This was revealed by Prime Minister Mostafa Madbouly during a press conference on Saturday.
Although Madbouly didn’t provide specific details, the IMF stated on Friday that the approval from the executive board increases the Extended Fund Facility arrangement from the initially approved $3 billion in December 2022 to $8 billion.
The decision is expected to facilitate an immediate disbursement of $820 million.
According to the IMF Managing Director Kristalina Georgieva, Egypt is facing huge macroeconomic challenges that have become more complex to manage given the spillovers from the recent conflict in Gaza and Israel.
Egypt’s recent IMF agreement, unveiled on March 6, came after the long-anticipated currency flotation, causing the pound to drop 40% against the dollar.
The adjustment was facilitated by funding from a $35 billion deal with the United Arab Emirates, the largest inward investment in Egypt’s history.
However, the country of over 105 million people has also faced additional economic challenges due to conflicts abroad. Russia’s incursion into Ukraine raised wheat and oil import costs, depleting dollar reserves.
Egypt, already the IMF’s second-biggest borrower after Argentina, anticipates receiving $1.2 billion in extra financing from the lender. With the devaluation and commitments in place, investors attracted by high yields and a more affordable currency have surged into Egypt’s local bonds at an unprecedented rate.
