USD surges after central bank raises deposit cap

TL;DR

USD surges after central bank raises deposit cap. (Speed Round)

International oil companies don’t have plans to flee Egypt. (Speed Round)

U.S. Fed leaves rates unchanged, CBE’s Monetary Policy Committee meets today. (What We’re Tracking Today)

Cabinet members honor 50 “most influential women in the Egyptian economy.” (Speed Round)

So much for rapprochement: Qatar files USD 150+ mn claim against Egypt at international arbitration panel. (Speed Round)

Gov’t wants Abu Dhabi to buy Egyptian USD bonds. (Egypt Politics + Economics)

Businessmen’s association, Federation of Industries give thumbs-down to proposed Labor Act. (Egypt Politics + Economics)

By the Numbers

WHAT WE’RE TRACKING TODAY

The Central Bank of Egypt’s Monetary Policy Committee is meeting today to discuss interest rates.

The US Federal Reserve kept interest rates unchanged at 0.25-0.5% yesterday, pledging to monitor financial markets and economies overseas amid plunging commodity prices, according to its official statement. The central bank is reportedly assessing “gyrations around the world” for the risks to the U.S. economy, “leaving its options open as traders bet policymakers will leave rates unchanged until the second half of the year,” writes the Financial Times (paywall). Or check out Reuters or the WSJ (paywall).

BG Group shareholders vote today on the acquisition by Royal Dutch Shell, with expectations being that the acquisition will be approved. Shell’s investors greenlit the company’s acquisition of BG yesterday with 83% of the votes cast backing the transaction, which the FT (paywall) describes as “the biggest” in the energy sector in over a decade. Barring an unexpected voting upset, the transaction will formally become effective on 15 February.

WHAT WE’RE TRACKING THIS WEEK

The 26th African Union Summit in Addis Ababa is taking place until 31 January. President Abdel Fattah El Sisi is set to hold meetings with Ethiopia and Sudan over GERD during the event. We haven’t seen anything as yet that suggests when the president may be holding those meetings, but we’ll be on the lookout for any updates that emerge.

ON THE HORIZON

The second Egyptian-Russian forum hits the ground running next Monday, with Trade Minister Tarek Kabil meeting with Russian counterpart Denis Manturov and a delegation of 100 Russian companies. The ministry is expected to sign the Egyptian-Russian-Emirates fund agreement during the forum, according to Al Mal (more in Diplomacy + Foreign Trade)

And while we’re on Russia, the country is expected to sign an MoU with Egypt for a Russian industrial zone in the Suez Canal sometime next week (31 January–2 February to be exact)

Mubarak-era Prime Minister Ahmed Nazif’s retrial in a corruption case is scheduled for Wednesday of next week.

LAST NIGHT’S TALK SHOWS

Wednesdays are the slowest days on the talk show front, and last night was no exception: With Amr Adeeb off, Al Qahera Al Youm decided to dedicate a segment to horoscopes and Ibrahim Eissa discussed the merits of long johns. Nope — not a metaphor. He literally discussed the importance of long underwear to combat the cold, and given temperatures the past couple of days: We approve.

On a less, uh, personal front: Khairy Ramadan hosted four experts on Momken to discuss lifting sanctions against Iran. Medhat Youssef, former vice chairman of the Egyptian General Petroleum Corporation, argued that the reason petroleum prices didn’t plunge after Iran entered the international market is that it revisited the volume of exports it had previously planned. “Iran has huge development plans. To achieve them, they need to maintain international petroleum prices as they are,” said Youssef. “They can’t do this without capping their petroleum exports.” He added that there are rumors that Saudi Arabia and Russia are announcing a production ceiling soon. Youssef also argued that petroleum would not be used as a “weapon” in the upcoming period.

Iran specialist Ahmed El Soufi said the struggle Iran was never a religious one between Sunnis and Shiites, but rather a political one. “The West started focusing on Iran being Shi’ite only after the Iranian revolution.” Mohamed El Said Idris, head of the Arab Studies Unit at the Ahram Center for Political and Strategic Studies, agreed, saying Saudi Arabia was an Iranian ally in the past.

