despite the adjusted timeline for privatizations, Madbouly affirmed that Egypt remains fully committed to structural reforms under the IMF program. He highlighted the government's progress on multiple fronts, including:
Maintaining a flexible exchange rate regime
Meeting foreign reserve targets
Reducing public spending and slowing state-led investments
Expanding the private sector's share in total investment
'Across all macroeconomic indicators, Egypt is progressing successfully,' he added.
IMF Agreement and Structural Reforms
Egypt is currently under a $3 billion IMF Extended Fund Facility arrangement, agreed in December 2022, which includes commitments to fiscal consolidation, subsidy reform, and boosting private sector participation in the economy. Privatization is a key pillar of the reform package, aimed at generating revenue and reducing the state's footprint in commercial sectors.
The recent fire at the Ramses Central Telecom hub and the resulting disruptions to digital infrastructure had no reported impact on IMF-related timelines, though they have added to the government's broader narrative on the importance of economic resilience and strategic patience.
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