Rania Al-Mashat on our podcast + Egypt’s stock buyback boom

A word of friendly advice? Don’t read our interview this morning with International Cooperation Minister Rania Al-Mashat. Listen to it instead. Trust us on this. You’ll get the gist from this morning’s story, but if you really want to get to know the woman leading Egypt’s program of economic diplomacy, you need to hear her tell the story in her own words, in her own voice. She’s smart, engaging and — as she’s proven at the central bank and as tourism minister — just the person you want in your corner in a crisis.

Listening is really easy: Just tap or click here (runtime: 41:05) to listen on our website. No special software required. Or if you’re a podcast nerd, head over to Apple Podcasts or listen to us on Omny. We’re also available on Spotify, but only for non-MENA accounts, and will be on Google Podcasts soon.

Al-Mashat spoke with us for the first episode of Enterprise After Hours, our new podcast featuring business leaders, policymakers and cultural icons. Our aim is to have deeper, longer conversations on a wider range of issues than how to build a great business in Egypt — the subject of our entrepreneur-focused series Making It. Each episode of Enterprise After Hours will drop in its own feed in your podcatcher of choice, accompanied by a written excerpt in the Morning Edition you’re reading now.

Podcasts are the perfect way to kill your morning or afternoon commute. Or if you, like us, aren’t doing that while on WFH, they’re the perfect breakfast / morning routine companion and the ideal way to feed your brain while you do the dishes after dinner.

Want to suggest a guest for Enterprise After Hours or Making It? Email us at editorial@enterprise.press — we would really love to hear from you. We’re already in production on season three of Making It, so email us today.

It’s officially FY2020-2021 for state coffers: President Abdel Fattah El Sisi approved yesterday the state budget for the new fiscal year, according to the Official Gazette. You can catch a refresher on highlights of the budget here and here. The Madbouly government said previously that it will review the budget when 1Q2020-2021 wraps on 30 September to tweak key assumptions as it gets more clarity on the road ahead.

Meanwhile: It’s looking more and more like schools are going to be embracing “blended learning” come fall, with students splitting their time each week between learning at home and learning on campus. That’s the word we’re getting from a number of top private schools in Egypt, and it’s what New York — the largest school district in the US — said yesterday it will be doing.

That’s going to put plenty of pressure on businesses to be flexible with working parents come fall — which, incidentally, is just weeks away. The notion that those of privileged to have jobs that can be done at home have weeks or months of WFH left ahead of us is the subject an on-point CNBC column by Wendy Pfeiffer, CIO of Google-owned cloud computing platform Nutanix.

COVID-19 IN EGYPT-

The Health Ministry confirmed 75 new deaths from covid-19 yesterday, bringing the country’s total death toll to 3,564. Egypt has now disclosed a total of 78,304 confirmed cases of covid-19, after the ministry reported 1,025 new infections yesterday. We now have a total of 22,241 cases who have fully recovered.

Around 1k tourism companies have obtained health and safety certificates to resume operations, 600 of which are in Cairo and Giza governorates.

EgyptAir is offering a 25% discount on flights from Cairo to Dubai booked before 20 July for travel until 20 September. A 20% discount is also available for flights to Abu Dhabi and Sharjah booked before 15 July for travel until 31 August.

ON THE GLOBAL FRONT-

The planet now has 12 mn confirmed cases of the coronavirus, according to the Johns Hopkins University’s corona tracker.

The US has won the inglorious award of being the first country to surpass 3 mn cases, after California, Texas and Arizona all set new single-day records yesterday.

Dubai is expecting an “aggressive” rebound in tourism by the end of the year after the emirate opened its borders to foreign visitors yesterday, Helal Al Marri, director general of Dubai’s Department of Tourism and Commerce Marketing, told Bloomberg (watch, runtime: 07:45).

GLOBAL MACRO-

European banks look to go green: Both the European Central Bank and the European Bank for Reconstruction and Development have outlined plans to increase investment in green bonds as they look to step up involvement in the low-carbon economy. In an interview with the FT, ECB boss Christine Lagarde said that the bank could deploy some of its EUR 2.8 tn emergency asset-purchase program to buy green bonds, while the EBRD announced plans to commit half of its annual investments to green projects by 2025.

