European Commission provides €1 billion in macro-financial assistance to Egypt

Today, the European Commission disbursed €1 billion in Macro-Financial Assistance (MFA) to Egypt, an important commitment of the EU-Egypt Strategic Comprehensive Partnership signed in March 2024.  

Ursula von der Leyen, President of the European Commission said: “Egypt is an important strategic partner for the European Union. Today's €1 billion payment shows both the EU's commitment to this partnership and Egypt's efforts to build a stronger and greener economy. This funding is going where it is needed most: economic stability, democracy, sustainability, and the rule of law. And as Egypt advances reforms and strengthens its economy, we continue to work together to make our shared Mediterranean home more secure and prosperous.” 

This financial support, the first of the expected three instalments under the ongoing €4 billion MFA operation, will help Egypt cover part of its ongoing financing needs and ensure macroeconomic stability. It will also support progress within the country's economic reform agenda in conjunction with the ongoing International Monetary Fund (IMF) programme. This support will contribute to addressing Egypt's balance-of-payments pressures, including those stemming from Russia's war of aggression against Ukraine, the situation in the Middle East and the Houthi attacks in the Red Sea.  

In its assessment, the Commission concluded that Egypt fulfilled all the required conditions for the disbursement: first, Egypt met all the economic policy conditions agreed with the EU for this payment; second, the country has taken concrete and credible steps towards respecting effective democratic mechanisms, including a multi-party parliamentary system, upholding the rule of law, and ensuring respect for human rights; and third, the IMF programme remains on track as required for the disbursement of MFA funds.  

As regards the economic policy conditions, Egypt has implemented economic reforms to strengthen macroeconomic stability and resilience, including improvements in the public financial management and the functioning of the foreign exchange market. Progress has also been made in enhancing the business environment and competitiveness, notably through competitive bidding for industrial land allocation and streamlined online licensing. Further progress has also been made in fostering the green transition, including in the areas of water management and energy.