Monday, 12 July 2021

EnterprisePM — Canada’s B2Gold and Sukkari operator Centamin scored four more gold licences today.

TL;DR

WHAT WE’RE TRACKING TONIGHT

The pre-Eid news slowdown appears to be in full effect, with not one major theme in business happening today. For those who have not set an internal countdown, Monday, 19 July is the Wa’fa.

THE BIG STORY TODAY- The Oil Ministry signed four gold exploration contracts worth USD 17 mn with Canada’s B2Gold and Australian gold miner and Sukkari operator Centamin. The local press had reported yesterday that Canada’s Barrick Gold was also expected to sign an agreement today, but that does not appear to have taken place. We breakdown who gets what in the Speed Round below.

HAPPENING NOW- The House of Representatives have given their sign off on a number of political and administrative pieces of legislation today as it trudges ahead before its summer recess. There is an expectation that they will sign off on the long awaited Water Resources Act today. We’ll be keeping an eye on it and will have the full rundown in tomorrow’s EnterpriseAM.

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

  • More than 2.25 mn vaccines will be delivered to Egypt this week, among them Pfizer, AstraZeneca, and Johnson & Johnson jabs.
  • Egypt’s external debt jumped by 21% in 3Q2020-2021 to USD 134.8 bn, compared to USD 111.3 bn in the same period in the previous fiscal year, according to the CBE.
  • Suez Canal revenues hit a record USD 5.84 bn in FY2020-2021, despite the Ever Given debacle that took place earlier this year.

When will we know the price of fuel at the pump for 3Q2021? The government’s fuel pricing committee, which will set prices for domestic fuel for the current quarter, was supposed to have concluded their meetings last Saturday. A decision may not be announced until the beginning of August, government officials reportedly told the local press. The meeting comes as OPEC+ has failed to reach a supply agreement, which is meant to help keep global inflation under wraps.

Globally, oil prices appear to have slipped last Friday, with futures ending the day at USD 74/bbl. Analysts speaking to Bloomberg suggest that weaker demand from China and the Delta variant threatening recovery in Europe as the likely reason.

THE BIG STORY ABROAD– Two former Jordanian officials have been sentenced to 15 years in prison on sedition and incitement charges after an alleged coup against Jordan’s King Abdullah II that took place in April. Bassem Awadallah, who served as a top aide to the monarch, and Sharif Hassan bin Zaid, a member of the royal family, are being accused of conspiring with Prince Hamzah, the king’s half-brother. The two men have denied the charges and are planning to appeal. Covering the story are Reuters | Bloomberg | The Associated Press | Deutsche Welle.

🗓 CIRCLE YOUR CALENDAR-

You have three more days to visit the Cairo International Book Fair at the Egypt International Exhibition Center. The event will run through 15 July and the fair’s committee has now allowed the exhibition ground to operate at 70% capacity.

The Clean Energy Business Council’s webinar Women Entrepreneurs in Canada and the Middle East is taking place on 21 July at 3pm, showcasing female entrepreneurs working in climate tech in the two regions, and highlighting the challenges they face.

🚙 FOR YOUR COMMUTE-

Yes, we would like flying cars to be quieter before they’re allowed on our skies, thank you: Entrepreneurs, including former NASA engineer Mark Moore, are working on how to make the long-dreamed-of flying car quieter. Whisper Aero is designing flying taxis that are quieter than their normal counterparts, in efforts to reduce noise pollution. A Bloomberg piece notes how a buzzing drone can ruin a perfectly good day at the beach, and hundreds of flying cars in the sky are sure to make our daily commutes even more hectic. Whisper’s new “thruster” design will allow the aircrafts to blend into city noise, making a sky full of flying cars, if that is ever our reality, sound a little less annoying.

YOUR MANDATORY COVID STORY- Pfizer is pushing the FDA towards a third dose of its covid jab, and is set to discuss the need for a booster shot in the next 12 months with FDA officials today, the Associated Press reports. Pfizer said last week that a third jab increases people’s antibodies by 5-10 fold, compared to only two shots. The Centers for Disease Control and Prevention and the FDA previously said that there is no need for a third dose, but didn’t rule out the possibility either.

📺 ON THE TUBE TONIGHT-

Saudi animation comedy Masameer County offers a humorous view on a changing Saudi Arabia: In the eight-episode exclusive series, the Masameer Gang get stuck in the middle of a tribal feud, while also instigating a global media war. The series is refreshingly Arab-inspired and depicts a reality we can all relate to, especially the eccentric group of friends aspect that we’ve all experienced. Masameer County is a great light look at how the Gulf kingdom operates, mixing comedy with politics and societal issues.

