PM — Thousands of businesses are getting a temporary exemption from the new private sector minimum wage

Good afternoon, friends, and welcome to the calm after the storm. The snow has melted, the winds have died down, our ports have reopened after the windy weather forced their closure, and the global markets are stabilizing as dip-buyers reemerge following yesterday’s Omicron-induced selloff.

That said, the news cycle continues to churn at pace, as we hear that some 6k private companies will be given a (brief) reprieve from complying with new minimum wage requirements, and the SCZone signs off on a USD 2.6 bn methanol plant in Ain Sokhna. Elsewhere, your Nutella supply is getting caught in the crossfire in Erdogan’s war on economics, and scientists are hoping to soon unlock the mysteries of the early universe with one extremely large, extremely powerful telescope.

The eight ports forced to close amid yesterday’s stormy weather are back in business: Ain Sokhna, Adabiya, Port Said West, Port Said East, and Al Arish were reopened today, while Port Tawfiq, El Zayteyat and Sharm El Sheikh were back up and running by last night, Reuters reports.

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WANT TO HAVE BREAKFAST WITH US? Every year, we ask our readers to weigh in on what you expect for the year ahead in our Enterprise Reader Poll. Take a few minutes to give us your take on the outlook for your business and industry, whether you’re planning fresh investments and new hires, and how your business fared in the year past. We’ll share the results with the entire community in early January to help you shape your view of the year.

We’ll be inviting eight readers who take the poll to breakfast in 2022 and another dozen of you will get your very own Enterprise mug in which to enjoy your morning beverage of choice.

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THE BIG STORIES TODAY-

#1 Some 6k private sector companies will be given a six-week reprieve from new minimum wage requirements while they are considered for exemptions, the National Council for Wages decided today, according to a cabinet statement. Companies who submitted exemption requests will not have to comply with the requirement before mid-February, while the council assesses the validity of any extension to their requests.

#2 SCZone signs off on Ain Sokhna’s USD 2.6 bn methanol plant: The General Authority for the Suez Canal Economic Zone (SCZone) has signed a land use contract with a company jointly owned by Abu Qir Fertilizers, Helwan Fertilizers, and Al Ahly Capital Holding, to establish a methanol plant at Egypt's Ain Sokhna port and industrial complex, according to a cabinet statement. First announced over the summer, the plant aims to produce 1 mn tonnes of methanol and 400k tons of ammonia annually, a portion of which will be exported. Its first phase is expected to be completed in 2025.

#3- Remittances were up 1.5% y-o-y to record USD 8.1 bn in the first quarter of the FY2021-2022 fiscal year (July-September 2021), the central bank announced in a statement (pdf). The figures tally with a recent World Bank estimate that remittances inflows are on course to hit a record high this year, continuing a trend that saw inflows shrug off the pandemic to register fresh highs last fiscal year.

HAPPENING TONIGHT-

Swvl and Magalix are holding a virtual fireside chat titled Stories of Women in the Tech Field tonight at 7pm. Connect to the event here.

** CATCH UP QUICK on the top stories from this morning’s EnterpriseAM:

• IDH pushes into Pakistan with landmark acquisition: Consumer healthcare giant Integrated Diagnostics Holdings (IDH) will acquire a 50% stake in one of Pakistan’s largest diagnostics providers, marking the company’s entrance into South Asia.
• Nestlé ups investment, packaging manufacturer Uflex opening here: Nestlé Egypt is investing EGP 700 mn in new production lines at its Sixth of October factory between 2021 and 2025, while Indian plastic packaging manufacturer Uflex is planning a new USD 30 mn chemicals plant in Egypt.
• Al Nowais eyes desalination + green hydrogen investments: UAE’s Al Nowais is looking to invest in desalination and green hydrogen projects in Egypt.

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THE BIG STORY ABROAD- The O word is still all that anyone can talk about internationally this afternoon. Bloomberg is expecting the global economy to take a hit due to the variant, writing this morning that global growth is on course to halve to 0.7% in the final quarter of 2021 from Q3.