In between talk of the cold and long johns, Eissa managed to squeeze in a little about the economy, saying, “There would be no development without investment, and we cannot attract foreign investors before attracting the Egyptian investor. What is happening right now is punishing investment and not encouraging it.” He also hosted Nader Nour El Din, former advisor to the minister of supply and a professor of agriculture, to discuss food subsidies.

“Right now there are 80 mn [people] receiving subsidies and subsidized bread. We are 90 mn [people], so this means 90% of Egyptians are extremely poor. This cannot be true. The numbers are exaggerated and nowhere near international rates,” said Nour El Din. “Here we find bread cards with 12 people listed on them. We need to cap the number of people on subsides like many other countries do. We shouldn’t be encouraging people to have 10 children, and subsidy cards should [not have] more than five people on each.”

Nour El Din also said that while international wheat prices dropped 50%, this didn’t reflect on the price of bread in Egypt. Some EGP 500 mn is spent on bread points that go to those who don’t deserve it, he said. “Why am I giving subsidies to university professors? And how are we subsidizing jam and washing machine detergents?”

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SPEED ROUND

USD surges against EGP after CBE raises deposit cap: The price of USD on the parallel market surged after the CBE raised the cap on USD-denominated deposits for some importers, Reuters reports. “Speculators used the confusion caused by the central bank decision to push the pound lower … A huge wave of demand on USD hit the market after raising the cap,” one trader tells the newswire. Parallel market traders said the USD strengthened EGP 0.10 following the announcement to EGP 8.72-8.75 per USD 1.

International oil companies have not threatened to withdraw their investments from Egypt, the Oil Ministry’s spokesperson tells Al Shorouk. The statement denies news reports that four IOCs, which were not named, have said they would pull their investments out of Egypt if they have not paid their receivables before March. The spokesperson says IOCs operating in Egypt understand the problems that led to the build-up of debts and are aware of the ministry’s commitment to repaying them in full.

Uh, wait, did the EGX30 just become the EGX29? The EGX has revised the EGX30, removing Sidi Kerir Petrochemicals, Misr Cement Qena, Beltone Financial and EK Holding and adding Emaar Misr, South Valley Cement and United Arab Stevedoring. Read the official statement here. By our math, (30-4)+3 = 29, so what gives? The index now reflects the split of Amer Group into Amer and Porto groups, and the rebalancing yesterday actually turns what was a 31-constituent EGX30 into a real EGX30. The list lives here on the EGX website, but has not yet been updated.

The Finance Ministry has asked the Tourism Development Authority (TDA) not to pay JWT until alleged tax issues are resolved, Al Borsa reports. JWT is conducting a USD 68 mn international marketing campaign for TDA but has not yet been paid, TDA’s deputy head says, noting the authority opted not to intervene in the dispute but was asked by the Finance Ministry to freeze payments. He said he expects the issue to be resolved within 10 days.

Ministers Ashraf Salman and Tarek Kabil honor 50 most influential women in the Egyptian economy: “The move aims to highlight Egyptian women’s crucial role in various economic sectors such as banking, industry, real estate, communications, and entrepreneurship,” Daily News Egypt reported. EFG Hermes Chairperson Mona Zulficar, ADIB CEO Nevine Loutfy, Emirates NBD Egypt Deputy MD Sahar El Damaty, Citibank Egypt VP Lamis Negm. The list also includes current and former ministers Sahar Nasr, Ghada Wali and Nabila Makram Ebeid as well as the president’s national security advisor, Faiza Aboul Naga. The CBE’s Lobna Helal and Rania El Mashat also made the list.

Edo ergo sum- Argentina said to get approval for Egypt-bound wheat cargoes -sources: Following reports that Egypt rejected a cargo of French wheat supplied by Bunge due to trace amounts of ergot fungus, Bloomberg reports GASC has approved shipments of wheat from Argentina, according to unnamed sources. The grain shipment is reportedly supplied by Louis Dreyfus Commodities BV. “We can’t say Argentina is ergot-free, but for sure we can say we haven’t seen ergot in our wheat crops for many, many years,” Bloomberg quotes Lisardo Gonzalez, director of a wheat-seed supplier firm, as saying.

