In its fourth review of its special financing programme with Egypt, the IMF stated that the combined impact of these climate risks could lead to a decline in per capita income of approximately eight percent by mid-century.
The report said that Egypt ranks 110th globally in terms of exposure to climate risks, while ranking 127th in terms of preparedness to address these challenges. This calls for intensified efforts to enhance the country's ability to adapt to climate change and mitigate its economic and social impacts.
A few days ago, the Information and Decision Support Center affiliated with the Egyptian Cabinet stated that, according to a UNDP report, all basic human development indicators have witnessed a noticeable improvement. Per capita gross national income (GNI) at purchasing power parity (PPP) increased from USD13,075 to $16,218 between 2014 and 2023.
Proceeds from the IPO programme are expected to increase
The International Monetary Fund (IMF) raised its forecast for proceeds from the sale of state assets to $3 billion during the 2025/26 fiscal year, compared to a previous estimate of $900 million. The IMF also expected Suez Canal revenues to recover to $6.3 billion during the current fiscal year, rising to $8.2 billion during the 2026/27 fiscal year.
The IMF stated that Egypt faces a financing gap estimated at approximately $5.8 billion during the 2025/26 fiscal year, compared to $11.4 billion during the 2024/25 fiscal year, excluding expected funding from the IMF itself. The IMF confirmed that the government has succeeded in securing firm financing commitments to cover needs during the 12 months ending January 2026, including €1 billion ($1.16 billion) that Egypt received from the European Union in December 2024, as part of a total financing package of €5 billion ($5.81 billion).
The report noted that Gulf countries have committed not to withdraw official deposits from the Central Bank of Egypt worth $18.3 billion until the end of the IMF's Extended Fund Facility in October 2026, unless they are used to purchase assets, with the proceeds of these operations retained in foreign reserves.
The IMF stated that the Egyptian government secured foreign direct investment inflows through land sales worth $3 billion during the past fiscal year, helping maintain the level of non-borrowing financing.
A few days ago, the IMF decided to combine the fifth and sixth reviews of Egypt's $8 billion Extended Fund Facility. The IMF expects the delayed review to be completed in the fall, along with the $1.3 billion tranche the government had expected to receive this month.
Commenting on the IMF's decision, Egyptian Prime Minister Mostafa Madbouly said that the decision came after the programme's objectives were not met due to geopolitical tensions in the Middle East.
Increasing domestic revenues is a top priority for the IMF
The IMF stated that, looking ahead, more decisive implementation of reforms would be critical to ensuring sustainable and strong growth. Priorities include increasing domestic revenues, improving the business environment, accelerating disinvestment, and achieving a level playing field, while enhancing governance and transparency. The IMF expects the external environment to remain challenging, given the ongoing successive shocks.
The Egyptian government is expected to take the necessary legal and regulatory measures by the end of November to introduce a high-quality tax package in the context of the next fiscal year's 2026/2027 budget. This step will lead to achieving the goal of raising the tax-to-GDP ratio by at least two percentage points over the programme period.
The sixth review of the programme is scheduled for mid-September, and the seventh review is scheduled for mid-March 2026.
Photo: The IMF warns that climate change could cut Egypt’s per capita income by 8 percent by mid-century. (By Adobe)