Good morning, wonderful people, and welcome to Day Five of this unexpected March heatwave. Grab your shades, your sunblock, and your swimsuits, and head out for a nice pool day while you can.

Enterprise Weekend comes out each Friday at 9:00am CLT. We’ll be back on Sunday at 6am with EnterpriseAM. Until then: Enjoy the weekend.

LAST WEEK IN 3 MINS-

It was a mixed bag of nuts in the news this week, with plenty of diplo and investment updates to keep us busy — and some not-so-good news for our public purse and projected inflation.

We made some progress in our quest for investment, but no breakthroughs: Prime Minister Moustafa Madbouly led a delegation of cabinet ministers and other officials on a two-day visit to Qatar this week to discuss the Gulf country’s plans to invest in Egypt. The message to the Qataris: Egypt is well on its way out of an economic and FX crisis — and we’re willing to listen to your ideas if it opens the door to fresh investment. Some action points out of the visit:

• An Egyptian-Qatari investment fund with “large paid in-capital” is in the works;
• Three Qatari conglomerates — Investment Holding Group, Al Qamra Holding Group, and Aamal Company — could eventually invest in our healthcare sector under three separate MoUs;
• A customs agreement could be signed soon, following a dual taxation agreement the two sides signed to scrap double taxation and crack down on tax evasion.

REMEMBER- Doha last year pledged to invest USD 5 bn to help Egypt shore up its external position following Russia’s invasion of Ukraine, but is yet to pull the trigger on any major investments, including the acquisition of a stake in Vodafone Egypt and two container terminal operators. Disputes reportedly revolve around the sizes of the stakes.

ANOTHER BIG DIPLO MOMENT- Foreign Minister Sameh Shoukry became the first Egyptian diplomat to make official visits to Syria and Turkey in a decade after he flew to the two earthquake-hit countries for talks with Syrian President Bashar Al Assad and Turkish Foreign Minister Mevlut Cavusoglu.

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ON THE ECON SIDE OF THINGS-

The EGP devaluation and rising rates lead gov’t to project a miss of our deficit + debt-to-GDP forecasts for FY 2022-2023: The Finance Ministry now expects the budget deficit to rise to 6.8% of GDP this year, rather than 6.1%, and debt-to-GDP ratio to increase to 93%, up from an earlier 84% target.

The government hiked fuel prices, with petrol rising 7-11% (95-octane fuel will now cost you EGP 11.50 per liter) and the cost of mazut increasing by 20% for most buyers. The hike is expected to drive inflation up over the next few months.

ALSO- The ongoing FX shortage + import restrictions continued to lead headlines: Auto sales fell once again in January amid the ongoing FX crunch and import restrictions, while some banks were reported to have halted L/Cs and documentary collection.

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AS FOR INVESTMENT- We had a flurry of fresh news:

• Egypt, the UAE, Jordan and Bahrain signed agreements to establish nine joint industrial projects at an investment cost of USD 2 bn, as part of the regional industrial partnership set up last year;
• Egypt Kuwait Holding also pledged to invest some USD 170 mn in the Egyptian market in 2023.
• The Egyptian-American Enterprise Fund (EAEF) plans to reinvest around USD 20-50 mn from the proceeds of its sale of a stake in local snackmaker Auf Group in local businesses and funds this year, and hopes to deploy up to USD 100 mn in total within the next two to three years.

It was a quiet week on the M&A front, with just two stories of note: The board of EGX-listed Edita Food Industries agreed to submit a bid to acquire 100% of an unnamed, unlisted company in the local food industry. Meanwhile, e-Finance is reportedly in advanced talks with a local strategic investor looking to buy into an EGP 2.5 bn capital increase for one of its subsidiaries.

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WHAT’S HAPPENING NEXT WEEK-

We’re getting plenty of updated economic indicators next week, including:

• The PMI, out on Sunday: We’ll be waiting to see how Egypt’s non-oil private sector performed in February, after activity in the sector contracted for the 26th consecutive month in January on the back of persistent inflation and the FX shortage. We hope that the impact of import restrictions getting scrapped may have started filtering through to businesses, which could potentially see the index contract at a slower pace.
• Inflation figures, out EOW: Inflation — which hit a fresh five-year-high in January — is likely to have risen further, as factors like the devaluation and heightened demand ahead of Ramadan drive prices up.
• Foreign reserves: Reserves have been on a gentle upward slope the past five months and are now up by more than USD 1 bn since the end of August. Reserves fell 20% last spring on the back of the war in Ukraine and tightening financial conditions globally.

ALSO- Our friends at EFG Hermes Holding are hosting their annual One on One investor conference in Dubai next week. It’s the largest frontier and emerging markets investor conference globally.

Stay tuned for our coverage of the event, which gathers global investors as well as CEOs, C-suite execs and IR folks from hundreds of global companies to get insights on their appetite and their economic forecasts for the year ahead.

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

???? YOUR MOST CLICKED LINKS-

• We’re very happy to report that a lot of you were interested in our exports + FDI event. (Registration page)
• We were also delighted to see continued interest in our Enterprise Guide on the kinds of cars you can actually buy right now. (Enterprise)
• Some of you seem interested in applying to the LSE-Sawiris Scholarship Program, judging by the number of people who wanted to know more about the info session that was held for the program last week. (Registration page)
• A lot of you wanted to know where Societe Generale sees the EGP heading. (Bloomberg)
• Some of you seem to have your eyes on Chinese automaker Dongfeng’s E70 500 Pro electric vehicles, which just launched in the Egyptian market. (pdf)

???? AROUND THE WORLD IN SEVEN DAYS-

Most eyes were on Russia and Ukraine this past week as we hit the one-year mark for the war, with coverage on the Saudi foreign minister’s surprise visit to Kyiv, Washington’s latest warning to Beijing against providing arms to Russia and the ways the war has impacted the European continent getting top billing.

Also getting attention: Nigeria’s ruling party candidate Bola Tinubu is now the country’s president-elect following disputed elections. Over in the UK, a post-Brexit Northern Ireland trade agreement struck by the government and the EU got significant attention.

And Microsoft’s still shoving its AI-powered Bing down our throats, despite all the threats its alter ego (Sydney? Venom?) has posed to users. The tech giant said it plans to roll the upgraded search engine out to its Windows operating system.

☀️ THE WEATHER THIS WEEKEND- It’s pool day weather: Temperatures are going to hit 34°C today and 31°C tomorrow. Don’t forget to keep a jacket on hand though — the mercury will drop at night to lows of 12-13°C.