Moves- Khaled Bichara was appointed ad-interim CEO and board member of Orascom Hotels and Development, a subsidiary of Orascom Development (ODH). Bichara is the CEO of OHD parent company ODH.

Prime Minister Sherif Ismail’s cabinet held their weekly meeting yesterday. Among the decisions made:

• Authorizing the formation of a task force to sort out a plan to stem the flow of red ink at state broadcaster ERTU. Task force members will be drawn from ERTU and the ministries of planning, finance and investment.
• Greenlighting a joint stock company to look into ways to profit from natural protectorates;
• Giving the go-ahead for a USD 200 mn loan from EBRD to finance combined-cycle gas turbines for a Damanhour power plant;
• Greenlighting upgrades to the National Air Navigation Services Company’s navigation systems;
• Rolling the Mabara Hospital in Alexandria into the General Organization for Teaching Hospitals and Institutes;
• Preliminarily agreeing to allow the ICT Ministry to participate in forming a joint stock company to build technological zones;
• Amending the code of criminal procedure;
• Increasing the budget for education to EGP 5 bn.

A bomb struck an armored vehicle in Al Arish yesterday, killing one army colonel and three soldiers and injuring 12 others, several critically, according to the AP. As of yet, no one has claimed the attacks.

Egypt’s military says an F-16 crashed during a training drill, killing its entire crew, Arabic Sputnik reports. The statement did not specify whether the aircraft was a one- or two-seat variant. Security sources in Ismailia said the plane crashed due to a technical failure.

Is the Zika virus the trigger of the zombie apocalypse? The WHO expects all but two countries (Canada and Chile) in the Americas to be affected by the Zika virus. Just yesterday the first known case of the Zika virus was discovered in California — a woman returning from El Salvador, writes the LA Times. The mosquito-borne virus has already affected over 1 mn people in Brazil and has been found in 21 countries in the continents. While at worst the virus bears similar symptoms to the flu (fever, headache, body aches, a rash), there is mounting evidence that it can harm fetuses after a number of women who contracted the virus in Brazil last year gave birth to babies with microcephaly, a condition that prevents babies’ heads from fully developing. Already, airlines are beginning to refund passengers, particularly pregnant ones, with flights to Central and South America, according to CNN. Currently there is no vaccine or cure for Zika, with health officials advising women in countries with outbreaks to delay pregnancy.

Qatar-based Al Jazeera has formally launched an international arbitration claim seeking damages of more than USD 150 mn from Egypt caused by what it says was the shuttering of its business in the country and the harassment of its journalists, the Guardian reports. The claim is being lodged under the jurisdiction of the International Centre for Settlement of Investment Disputes in Washington. In April 2014, the network served a formal notice of dispute, citing breaches of the 1999 Qatar-Egypt bilateral investment treaty, according to a statement (pdf) from law firm Carter-Ruck. Al Jazeera’s license to broadcast was revoked and three of its journalists were sentenced to seven years in prison in August 2015, only to be released or pardoned a month later.

Cabinet shuffle in Qatar sees new foreign, defense ministers: Qatar’s Emir appointed Sheikh Mohammed bin Abdulrahman Al Thani as foreign minister, replacing Khalid Al Attiyah, who will become state minister for defence affairs. “The decree also merged several ministries, including communication and transport and culture, youth and sports. The public health minister was also replaced,” Reuters said.

THE MACRO PICTURE

Wall Street took a tumble yesterday after the U.S. Federal reserve announced it was keeping rates unchanged. Investors had hoped for a stronger signal that the Fed was going to scale back future hikes. “It sounds like they are unimpressed with what has happened in the markets, that it has been insufficient to change their plans,” Bloomberg quotes CIO Stephen Massocca of Wedbush Equity Management as saying. “They want to see if everything in the global economy and financial markets is really going to bleed through and affect inflation and their outlook for the economy,” Ryan Sweet, a senior economist at Moody’s tells Bloomberg.