That’s good news for: CIB, which we recently reported is planning Egypt’s first-ever green bond issue.

Party time for goldbugs: Gold prices surged past USD 1.8k / oz for the first time since 2011 yesterday, the Financial Times reports. Investors shovelled a record USD 40 bn of cash into gold-backed funds during the first half of the year as the pandemic caused chaos in global financial markets.

Naguib, the inveterate goldbug, expects Au to hit USD 2k: Gold futures could climb to USD 2k an ounce if investors can’t shake their anxiety about the direction of the global economy, celebrity b’naire and La Mancha Mining Chairman Naguib Sawiris told CNBC Arabia yesterday. Sawiris recently said he was interested in the government’s gold exploration tender in the Eastern Desert and getting close to wrapping up talks to acquire a 51% stake in state-owned Shalateen Mining.

AND THE REST OF THE WORLD-

There are now eight names competing to be the next boss of the World Trade Organization after Kenya, the UK and Saudi Arabia put forward candidates at the last minute yesterday. Kenya’s Amina Mohamed — former chair of the WTO’s general council — and Nigeria’s Ngozi Okonjo-Iweala — ex-finance minister and World Bank official — are the frontrunners for the position, the FT says. Egyptian-Swiss lawyer and trade negotiator Abdel Hamid Mamdouh is Egypt’s candidate.

Women’s rights and geopolitics dominated the airwaves last night, with the nation’s talking heads devoting much of their coverage to discussing cabinet proposals to protect the identities of assault victims, and Foreign Minister Sameh Shoukry’s statements on Libya to the UN Security Council

Draft law to safeguard crime victims: Ala Mas’ouleety’s Ahmed Moussa highlighted the cabinet’s approval of a draft law to protect the anonymity of victims of crimes, including sexual assault and harassment. (watch, runtime: 7:48). Masaa DMC’s Ramy Radwan spoke with Maya Morsi, the head of the Women National Council (watch, runtime: 17:09) while Yahduth Fi Misr’s Sherif Amer also gave the story some coverage (watch, runtime: 3:01). We have more on this in this morning’s Speed Round, below.

Egypt voices Libya concerns to UNSC: Radwan covered Foreign Minister Sameh Shoukry’s statement to the UN Security Council yesterday, during which he stressed that Libya had become a safe haven for terrorists and called for disarming militias and reaching a political solution in the country. Shoukry called on the international community to counter the terrorist threat in Libya and noted the resurgence of Daesh in several Libyan cities (watch, runtime: 1:47). Amer (watch, runtime: 1:24) covered the same report.

Former foreign minister Mohamed El Orabi expressed disappointment that the security council failed to adopt a resolution on the Libyan conflict and called for firm positions to be taken against any country involved in supporting terrorist groups. He appeared in an interview with Moussa (watch, runtime: 10:11).

Alexandria Library head weighs in on GERD, Libya: Amer spoke with the head of Alexandria Library Mostafa El Feky, who said that Egypt is not working against Ethiopian interests regarding the Grand Ethiopian Renaissance Dam (GERD), but injustice. He said that the GERD dispute would not be solved regionally but required international intervention to put pressure on Ethiopia. Regarding Libya, El Feky said that Shoukry’s statement to the Security Council demonstrated that Egypt was keen on a political solution to the crisis, and condemned the “Turkish invasion” of Libya, saying Turkey was “transferring” the Syrian conflict to Libya to cripple its development (watch, runtime: 5:03), (watch, runtime: 3:31).

The coronavirus is fuelling a stock buyback boom in Egypt: Since March, EGX-listed companies have been buying back their own shares amid turmoil in global financial markets prompted by the pandemic. As the benchmark EGX30 index fell to three-and-a-half-year lows, experiencing single-day routs unlike anything seen since the political turbulence of 2012, companies jumped at the opportunity to repurchase stock, in what is for the Egyptian market a novel corrective measure in the face of a financial crisis.

First things first: What are buybacks? Share buybacks are when a company repurchases stock from shareholders at market value, reabsorbing that portion of ownership of the company. It has been a common practice since the 1980s globally, and has since reached levels that are setting off alarm bells among some analysts.

