Egypt said it is starting negotiations with the International Monetary Fund (IMF) about a possible new loan, citing the consequences of the Ukraine war on international economies.
"In light of the current developments, Egypt has submitted a request to the International Monetary Fund to start consultations regarding a new programme to support the Egyptian state in its comprehensive national economic reform plans," the Cabinet said in a statement late on Wednesday.
The programme might include additional financing, it added.
It said that emerging economies in particular are facing "external shocks" leading to unprecedented increase in prices.
"The rapidly changing global environment and spillovers related to the war in Ukraine are posing important challenges for countries around the world, including Egypt," the IMF said.
Earlier this week, the Central Bank of Egypt raised key interest rates by 1 percentage point at a surprise meeting, in a bid to control rising inflation rates.
This was followed by a sudden devaluation of the Egyptian pound against the US dollar, for the first time in around two years.
The IMF said moves to "implement exchange rate flexibility are welcome steps."
Egypt got a $12-billion, three-year IMF loan in 2016 to help the government implement economic reforms.
In 2020, the IMF provided Egypt with around $8 billion to help it address repercussions of the coronavirus pandemic.
