The Egyptian Initiative for Personal Rights (EIPR) today released the English edition of the latest report in its “Eye on Debt” series. The report analyzes the International Monetary Fund’s findings from the fifth and sixth reviews of the Extended Fund Facility (EFF) program with the Egyptian government. It also examines the first review of the Resilience and Sustainability Facility (RSF) loan, which is linked to Egypt’s green transition efforts.

This publication follows the IMF’s publication of the seventh —and penultimate— review report of the extended loan program, with the final review expected before mid-December 2026.

The report concludes that both the Egyptian government and the IMF continue to rely on monetary and fiscal measures to manage the crisis, neglecting the economy's underlying structural challenges. Current government policy remains focused on IMF-mandated requirements: exchange rate flexibility, high interest rates, reduced spending on subsidies and public services, asset sales, and the pursuit of a primary budget surplus. These measures, however, fail to adequately address the root causes of the crisis, such as the high cost of debt, the fragility of foreign currency inflows, weak productive investment, and declining social protection.

The report argues that the relative stability of the exchange rate during the review period does not necessarily reflect a sustainable recovery in the economy’s ability to generate foreign exchange. Instead, it reflects a persistent dependence on short-term capital inflows ("hot money"), driven by high yields on government debt instruments. This dependence complicates serious efforts to manage Egypt’s domestic and external public debt, as interest payments continue to consume a substantial share of both government revenues and expenditures.

EIPR warns that this superficial stability leaves the Egyptian economy increasingly vulnerable to external shocks, as demonstrated during the recent US-Israeli war on Iran. In periods of geopolitical tension or global market volatility, the rapid withdrawal of these funds can place significant pressure on the Egyptian pound and quickly transmit economic shocks to consumer prices.

The report also criticizes the IMF’s repeated praise for Egypt’s achievement of a high primary budget surplus, arguing that the surplus has become an objective in itself while ignoring the largest burden on public finances: debt interest payments. Allocating the largest share of public revenues to debt servicing effectively narrows the fiscal space available for healthcare, education, social protection, and public investment. According to EIPR, improvements in the primary surplus conceal a widening overall budget deficit and growing financing needs, trapping the state in a cycle of debt refinancing rather than reducing its dependence on borrowing.

The report further examines privatization and state asset sales, one of the most contentious elements of the IMF-supported program. While the IMF presents divestment as a means of generating foreign currency liquidity, reducing debt, and expanding the role of the private sector, EIPR argues that selling assets under crisis conditions fails to address the underlying issues. Instead, it may result in the disposal of profitable or strategic assets at below-market values, with a portion of future returns diverted abroad through profits earned by foreign investors.

EIPR stresses that improving market competition does not require the rapid sale of public assets. Rather, it requires reforming market rules, ensuring contract transparency, guaranteeing equal tax and regulatory treatment, and curbing the privileges enjoyed by state-owned companies and projects—factors the organization considers the primary source of market distortion in Egypt.

In its concluding recommendations, EIPR calls for an alternative policy path based on more equitable and disciplined public debt management. The report advocates for consolidating the state budget by incorporating entities currently operating outside the budget framework, establishing a legally mandated borrowing ceiling, adopting a more balanced monetary policy, and implementing progressive tax reform centered on income, wealth, and capital gains—rather than expanding indirect taxation. EIPR also urges a more cautious approach to the asset sale program, increased allocations for social protection, and the regular, transparent publication of poverty, income, and expenditure data.

Finally, EIPR emphasizes that genuine economic stability cannot be achieved through short-term financial indicators, asset sales, or narrow compliance with creditor demands. It requires economic policies that redirect public resources away from debt servicing and toward investment in people, productive sectors, public services, and protection against poverty and inflation.

To read the full report click here