What’s the point? It’s a way to drive up your share price while also returning excess cash to shareholders who want out of your stock entirely. More on all of that in a moment.

Buybacks are common in developed markets, but were rare here until the Financial Regulatory Authority stepped in at the beginning of March. As shares around the world slumped in the early days of covid, the FRA made buybacks easier by suspending a three-day notice requirement and allowing companies to buy back shares on the same day, giving companies the ability to buy back their own shares without overtly signalling that sellers might want to drive up the price.

This opened the floodgates: More than 20 EGX-listed companies have bought back anywhere from 0.5-2.5% of their floating shares since the FRA’s announcement. Blue chips including Orascom Development Egypt (ODE), Elsewedy Electric, GB Auto, Palm Hills and Madinet Nasr have all lined up to buy back shares, some immediately after rules were relaxed (see here and here).

What’s the logic underpinning the surge in buybacks?

Supporting share prices: Buybacks help to prop up a company’s share price (even if only temporarily) by decreasing the number of floating shares — available to public investors and not “locked in” and held by company executives, governments or private parties — causing the earnings per share (or EPS ratio) to increase and (the theory goes) demand to rise.

Taking the panic sellers out of the market: “There were people who were in “panic mode” and selling at any price. This of course made other investors nervous. So you go in and buy these shares and eliminate the panic sellers. Now there’s renewed activity around the stock and investors are buying the stock again,” says Hany Berzi, CEO of Edita, which since March has purchased 2.3 mn shares, 0.32% of the company’s total outstanding shares.

It is also a way to telegraph confidence to investors: For private equity outfit B Investments, the market crash in March made it imperative to “send a clear signal” to investors that the company believed its stock was undervalued, Investor Relations Manager Omar Labban told Enterprise. The company’s buybacks communicated confidence in the stock, and that was reflected in investor demand which he says increased more than eightfold. “Before the buybacks began on 29 March, the daily trade was around 6.5k shares a day, that increased to over 50-60k after the buybacks.” The company has bought back around 800k shares, or 0.51% of all outstanding shares, since late March.

Buybacks became an attractive proposition as stocks slid: Companies can use buybacks to invest in themselves when they believe their shares are undervalued. MNHD, for instance, bought back some 7 mn shares, 0.5% of the company’s capital, since the market crash in March. “We believe it was a good opportunity to buy. The price was very low, and we had extra cash. We believe in the value of the company so we wanted to ‘put our money where our mouth is’ as the expression goes,” said Investor Relations Manager Salah Katamish.

Analysts agree: “In March [equities] looked very underpriced … and with the CBE having cut interest rates aggressively in March, the opportunity cost of stock buybacks has fallen,” Simon Kitchen, head of global strategy at EFG Hermes, tells us. “The demand outlook was also unclear at the time, so perhaps companies felt buybacks would be a good use of cash.” Allen Sandeep, head of research at Naeem Brokerage, also said that companies were seeing more value in buybacks than capital investment. “Egyptian stocks have been hammered. Pandemic-driven concerns have led to a severe mispricing of stocks … so we now have a situation wherein companies find more value in investing within, by making buybacks, than making new investments,” he said.

The FRA loosened the rules: Kitchen stressed that the FRA’s move to ease regulations was itself a driving factor behind the surge in buybacks, a view shared by the regulator. “We wanted to make the right policy decision at the right time,” an FRA official told us, speaking on condition of anonymity. “Given market volatility in March, providing companies with the opportunity to buy back stocks right away instead of having to wait 72 hours made a world of difference.”

Buybacks aren’t without their critics: Detractors say buybacks artificially boost share prices while adding no real earned value. They also run the risk of sapping liquidity: “Buybacks can be supportive for stock prices in the short run, but they also reduce freefloat, which can be negative in the longer run,” says Kitchen. There’s also an opportunity cost: Could the money have done more had it been invested or saved to help companies cope during a downturn? “It is arguably better for the economy that companies invest in fixed assets — generating employment and boosting real demand — rather than financial assets,” Kitchen says.