Football comes to Rome: Italy emerged as yesterday’s victor in the Euro 2020 finals, beating England in a penalty shootout after a match that we thought felt more like a WWE showdown. The two teams were tied at 1-1, with England’s Luke Shaw scoring a goal in the first two minutes before Leonardo Bonucci brought Italy back into the game with a goal in minute 67.

🎤 OUT AND ABOUT-

Fusion band Code Masr is performing at The Room New Cairo tonight at 9pm.

A spike ball and archery event is taking place tomorrow at 6pm at the Bison courts in New Cairo’s Metropolitan school. Professional trainers will be available to teach and supervise the sports.

7 Rays Holistic Health Center & Community is hosting a movie night today at 6pm, showing the Egyptian movie X-Large, after which Nour Mehanna will lead a discussion on the film from a yoga perspective.

💡 UNDER THE LAMPLIGHT-

The foreign press has been all over it, maybe you should give it a read too: Midnight in Cairo by Raphael Cormack paints a picture of Egypt’s Roaring Twenties, a time that redefined Egyptian popular culture by putting female singers and dancers front and center. From Badia Masabni’s dancehall to Egyptian cinema pioneer Aziza Amir to legendary singer Umm Kulthum, these divas thrust themselves into the political and sociological spheres and had a massive impact on what it meant to be Egyptian at the time. They also paved the way for later feminist battles by breaking with patriarchial gender norms and striking out on their own to create businesses, careers, and public personas in a maligned and controversial industry for women at the time.

You can read more reviews on: The Financial Times | Al Monitor | Harper’s Bazaar | The Times | The Wall Street Journal | The Guardian.

☀️ TOMORROW’S WEATHER- Surprise surprise, 40°C weather once again for the capital city, with temperatures falling to 23°C at night, our favorite weather app tells us. Meanwhile, the mercury is at 32°C in Sahel, with nighttime lows of 22°C.

SPEED ROUND: MINING

Four more gold licenses signed for today

The government signed today four new gold exploration contracts with Canadian miner B2Gold and Australian gold miner and Sukkari operator Centamin, with investments exceeding USD 17 mn, the Oil Ministry said in a statement.

Who gets what? B2Gold was granted the rights for six gold exploration blocks under a USD 8 mn contract, while Centamin was awarded the remaining three contracts, valued at USD 9.1 mn, for gold search in 19 blocks, according to the statement. The agreements come under last year’s Oil Ministry tender, which awarded 11 mining companies the rights for 82 gold exploration blocks in the Eastern Desert last November.

Who signed so far? Four mining companies signed 10 new gold exploration contracts worth a combined USD 11 mn with the Oil Ministry in February. These include Sawiris-backed Akh Gold, Red Sea Resources, the North Africa Mining and Petroleum Company, and Al Abadi Mining. A month earlier, Canadian miner Lotus Gold and local firms Mining and Manufacturing Company and Ebdaa Gold Mining also inked their agreements. All remaining contracts for gold exploration concessions were expected to be signed by the end of February.

SPEED ROUND: EDUCATION

Egypt Education Platform coming to Soma Bay

The Egypt Education Platform (EEP) signed an MoU with Abu Soma Development (ASD) to develop and operate a school in Soma Bay under the GEMS International Schools brand, according to a press release (pdf). The cooperation comes as ASD aims to elevate Soma Bay as a permanent fully-integrated residential community by offering high-quality educational institutions in the Red Sea governorate, ASD CEO Ibrahim El Missiri said.

The Soma Bay school is expected to open its doors in September 2023 with a capacity for 600 students.

The GEMS brand has been expanding lately, most recently signing an MoU with the Sovereign Fund of Egypt to build and operate two national schools in West Cairo on SFE-owned land. “We are committed to our expansion plan ensuring we touch the lives of many families across Egypt, via providing a world-class education service,” commented EEP CEO Ahmed Wahby.

The EEP — which includes GEMS, EFG Hermes, and the SFE — has several educational brands under its umbrella with two more to be launched soon. These include GEMS International Schools, Prime National Schools, Hayah Schools Enterprise.

SPEED ROUND: STARTUP WATCH

Yodawy lands USD 7.5 mn in a series B funding round

Yodawy raises USD 7.5 mn in a Algebra, MEVP, Global Ventures-led series B funding: Pharma platform Yodawy has landed USD 7.5 mn in a series B funding round led by Algebra Ventures, Beirut-based Middle East Venture Partners (MEVP) and UAE-based venture capital fund Global Ventures, according to an emailed statement (pdf). CIB’s VC arm CVentures, P1 Ventures and Saudi-based Athaal Angel Investors Group also participated in the round. The online pharma e-commerce market plans to use the funding to roll out new offerings to its network of pharmacies, patients and health ins. providers “and expand into the other key emerging markets,” according to the statement.