The Fed promised it was “closely monitoring” (pdf) global economic developments, including tumbling commodity prices and fears of slower economic growth in China. In that light, IMF and World Bank officials are heading to Azerbaijan to discuss a possible USD 4 bn emergency loan package that looks like the first in a series of bailouts due to sinking oil prices, according to the Financial Times (paywall). As for China, take a look at why the Wall Street Journal’s (paywall) Greg Ip thinks maybe volatility is a good thing. “Volatility raises awareness or risk, something that can actually enhance safety, and not just in finance.”
And if you won’t believe any of the experts about just how bad it is out there, let Apple’s Tim Cook put the last nail in that coffin: “We’re seeing extreme conditions unlike anything we’ve experienced before just about everywhere we look.”

SPOTLIGHT on the auto industry

The law of unintended consequences: Car importers are now requiring that dealers pay them in USD, Al Mal claims. The move is in response to the CBE’s tightening restrictions on imports and the requirement of a 100% cash cover. An anonymous source says the next few months could see a number of European car brands exit the market as their business struggles with long waiting lists.

Meanwhile, the Egyptian Auto Feeders Association criticized the central bank’s decision on Tuesday to ease the cap on USD deposits, with EAFA head Ali Tawfik saying that under the previous system, the central bank would ensure the exchange of EGP to USD deposits. He adds that the CBE has made no such assurance following the decision to ease the deposit cap. Furthermore, the decision will lead to a sharp rise in demand for USD and a spike in parallel market exchange rates, factors that will exacerbate the FX crunch.

Next up in the litany of complaints: The Federation of Egyptian Industry’s Transport Division says new CBE regulations prohibiting banks from extending loans with monthly installments exceeding 35% of a borrower’s net income will cause car sales to plummet. Some 40% of car sales are dependent on retail loans, says division head Adel Badeer.

The Consumer Protection Agency (CPA) will meet with auto importers in early February, Al Mal reports, saying talks will focus on barriers to imports.  While the FX liquidity shortage will top discussions, one of the leading obstacles is the Customs Authority’s government-guided prices meant to guard against alleged price gouging by auto dealers. Another major topic will be the new standards and quality-control measures imposed on imports by the Trade Ministry in 2014. The CPA is urging auto industry leaders and companies to participate in the meeting, which will include the Trade Ministry, the CBE, the Customs Authority, the General Organization for Export and Import Control, the Egyptian Organization for Standardization & Quality Control and the National Association of Manufacturers.

EGYPT IN THE NEWS

Culture ministry cancels planned screening of Israeli film ‘The Band’s Visit’ in Beni Suef: We’re not sure why or how this was arranged in the first place, but a cultural institution in Beni Suef scheduled a screening of the 2007 Israeli film ‘The Band’s Visit,’ before the ministry of culture promptly learned of the event and cancelled it before it could take place, reported Israeli newspaper Haaretz (paywall).

Movie synopsis and review- The Band’s Visit: The comedy centers on the fictitious Alexandria Ceremonial Police Orchestra on their way to a performance at an Arab cultural center in Israel. The troupe take the wrong bus due to a mispronunciation of their destination “Petah Tikva,” as there is no native “p” sound in Arabic, and end up in a desert town with no hotels and no buses leaving, and instead spend the night at the homes of some of the local Israelis. The film treats its Egyptian subjects with a fair amount of respect, and tells the story through the lens of Israelis who have only ever known Egypt through its movie classics broadcast on Israeli state television, a phenomenon we noted in the Worth Reading section of one of our previous issues. The film’s romanticism is actually directly inspired by Egyptian cinema, only to be occasionally interrupted by the ugliness of modern life.

The film is slightly off-putting to watch from an Egyptian perspective, however, as none of the actors are able to pull off the Egyptian dialect except for Palestinian actor Saleh Bakri, with the rest of the Egyptian characters being portrayed by Mizrahi Jews. Of course, this is to be expected, as no Egyptian is going to star in an Israeli film. Egyptian actor Amr Waked received an enormous amount of flack for simply appearing in an American film alongside an Israeli actor and was accused of promoting normalization. But it could be argued the film’s failure to truly and accurately represent Egyptians is also the essence of its message: the characters are forced to speak to each other in English over a lack of knowledge of each other’s’ languages, the younger Israelis know nothing of Egyptian culture, and their older counterparts only know of it through classic Egyptian cinema.