On the US front pages: Everyone and their mothers in the US media has Biden’s pledge to hand out mns of home covid tests front and center on their front pages. (Bloomberg | Washington Post | WSJ | Politico)

In Europe: There’s still talk of more restrictions coming into play as the variant spreads across the continent. Britain, Germany and Portugal are all considering new measures that could upend the holiday season and put more pressure on retailers and the hospitality sector. (Reuters | DW)

There’s dip-buying aplenty in the European equity markets today as investors dip their toes back into shares following yesterday’s Omicron-fuelled sell-off. Exchanges across the continent are in the green this afternoon and US futures are signalling a similar rebound when markets in New York open shortly.

A temporary calm, perhaps, given the global backdrop, but that’s more that can be said for the TRY, which is whipsawing like crazy today as traders react to new measures announced by the government to shore up the currency. Erdogan’s unorthodox monetary policy has threatened to melt down the TRY, which has plunged to record lows against the greenback in recent weeks. But in a sharp reversal, the currency has soared 25% today after the president announced a new savings-guarantee scheme, which some analysts have likened to a rate-hike via the backdoor. (Reuters | FT).

On that note, nothing is safe from the vagaries of unfettered Erdonomics — including your spoon of Nutella. More on that in this afternoon’s Commute, below.

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???? CIRCLE YOUR CALENDAR-

Swvl and Magalix are holding a virtual fireside chat titled Stories of Women in the Tech Field tonight at 7pm. Connect to the event here.

Jobzella’s Fifth Career Fair is taking place at the GrEEK Campus from 11am-6pm on Saturday, 25 December.

PSA- Property owners have until Friday, 31 December to pay the second installment of their annual real estate taxes without incurring a late fee. The first installment was due between 1 January and 30 June. Homeowners whose primary residence is valued at less than EGP 2 mn are exempt from paying the tax.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

☀️ TOMORROW’S WEATHER- A slight chance of rain and more cold weather: Expect a daytime high of 19°C and a nighttime low of 11°C tomorrow, with a 10% chance of rain, according to our favorite weather app.

The latest victim of Erdogan’s war on rates: Nutella. Turkey's currency crisis is putting pressure on the world's hazelnut supply, with potentially disastrous consequences for the king of nutty chocolate spreads, the Wall Street Journal reports.

Turkey produces 70% of the world’s hazelnuts — a third of which are bought by Ferrero, the Italian-owned company that makes Nutella. But as President Recep Tayyip Erdogan’s bizarre economic policy decisions send the Turkish lira into freefall, the country’s hazelnut farmers are producing fewer crops or even exiting the industry entirely, leading some in the nut market to predict an imminent Nutella shortage.

Why your next jar — if you can get your hands on it — could be pricier: The TRY has lost over half of its value at the beginning of the year on the back of Erdogan’s insistence on cutting interest rates, which he (erroneously) believes will ease inflation. That means farmers are paying above the odds for imported fertilizers, seeds, pesticide and other essentials. Meanwhile, the Turkish government's recent decision to raise the minimum wage by 50% in order to curb inflation (which now stands at above 20% in the country as a result of the backfiring rate cuts) will only raise farmers’ labor expenses. Add to that the fact that the TRY’s volatility has made it near impossible for nut exporters to negotiate fair prices, and Turkey could soon lose market share to other hazelnut producers like Italy, Georgia, and the US. For us Nutella-lovers at the other end of the supply chain, the end result will be that shortages eventually drive up prices.

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Astronomers could soon be able to see some of the earliest moments of the universe: Christmas Eve this year is set to be a landmark day for astronomy as scientists launch the largest, most expensive telescope ever into space, a device so powerful it is expected to allow us a glimpse of some of the earliest moments of the universe. Replacing the Hubble Space Telescope, the USD 11 bn James Webb telescope is roughly 100 times more powerful than its predecessor and has the potential to “remake astronomy” by looking far deeper into space than we ever have before, according to Nature.

Looking back in time: Webb will offer astronomers the chance to look back in time at some of the first stars and galaxies to form after the Big Bang some 13.8 bn years ago, shedding new light on theories about the creation of the universe, how the first stars transformed into galaxies, and the workings of black holes. Trained on galaxies closer to home, Webb could also aid in the search for habitable exoplanets.

A lot is riding on Webb’s success: The telescope has been more than three difficult decades in the making, plagued by technical problems that saw its cost balloon to USD 10.6 bn, from an initial USD 1 bn budget. Largely funded by NASA, the project has invoked scrutiny from government auditors, who have questioned its worth. But if all goes to plan, the payoff from the research it will facilitate could be incalculable: “The telescope was built to answer questions we didn’t know we had,” one astronomer told the New York Times.

