IMF Approves $1.2 Billion More for Egypt's Economic Recovery

A woman walks past an exchange office in Cairo, Egypt, Tuesday, Nov. 5, 2024

Africa News with AP

The International Monetary Fund said Tuesday it completed its fourth review of Egypt’s economic reform program approving a $1.2 billion disbursement for the North African country.

The IMF said in a statement it completed its fourth review on Monday and Egyptian authorities can immediately draw the funds. The IMF executive board also granted Egypt’s request for an arrangement under the Resilience and Sustainability Facility with access to an additional $1.3 billion.

Egyptians have been grappling with soaring inflation as they navigate rising daily costs that reached another high last year. They included an increase in fuel prices, a hike in subway fares and a slide in the Egyptian pound against foreign currencies. A recent government decision to raise minimum monthly wages is yet to grant some relief.

Last month, Finance Minister Ahmed Kouchouk announced that the monthly minimum wage for public sector workers will increase to EGP 7,000 ($138) starting in July, up from EGP 6,000 ($118.58). It's meant to match that of private sector workers whose monthly minimum wage increase took effect on March 1. The wage increase for public sector workers comes as part of the government's social protection initiative.

In October, Egypt raised fuel prices between 10% and 17%, a move likely to impact the cost of both goods and services. The cost of a liter of diesel — which is heavily relied on for public transport — increased from 11.5 pounds ($0.23) to 13.5 pounds ($0.25), while the price of 92-octane gasoline rose to 15.25 pounds ($0.31) from 13.75 pounds ($0.28).

Egypt reached a deal with the IMF last spring to more than double the size of its bailout to $8 billion. The price hikes have been deemed necessary to meet conditions set by the IMF for further assistance to the country.