It all comes down to timing, says Berzi: “You have to strike a balance,” says Berzi. “The stock had reached a very low price, and we needed to give support to our stock so we decided to buy shares back. Also to create demand for the stock in light of the covid-19 circumstances and the major deterioration that occurred for all stock prices. It wasn’t the time expansion,” he added.

More on the horizon? With the EGX stabilized and volumes high, buybacks aren’t on the agenda at Edita or MNHD in the near term. MNHD’s Katamish says the company capitalized on a window of opportunity and that there are no upcoming plans to buy more stock. Edita’s Berzi is playing his cards closer to his chest. B Investments, however, is looking at another buyback once it has board approval.

The FRA can always close the door: The suspension of the three-day notice period, while temporary, will remain in effect until an announcement terminating the policy is made. The FRA source says that while it has no plans to do anything to make buybacks even easier, the market regulator has not ruled it out either. “We don’t believe [facilitating buybacks] is necessary at this time, but we are keeping a close eye on the market and we’ll see how things develop,” the source said. “We will make the best decision for what best supports the market at any given time.”

Egyptian equities undervalued after EGX’s covid tantrum -Azimut: Covid-19’s pummeling of the EGX earlier this year has left Egyptian equities sorely undervalued and divorced from the strong corporate fundamentals. This is according to Ahmed Aboul Saad, the managing director of Azimut’s Egypt-focused equity fund, who spoke with Bloomberg on why the Italian asset manager has chosen to dive into Egyptian stocks. The top independent asset manager in Italy, Azimut earlier this month announced that it has launched a USD 50 mn fund dedicated to investing in 20-30 Egyptian stocks.

Egypt is bucking the global trend in valuations: The case of the EGX is a curious one, with the market running counter to global patterns. Around the world, stock prices have been climbing despite huge uncertainty over earnings and the trajectory of the economic recovery. “That also happens in Egypt, but the other way around — valuations are far below the financial performance of the companies,” Aboul Saad said. The EGX suffered a blow earlier this year more than five times the magnitude of the average for emerging markets, making Egyptian companies underpriced in comparison to their peers, he said.

This situation could prove to be a unique selling point for investors, especially for the thousands of individual Egytian expats who may wish to invest in their home country — they’re Azimut’s target market, according to Aboul Saad. Remittances from Egyptian workers abroad are currently under pressure thanks to covid, but are still significant: Egypt is one of the five-largest beneficiaries of worker remittances globally.

Azimut expects Egypt’s economy to grow at a 3-3.5% clip this year: The economy is “very resilient” despite the shock caused by covid-19, Aboul Saad says. “That’s because 80% of GDP comes from local consumption, and you have population growth that boosts consumption, by nature,” he adds. In turn, Aboul Saad sees that the major investment themes going forward are “local consumption and population growth.”

On the state privatization program: Aboul Saad’s fund is eager to see more IPOs than secondary stake sales in already-listed companies when the stalled state privatization program resumes. “I really hope the government can resume the program with new listings, not by selling shares in already listed companies,” he says. The program is on pause until further notice.

The government’s fuel pricing committee left the price of all fuel grades unchanged during its quarterly meeting this week, according to an cabinet statement on Wednesday. The price of 95-octane remains EGP 8.50 per liter, 92-octane is EGP 7.50 per liter, and 80-octane is EGP 6.25 per liter. Gas oil prices will also remain 6.75 pounds a liter.

The committee decided to maintain the current rates following a review of Brent prices, the effect of the global pandemic on oil and energy markets, and FX rates from April to June, according to the statement. Reuters also covered the announcement.

Background: The fuel pricing committee was formed early last year and meets every quarter to review fuel prices. The committee cut fuel prices by EGP 0.25 across the board when it last convened in April.

Technip signs USD 1 bn+ contract for Assiut refinery: French construction firm Technip has signed an engineering, procurement and construction contract worth more than USD 1 bn to build a hydrocracking complex for the Assiut Oil Refining Company, Technip said in a statement. The complex will produce around 2.8 mn tons of clean petroleum products each year using mazut as feedstock. Technip did not specify the exact value of the contract but defined it as a “major” project worth more than USD 1 bn. The company signed an initial agreement with Enppi, Petrojet and the Assiut National Oil Processing Company earlier this year for the project.