Human Rights Watch issued its World Report 2016 (pdf) yesterday in which it says, “The past two years show that the authorities’ heavy-handed response has only led to more division,” according to Nadim Houry, deputy Middle East director. It seems apt then that the The New York Times’ Amina Ismail and Declan Walsh publish a rather vivid piece about the troubling cases of forced disappearances in Egypt. “Nasser Amin, a lawyer with the state-funded National Council on Human Rights, said the situation was far more stark now than during the nearly three-decade rule of President Hosni Mubarak.” The piece goes on to interview several of those detained then released — one only 15 years old.

WORTH WATCHING

This is Spinal Tap – Album reviews. (Watch, running time: 46 seconds)

DIPLOMACY + FOREIGN TRADE

The Trade Ministry is expected to sign the Egyptian-Russian-Emirates fund agreement during the second Egyptian-Russian Forum with both Russia’s Trade Minister and UAE State Minister Sultan Al Jaber, government sources tell Al Mal. The fund is expected to help finance trade development between the three countries and will set the inclusion of Russian goods, services or partnership as a condition for funding projects, the sources add. The ministry is also preparing a list of investment projects to be featured at the forum, which a delegation of 100 Russian companies is expected to attend.

The Trade Ministry’s Industrial Modernization Center (IMC) has set up a three-year plan to boost exports. The strategy will include supporting and guiding the private sector in opening export markets, establishing an export services center, networking exporters and foreign customers and increasing the number of exhibits to market Egyptian goods. The IMC will also establish an exporter database, which will include registered exporters and their markets, Al Borsa reports.

Did the president promise arms to Iraq? President Abdel Fattah El Sisi promised to provide arms and training to the Iraqi military to aid in its fight against Daesh during his meeting with Iraq’s Defense Minister Khaled El Obeidy, said Iraqi army spokesperson Noseir Noury, who called in to CBC Extra’s “Masr El Arab” program, according to Al Masry Al Youm. The president apparently urged further military and intelligence cooperation between the two countries, Noury added. The story received widespread circulation in the local media, but has not made the rounds in Iraqi media.

ENERGY

BG Group joins operations in Cyprus’ block 12
BG joined operations in block 12 of Cyprus’ offshore block on Wednesday, Energy Minister Giorgos Lakkotrypis says, according to Cyprus Mail. This follows the approval of BG Group’s acquisition of 35% of the block, which is operated by Noble Energy and includes Delek and Avner Oil as partners. Lakkotrypis also spoke about “cooperation and negotiation with countries such as Egypt, Israel and Lebanon,” noting that maximizing natural gas in Cyprus will require “exporting to Egypt for international consumption or for further export.” (Read)

EETC to issue cable tender in Egyptian-Saudi grid interconnection project
The Egyptian Electricity Transmission Company (EETC) will issue a tender next month to install cables linking the Egyptian and Saudi power grids, according to sources within the Electricity Ministry. A Saudi delegation is set to arrive in Egypt to discuss the technical aspects of the tender, which is comprised of three parts. EETC will handle the cables while Saudi Arabia is in charge of the transformer stations. Seven companies have offered to complete the project before the tender is issued, including Kalpataru, Jyoti and KIS Group. (Read in Arabic)

INFRASTRUCTURE

First four roads of National Roads Project operational within days, says transport minister
The Transport Ministry will complete the first four roads of the National Roads Project at the end of this month or the start of next at the latest, says Transport Minister Saad El Geyoushi. The roads in question are El Shat–Eyoun Moussa, Suhag–Red Sea, Menya–Ras Ghareb and the Middle Ring Road. The Wadi El Natroun–Alamein Road was also scheduled to be operational but was delayed due to rainfall, El Geyoushi adds. Most of the roads will be complete by 30 June, he says, adding that the entirety of the National Roads Project should be complete by December 2016. (Read in Arabic)

BASIC MATERIALS + COMMODITIES

GASC to issue rice tender, accuses domestic traders of hoarding
The General Authority for Supply Commodities (GASC) is accusing suppliers of not importing enough rice and domestic traders of hoarding large quantities of it. “We have confirmed reports that some domestic-rice traders are hoarding large quantities to increase prices,” GASC’s deputy head says. GASC will resort to importing rice through an international tender to cover domestic needs, he adds. (Read in Arabic)

