The International Monetary Fund (IMF) board approved a three-year USD12bn loan programme for Egypt on Friday. The approval of programme allows for an immediate disbursement of about USD2.75bn, according to a statement by the IMF. The key features of the economic programme are: i) flexible exchange rate regime to remove overvaluation, rebuild reserves, and provide buffers for external shocks; ii) monetary tightening to contain inflation; iii) fiscal consolidation to ensure medium-term public debt sustainability; iv) strengthening social safety nets and increasing pro-poor spending to offset the impact of the reforms on the vulnerable; and v) structural reforms to promote inclusive growth, create jobs, increase and diversify exports, improve the business environment and strengthen public finance management. The approval comes a week after Egypt had floated its currency, raised interest rates by 3bps and raised the price of subsidised fuel. (IMF press release)