M&A WATCH- Ernst & Young values Americana Egypt’s shares at EGP 5 apiece: Ernst & Young has valued the Egyptian Company for International Touristic Projects’ (Americana Egypt) share price at EGP 5 after it finalized a fair value report, the Financial Regulatory Authority (FRA) said in a filing to the EGX (pdf). The FRA is currently reviewing the report to determine whether to accept an MTO for 100% of Americana Egypt’s shares. Ernst & Young was selected for the job last April after Fincorp, which was hired to determine a value for the MTO, was suspended by the FRA for understating the share price.

Background: The authority ordered the UAE’s Adeptio AD Investments to launch the MTO when the latter acquired a 67% stake in Americana Egypt’s parent, the Kuwait Food Company (Americana). Adeptio claimed it should not be required to submit an MTO, but after repeated denied appeals, the company submitted an offer based on a study by Fincorp that valued the target’s shares at EGP 3.9 apiece. Americana’s minority shareholders rejected the price, claiming that the value is somewhere in the region of EGP 24 per share.

M&A WATCH- Lift Slab Egypt is expected to close its acquisition of an 85.2% stake in Al Wafaa for Tourism Investment in the coming weeks, according to an EGX disclosure (pdf). Al Wafaa is a subsidiary of real estate firm Al Fursan Group. The transaction is worth EGP 94.6 mn after Lift Slab agreed to purchase 255.7k shares in the company at EGP 370 apiece. Lift Slab will vote on the acquisition at its next general assembly meeting on 18 July.

CABINET WATCH- Ministers approve safeguards for assault victims after student confesses to serially abusing women: The Madouly cabinet approved amendments to the criminal code that would safeguard the anonymity and personal data of victims of assault, it said in a statement following its weekly meeting on Wednesday. The decision comes in response to the arrest of ex-AUC student Ahmed Bassam Zaki, who on Tuesday confessed to charges that he serially abused and blackmailed a number of women. Maya Morsi, head of the National Council for Women, praised the “historic” decision during an interview with Masaa DMC’s Ramy Radwan last night, saying that it would help to hold aggressors to account for acts of violence committed against women (watch, runtime: 17:09).

Ministers approve draft bills governing slush funds, waste management and more: The cabinet approved new regulations governing the practices of ministerial “private funds,” widely referred to as government slush funds, stressing greater transparency. The government had last year approved channeling 5-15% of surpluses generated by the funds to state coffers.

Also approved by the cabinet on Wednesday:

• Tax officials can be brought to testify: Amendments to a draft law on tax procedures that would allow taxpayers to summon Tax Authority officials in court cases;
• More mining news: A draft law authorizing the oil, local development and housing ministers to enter into agreements with the Central Administration of Mines and Quarries and the New Urban Communities Authority to “develop” the nation’s mineral wealth;
• Educational oversight: Transferring oversight of the Nile International Education System Unit from the Education Development Fund to the Education Ministry.

FRA looks to boost local bond market by cutting the cost of trading, allowing variable-return bonds: The Financial Regulatory Authority (FRA) is close to finalizing recommendations to stimulate trading activity in the local bond market, according to Mohamed Maher, a member of the regulator’s advisory committee and chair of industry lobby group the Egyptian Capital Markets Association (ECMA). The FRA is reportedly considering several measures to draw more investors into the market, including cutting the costs of trading and diversifying securities to include bonds with variable returns and maturities of up to 15 years. Also under review are tax exemptions on investing in bonds and allowing brokerage firms to trade in restricted issuances, Maher said, without providing additional details. The FRA will take the lead in implementing the proposals, coordinating with the central bank and Finance Ministry, he noted.

The FRA will resume discussions during the next few days after shelving talks earlier this year due to the coronavirus pandemic. Maher said.

HSBC Egypt has tapped Todd Wilcox (LinkedIn) as CEO and deputy chairman, according to a statement (pdf). Wilcox succeeds Jacques-Emmanuel Blanchet, who led the Egypt arm of the bank for the past six years. Wilcox was previously deputy CEO of HSBC China.