MANUFACTURING

Gov’t to issue 14 new cement licenses for coal-powered plants
The government will issue 14 new cement licenses for coal-powered plants that meet environmental regulations, says Trade and Industry Minister Tarek Kabil. The licenses will be for factories in Upper Egypt and other outlying governorates, he adds. (Read in Arabic)

HEALTH + EDUCATION

Saudi Arabia allocates USD 250 mn to build Salman University in Sinai
Saudi Arabia has allocated a USD 250 mn facilitated loan, out of the total USD 750 mn surveyed to develop Sinai, to build the King Salman University, government sources tell Amwal Al Ghad. The Education Ministry was hoping to receive a grant (not a loan) but were unable to because of grant clauses specifying the project had to be built by Saudi contractors, the source adds. The university will feature around 10 faculties, some in Sharm El Sheikh and others in Ras Sedr, and research center o0f international standards serving the university and Health Ministry. Saudi Arabia has USD 110 mn in emergency funding than can be used to expand projects. (Read in Arabic)

REAL ESTATE + HOUSING

Housing Ministry inks MoU with CREC to build Olympic Park, six gov’t buildings in administrative capital
The Housing Ministry signed an MoU with China Railway Engineering Corporation to build Olympic Park and six ministerial buildings, says Housing Minister Mostafa Madbouly. The announcement comes just two days after Mohamed Alabbar announced Capital City Partners would not be part of the new administrative capital project. Olympic Park will be built over an area of 2,000 feddans over a period of 30 months with the state financing 15% of the project, says Madbouly. (Read in Arabic)

TOURISM

Social insurance charges threaten tourism sector
The Economic Committee at the Egyptian Tourism Federation has called for an emergency meeting with Social Solidarity Minister Ghada Wali following charges pressed against tourism-establishment owners by the Public Authority for Social Insurance. The owners were unable to meet social insurance installments following the Metrojet incident, says Adel El Haggar, the head of the committee. The charges threaten the owners with jail time, with no possibility for reconciliation without financial settlement, despite President Abdel Fattah El Sisi’s directive to lighten the burden on the tourism sector. While the CBE has exempted tourism establishments from debt and utility obligations, no similar exemption was issued for social insurance payments. (Read in Arabic)

TELECOMS + ICT

Integrated Technology Systems in competition over EGP 4 bn in ICT projects
Integrated Technology Systems (I-Techs) is looking to compete over ICT infrastructure projects on a PPP basis with an investment value of EGP 4 bn, CEO Mokbil Fayad tells Al Mal. The projects include the EGP 1.2 bn endeavor to upgrade 88 commercial registration offices and the EGP 750 mn project to upgrade 400 real estate documentation offices.  I-Techs heads a consortium of nine companies under the name United Technology Group, adds Fayad. (Read in Arabic)

EGP 8 bn in expected returns from launching 4G service, says former ICT minister
“Launching 4G services will provide the state with about EGP 8 bn from fees of licenses,”
says former ICT Minister Khaled Negm in his first remarks since leaving office. Telecommunication infrastructure needs to be further developed and provided at a fair price to allow mobile operators and ISPs to provide high quality services at favorable prices, he adds. This can be attained through cooperation between the NTRA and sovereign bodies to provide more frequency ranges, he adds. (Read)

BANKING + FINANCE

IFC extends USD 75 mn line to NBK’s Egypt operation for SMEs, renewables, trade finance
The International Finance Corporation (IFC) has granted the National Bank of Kuwait-Egypt (NBK) a five-year, USD 75 mn line of credit divided into three tranches of USD 25 mn each. The credit line is to finance SMEs, renewable energy projects and international trade, says NBK Egypt Managing Director Yasser Hassan. The IFC also granted NBK Egypt a separate USD 25 mn loan as part of its international program to finance international trade, says Marcos Brujis, Global Industry Director of Financial Institutions Group. (Read in Arabic)

EGYPT POLITICS + ECONOMICS

Gov’t negotiates with Abu Dhabi sovereign wealth funds
The government is currently negotiating with sovereign wealth funds (SWF) including the Abu Dhabi Investment Company and the Abu Dhabi Council for Economic Development (ADCED) to buy USD treasury bonds, with talks spearheaded by Investment Minister Ashraf Salman and CBE Governor Tarek Amer during a visit to Abu Dhabi, sources tell Al Masry Al Youm. Salman informed ADCED senior executives that the CBE was taking measures to revitalize the secondary bond market. Egypt has taken steps to launch its own SWFs and a private equity firm, Amlak. (Read in Arabic)