???? ON THE TUBE TONIGHT-

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A new Amazon Original film takes us behind the scenes of iconic sitcom I Love Lucy: Fans of the 1950s TV series probably already know that on-screen couple Lucille Ball and Desi Arnaz were also married IRL. Written and directed by Aaron Sorkin, newly released film Being the Ricardos delves into all the drama taking place in the pair’s personal and professional partnership. Nicole Kidman and Javier Bardem take on the roles of the duo in a witty, strong performance that highlights the serious side of the comedy couple, exploring the cracks in their marriage and the influence of politics on their careers. Sorkin also probes the political drama going on in the writers’ room, particularly about how to address Ball and Arnaz’s interracial relationship, which was revolutionary to see on TV at the time. The Guardian and NPR are both out with middling reviews that agree that Kidman and Bardem’s performances carry the film, though they warn that given its dense dialogue and the artistic license it takes with history, Being the Ricardos is more likely to satisfy Sorkin diehards than fans of the original sitcom.

⚽ La Liga is back tonight: In tonight’s big match, Sevilla host Barcelona at 10:30pm. Sevilla are currently in second place in La Liga, and will need a victory if they are to keep pace with leaders Real Madrid who are six points clear having played a game extra. In eighth place, Barca will be hoping to have already reached the nadir of their season, and are looking to make it two victories in two to bring them back into Champions League contention. In the evening’s other game, Villarreal face Deportivo Alaves at 8pm.

As is Serie A: Juventus, who has fallen to seventh place in the Italian league, should have a relatively easy night as they host 19th-placed Cagliari at 10:15pm. At the same time, Genoa plays against Atalanta, and the victory brings the latter closer to the top and temporarily reduces the difference with Inter.

In the UK: The quarter-finals of the League Cup get underway with Arsenal hosting Sunderland at 9:45pm. The League One side are the last remaining non-Premier League team in the competition. The other quarter-final ties will be played tomorrow.

And in the Egyptian Premier League: Smouha and Ismaily are currently on the field as we dispatch, with the score still at 0-0. Meanwhile, Zamalek goes out to face Mokawloon El Arab at 8pm, and before that, Pyramids plays against El Gaish at 5:30pm.

???? EAT THIS TONIGHT-

Chicken everything, from donuts to sushi: Is it possible to love something too much? Heliopolis restaurant The BoGo’s is on a quest to find out. They love chicken with an intensity that has compelled them to incorporate it in dishes where we’ve never seen it before (and for some of us, honestly never hoped to). Their chicken sushi is an innovation that combines fried chicken, smoked beef, and American cheese in a fried sushi roll. The chicken donut, meanwhile, comes topped with melted cheese and BoGo’s special sauce (you can order it on its own or in a sandwich, proving the theory that having more choices does not guarantee better outcomes). But not everything is weird on the menu: more recognizable offerings include the chicken and beef burgers (go for the cracker or the machete), sausages, and main dishes including the steak burger, country fried chicken, and chicken lemon dill. BoGo’s also serves salads of varying nutritional value, from tuna to buffalo chicken. You can find them at Meraki Mall in Heliopolis.

???? OUT AND ABOUT-

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The sixth edition of contemporary dance series Silsilah Dance Program will take place tonight at Rawabet Art Space at 8pm. Titled Tentative 1, the show will feature 16 dancers who come together in “organized randomness”. The program is funded by the European Union in collaboration with the EU National Institutes for Culture, the French Institutes in Paris and Egypt, and Goethe Institute Alexandria.

You can now book your Christmas Eve dinner at Maadi boutique hotel Villa Belle Époque, which will take place from 7pm and feature live entertainment.

???? UNDER THE LAMPLIGHT-

Should we leave behind the idea that we have to be passionate about our jobs? Passion-seeking in employment is a mantra we’ve all heard time and time again, but in Erin Cech’s The Trouble with Passion, she argues that there might be more issues with the concept than just that it’s often hard to obtain. The “passion principle,” Cech says, “helps culturally legitimize and reproduce an exploited, overworked white-collar labor force and broadly serves to reinforce class, race, and gender segregation and inequality.” The sociologist uses interviews, surveys, and experimental data to show that the passion principle is deceptive and helps to undermine the promise of college as a tool for social and economic mobility, penalizing first-generation and working-class young adults. In the workforce, employers covet passion among their staff, but also use it to justify overwork and create precarious employment situations. Cech explores how we can redefine the concept of passion at work and what is seen as a “good job.”