MOVES- Amr El Alfy (Linkedin) has been appointed as head of research at Prime Securities, according to a press release (pdf). El Alfy was previously the head of research at Shuaa Securities Egypt and Mubasher Financial Services, as well as co-head of research at CI Capital.

The Egyptian Arab Land Bank has appointed Walid Nagy (LinkedIn) first deputy CEO for its Jordan branches, Al Mal reports.

Enterprise After Hours Episode #1 — A conversation with Rania Al Mashat: In trying times, it’s natural to look to leaders for reassurance. We got that and more from the first guest of our new podcast series Enterprise After Hours: International Cooperation Minister Rania Al Mashat (Linkedin). A career economist, Al Mashat rose to prominence at the age of 25, when she became one of the youngest hires ever at the International Monetary Fund. Later, as a sub-governor for monetary policy at the CBE, she was intimately involved in shielding the country from the global financial crisis and helped stabilize the economy following 2011, as well as helping form the 2016 reform agenda. She was then tapped to become Tourism Minister in 2018 at a time when the sector was still struggling to get back on its legs. She’s someone who understands the global macro climate, the nuances of the Egyptian monetary system, and development economics.

A rock in a crisis: Al Mashat is someone whose voice has been called on time and time again when Egypt faces a crisis, making her an ideal first guest for our new series. We spoke about how she sees her ministry leading economic diplomacy today, why the business community should care about sustainable development, and how the current crisis presents an opportunity to achieve that vision.

Tap or click here to listen to the episode (runtime: 41:05) on our website | Apple Podcasts | Omny. We’re also available on Spotify, but only for non-MENA accounts.

Edited excerpts of our conversation:

In short, the role of MOIC is economic diplomacy, says Al Mashat. So when Egypt engages in development projects — whether sovereign projects, public-private partnership projects, or private sector projects — with international partners or institutions, it is the MOIC that coordinates those bilateral and multilateral development partnerships. It connects Egypt to the global economy and works to line up the funding to move the country towards sustainable development.

The MOIC supports both national and private sector projects. What is essential is the viability of the individual projects. Certain international institutions will only provide financing to private sector companies. These institutions back countries that are undertaking reforms, where the private sector can be vibrant, contribute positively, and eventually pay back the financing it is given, says Al Mashat.

The MOIC’s mandate also extends to bilateral cooperation agreements. “If we’re talking about our relationship with Germany, France, or Switzerland, for example, many of these countries also reach out to invest in SMEs.”

The development financing that the MOIC coordinates is just one possible financing instrument for a project, out of an array of sources that include borrowing from domestic banks, taking a loan from the government, or going to international markets. The MOIC works in partnership with individual line ministries to secure development financing with favorable conditions, says Al Mashat. It also creates a platform where multiple stakeholders can partner to fulfil particular development goals. Aswan’s Benban project is an example of this. It’s a public-private partnership, which started with structural reform by the electricity ministry. This enabled private sector firms to go to international partners to get development financing.

This is all part of a larger global goal — financing for the SDGs: The MOIC is essentially responsible for coordinating Egypt’s investment in the 17 Sustainable Development Goals (SDGs), which all UN member states are working to finance and implement between now and 2030. They include overcoming hunger, overcoming poverty, gender equality, innovation, infrastructure, clean energy, supporting life underwater, partnership, promoting health and wellbeing. The MOIC’s design of projects and financing structures is always informed by the question of how the SDGs will be accomplished, she says.

So it is pushing forward with the Global Partnership Narrative (pdf) — designed to create widespread awareness of why the SDGs matter. The aim is for everyone to know why a water desalination in Sinai or Port Said is important for a person in Cairo, or why a Maadi-based STEM school for girls is important for the city of Assiut. These projects show the collaboration between the government and the private sector and the international community, she says.

“In the past five years, we’ve had around USD 25 bn invested in 247 projects spanning the 17 SDGs. We want to document all these projects, so that people can see not just the USD value of this development financing, but see it as an impact value,” says Al Mashat. MOIC produces a weekly digest which it sends to interested parties, says Al Mashat. It will issue a report in July outlining its recent work during the crisis period, she adds.