EBA, FEI reject new Labor Act
The Egyptian Businessmen’s Association (EBA), the Federation of Egyptian Industries (FEI) and other prominent business associations have rejected the new Labor Act and expressed their opposition to the Manpower Minister due to what they believe are restrictions on business owners’ “rights” in favor of workers, according to Al Mal. Some of the articles undermine owners’ authority, such as Article 69, which prevents the firing of a worker without a judicial appeals process, said Mahmoud Fahmy who chairs the EBA’s Legislative Committee. The FEI called for the formation of a committee to resolve the issues before the draft legislation is put to parliament for a vote. The act, which grants workers more rights and benefits, including a 10% bonus for private sector workers, was rejected by the Federation of Egyptian Chambers of Commerce back in September.

Wheat subsidy program under increasing House scrutiny
MP Hisham El Hasry plans to launch a parliamentary inquiry on the decision to purchase wheat from farmers at the global average price and will call the Agriculture Minister to a parliamentary hearing on the policy, which he states does not cover farmers’ costs. The Supply Minister announced on Tuesday that the policy had been suspended after the House voted it down. (Read in Arabic)

Gov’t has yet to determine which law will set payment of bureaucrat salaries
State bureaucrat salaries and pensions for February will be paid, but it is unknown under which legislative framework, says Khaled Zakaria, member of the Planning Ministry’s Administrative Reform Committee. He states that the ministry plans to address parliament’s concerns on the Civil Service Act and is waiting for the House to nominate members to a committee to help work on amendments. (Read in Arabic)

Seven new House committees formed
The House Parliamentary Affairs Committee voted to raise the number of committees in the House to 26 from 19 as part of the new executive regulations governing the House and its functions. The seven new committees include committees on SMEs, culture and media, African affairs, ICT, anti-corruption, higher education and social affairs. The Parliamentary Affairs Committee also kept executive regulations that ban the media from attending closed committee meetings. (Read in Arabic)

SPORTS

Egypt’s winning run in African Cup continues
Egypt’s winning streak in the Handball African Cup of Nations continued with a 31-13 win against Morocco in the final game of the group stage on Tuesday. Egypt qualified for the knock-out stages and will face Congo in the quarter finals, winning 39-18. Egypt is set to play against Angola on Friday in the semi finals. The tournament is particularly important as its winner will reach the summer Olympic Games in Rio de Janeiro while the top three will qualify for next year’s World Championship in France. (Read)

ON YOUR WAY OUT

Egypt was ranked #88 in Transparency International’s Corruption Perception Index 2015. Egypt scored 36 points on a score gradient indicating the perceived level of public sector corruption on a scale of 0 (highly corrupt) to 100 (very clean). Egyptian security forces had apparently shut down a press conference by the Transparency and Integrity Institute announcing the index, Al Shorouk cites the organization’s Haggag Nael as saying.

Cairo Metro ticket prices are set to increase to EGP 2, a Transport Ministry spokesperson tells Amwal Al Ghad. The decision awaits parliamentary approval, he adds.

Operations in the ports of Alexandria and Dekheila resumed yesterday after having been shut down for five days due to poor weather conditions, Al Borsa reports.

Fatma Naoot has submitted an appeal against her three-year prison sentence, Al Masry Al Youm reports.

Egypt has been receiving sizeable loans recently, but at what cost down the line? Financial writer Patrick Werr says we’re “simply kicking problems down the road” in a piece for The National. The most recent bundle of loans came in the form of 21 agreements and MoUs signed during Chinese President Xi Jinping’s visit. “But since a significant chunk of the package will be used to import Chinese labour and construction materials, only part of it will translate into an immediate economic stimulus. There will be a price to be paid in terms of long-term debt.” And with a budget deficit at 12.5% of GDP, it looks like the latest financial pledges won’t be enough to plug the gap. Significant austerity measures are needed, Werr says, to stave off problems down the line.