OUR ANALYST OF THE WEEK- Eman Yahia Maree, sector head of consumers, healthcare, and industrials at Arab African International Securities (LinkedIn).

My name is Eman Yahia Maree and I have 14 years of experience in the financial sector. I started my career as a credit risk officer at HSBC, which I did for seven years before I decided to start from scratch in the research field. I became an equity analyst at MubasherTrade while I was studying level one of the CFA, which I received in 2019. I then became a senior financial analyst at Ostoul Securities before landing my position at Arab African International Securities (AAIS). I got promoted this year to sector head of consumers, healthcare, and industrials.

The best part of my job is connecting to international markets. Especially when it comes to industrials, what happens abroad affects the local market and you can make these links in your research. For example, when natural gas prices increased worldwide, we could also sense a shift on the ground here. Consumers and healthcare are more localized, but another thing I enjoy in the field is that you’re connected to top management and investors and there’s room to key performance and operations. You end up with a lot of information.

The worst part of my job is that it’s highly demanding. It requires long working hours and it’s very unpredictable — it can interrupt the best planned vacation [laughs].

My theory of investment is to look for strong fundamentals and attractive industry dynamics. This happens by digging deeper into the industry and analyzing its growth potential and dynamics and seeing how the individual stock situates itself within the bigger picture and how it compares to its peers.

The most important factor I look at is how the macro picture is moving and how it can affect the company performance by offering incentives for example. Industrials worldwide are now affected by the freeze in global supply chains and the exchange rate, and while this is the same in Egypt, companies who have export exposure are at an advantage. However, in consumers, a lot of companies import their raw materials so it’s now struggling due to the disruptions. As for healthcare, the industry is more localized and the dynamics depend on the spread of diseases here in Egypt. It’s a bit different for pharma as we do import raw material for meds which is a key risk. For example, when the EGP floatation happened most pharma companies saw their margins decline.

I think the EGX30 could close in the green for the year. We’re expecting an inflow of IPOs in the coming period as well as consolidation in the market in the form of M&As. The consolidation is already taking place such as in the recent M&As involving Cleopatra Hospitals Group, and SODIC. They help create synergies in the companies and investors usually see them as something positive.

I think 2022 could be the year of Egypt. We’re seeing more movement for public and private firms to reduce their dependence on imported materials and technologies by locally producing them instead. This will help reduce our foreign debt and enable us to take on more projects and investments. On the capital markets front, we’re excited about the state privatization program taking off. The EGX also has a huge potential as it is currently undervalued.

At one point, I’d like to try my hand at private equity. I’m fascinated by the process of due diligence in M&As. Private equity also gives you access to information on the private sector side which isn’t usually publicly available. I’d love this exposure.

In my downtime I like to listen to podcasts, especially those by the Wall Street Journal. They provide information quickly and in a way that’s enjoyable. Other than that, I do a lot of grocery shopping [laughs]. As a consumer analyst, I like to see the difference in pricing at the supermarkets and how the stocks I cover compare to competitive products.

I also do yoga and work out — it’s necessary in a stressful environment.

The last great thing I watched was Squid Game. I usually don’t like watching anything overly violent, but I found the story in the show very different.

The last great thing I read was The Mind Map Book. I like how it helps present information in a simplified and attractive way. I personally find it very useful to consolidate a lot of information and adding pictures helps me memorize things.

I stay organized by creating to-do lists. I started using an application called Any Do and it’s fantastic. I used to lose my physical notebook, but my phone is always on me so it’s efficient.

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MARKET ROUNDUP-

The EGX30 rose 0.4% at today’s close on turnover of EGP 1.18 bn (12.9% below the 90-day average). Foreign investors were net sellers. The index is up 6.3% YTD.

In the green: Rameda (+6.5%), Speed Medical (+3.7%) and Orascom Development Egypt (+3.1%).

In the red: Raya Holding (-2.1%), Elsewedy Electric (-1.4%) and Mopco (-1.1%).