But covid-19 is forcing a rethink of how Egypt prioritizes action on the SDGs. An updated version of Egypt Vision 2030, which shows how the government prioritizes the SDGs, was due to come out in April, and is now being revisited in light of covid. But some projects are being fast-tracked because of their importance in the current climate, says Al Mashat. These include a collaboration between the Finance Ministry and the World Bank on the new universal healthcare system, transportation projects which will allow for more connectivity and growth, renewable energy projects to generate more clean energy, and projects that support the private sector and SMEs. “All of these are going to reshape the recovery,” she says. While all the goals are important, the government sees mitigating the socioeconomic impact of covid-19 on vulnerable groups as crucial, along with ensuring SMEs remain supported as engines of growth, and putting health front and center.

Still, covid-19’s rapid spread has strained timeframes, and ensuring wider SDG commitments are not forgotten are among immediate concerns over how to mitigate the current situation, Al Mashat adds.

One possible silver lining? Covid-19 is forcing governments throughout the world to implement reforms quickly. “In some sense, as devastating as it’s been, it’s also created a little bit of an expedited reform agenda,” says Al Mashat.

As the only MENA country the IMF sees showing positive growth in the crisis, multilateral partners are confident in our recovery. The IMF’s July 2020 World Economic Outlook predicts 2% growth for Egypt through the end of 2020. This compares to a contraction of -8% for advanced economies and -5% for emerging markets. And engagement from international partners is testament to them betting on the future and on a government that is committed to reforms, she says.

This is not the first time that economic reforms have paved the way for Egypt’s recovery following a crisis. The CBE undertook many reforms between 2005 and 2008, says Al Mashat, so when the global financial crisis hit, Egypt was on a very strong footing. Later, amid the turbulence of 2011, the CBE had so much credibility that it faced very little disruption — especially compared to transition periods in Eastern European countries, she says. “The lesson learned here is that reform is a continuous process, and something that should be prioritized all the time.”

Constant reform is also a personal philosophy that Al Mashat has applied time and again throughout her career. As an advisor to the IMF’s chief economist, Al Mashat spent almost two years using her academic knowledge and her practical experience at the CBE to help countries operationalize their monetary policy and financial stability reforms, contributing to the IMF book Advancing the Frontiers of Monetary Policy. When called to return to Cairo in 2018 and be sworn in as tourism minister, she was asked to apply her economic expertise to run this sector, a key part of Egypt’s GDP, with an economic model in mind. “Whenever you take a new job, you need to take time to understand the initial conditions, by looking at the industry details and identifying stakeholders, potential, internal and external partners. When I was sworn in, Egypt was over halfway through its IMF reform program, which included monetary policy, fiscal policy and structural reforms. Structural reforms are always done on a sectoral level, and I applied them to the tourism sector, bringing the Egypt Tourism Reform Program (E-TRP) with its overarching objective and pillars of reform into play.”

The [redacted] assault charge brought against former student Ahmed Bassam Zaki is leading the conversation on Egypt in the foreign press this morning: Reuters, the New York Times and the National are out with pieces on the story that could prove to be a #MeToo moment that forces a nation into cultural change.

The wider view of stalling GERD talks: The Financial Times outlines Ethiopia’s (or the Horn of Africa’s) century-old resistance against outside interference and how that plays out in their insistence to fill the dam’s reservoirs during the ongoing rainy season — agreement or not.

Egypt reverses US statue debate: Egyptians have criticized a proposal to bring back the statue of French diplomat Ferdinand de Lesseps, who was behind the idea to build the Suez Canal, reports the Associated Press.

US Secretary of State Mike Pompeo has called on the Egyptian government to stop the “unwanted harassment” of US citizens, a few days after Cairo released Mohamed Amashah from prison, AFP reports. Amashah was detained in Egypt for almost 16 months after protesting in Tahrir Square, going on hunger strike in March in protest of his arrest. “We thank Egypt for securing his release and his repatriation,” Pompeo said during a press conference yesterday. “But at the same time, we urge Egyptian officials to stop unwarranted harassment of US citizens and their families who remain there.”