About Yodawy: The Egypt-based company, about three years old now, is a pharma delivery app with a built-in AI ins. approval engine and a digitized prescription tool. With a six-figure number of orders completed, Yodawy also built its own partners and pharmacy portal to facilitate order processing methods. Yodawy successfully raised USD 1 mn in funding so far, and has partnered with over 2k pharmacies across the country. This year, the startup is looking to expand regionally, as well as grow its partnerships with leading ins. Players.

MICROFINANCE

Tasaheel receives first SME microfinancing license

Tasaheel received the first SMEs microfinancing license approved by the Financial Regulatory Authority (FRA), according to an FRA statement (pdf). This is the first company in the non-banking sector to be able to finance SME activities under the Microfinancing Act. Tasaheel will now be able to offer micro loans to small and medium enterprises, instead of just micro enterprises. Separately, Tasaheel had requested a nano financing license earlier in 2020 from the FRA.

Who else could be up? Microfinance player Tamweely is also looking to provide micro leasing products to SMEs early 2022, once it receives sign-off from the Financial Regulatory Authority, CEO Ahmed Khorshid reportedly told the local press back in April.

GO WITH THE FLOW

Regional investors net buyers in trading today

The EGX30 rose 0.8% at today’s close on turnover of EGP 1.19 bn (2.1% below the 90-day average). Regional investors were net buyers. The index is down 5.6% YTD.

In the green: EFG Hermes (+3.3%), Telecom Egypt (+2.8%) and Orascom Financial Holding (+2.1%).

In the red: Palm Hills Development (-2.7%), Export Development Bank of Egypt (-1.3%) and MM Group (-1.1%).

WHAT’S NEXT

Swimming in regulatory uncertainty: DeFi – Part I

With regulators' eyes fixed on the potential harms of an unregulated crypto sector, could DeFi be the next frontier for regulation? After the UK banned operations by crypto exchange Binance last month over concerns over loose regulation and high risk for retail investors, decentralized finance could be the next big headache for regulators. A sign of their growing concern: Reps of automated crypto exchanges such as Uniswap and other players in the fast-growing sector met virtually with the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission to bring them up to speed on developments in the decentralized finance (DeFi) space, the Financial Times reported. The event came on the heels of a global regulatory crackdown on crypto, though DeFi has so far avoided coming under the same harsh spotlight.

What exactly is DeFi? DeFi is an umbrella term for a raft of financial applications in cryptocurrency (mainly stablecoins), geared towards disrupting financial intermediaries and facilitating peer-to-peer transactions. Blockchains — typically Ethereum — are used in DeFi to create “smart contracts,” through which users can manage financial transactions such as lending, borrowing and trading outside the purview of traditional financial institutions such banks, brokerage firms and centralized exchanges.

So how does it work? Users interact with DeFi software protocols through unhosted wallets — non-custodial digital wallets that allow users to store their assets without having to depend on third-parties. The first DeFi application was created by MakerDAO, founded by a Dutch entrepreneur in 2014. MakerDAO is a decentralized autonomous organization that created a token pegged to the USD called Dai.

Interest in DeFi is picking up: As this blockchain-based financial infrastructure gains steam, CoinGecko calculated (pdf) the industry’s market cap at more than USD 90 bn as of this month. American entrepreneur Mark Cuban described DeFi as an industry with “the potential to explode” after the monthly volume of decentralized exchanges skyrocketed to USD 45.2 bn in January, from USD 39.5 mn during the same month a year before. The rise in the price of Ethereum, the most commonly used blockchain for DeFi contracts, is also attributed to increased interest in DeFi. In February, Bitwise Asset Management announced the launch of the Bitwise DeFi Crypto Index Fund — the world’s first-ever fund vehicle for accessing DeFi currencies, angling to usurp traditional finance.

So, what’s the problem with DeFi? In a nutshell, it’s decentralized: Unlike traditional banks, which can be sanctioned or shut down, regulators would face difficulty holding any particular person or entity accountable in this all-digital industry. In DeFi, users do not receive risk disclosures, and its open protocols are not subject to risk management requirements, such as capital and liquidity buffers, that protect against loss of consumer funds and other systemic risks. DeFi users may have little recourse should a transaction go foul.

This is further complicated by the fact that blockchain networks operate globally, meaning that participation in DeFi activities would not fall under any particular country’s regulated financial system or tax laws. And when regulatory standards are created for this sector in one country, platforms may gravitate to countries with less strict protocols. The fact that different countries are at varying stages of regulating the crypto sector is also a challenge, with most crypto-related regulatory frameworks in developing economies still relatively lax.

But wait, how is DeFi actually different from good old fashioned crypto trading? Though users of DeFi contracts handle cryptocurrencies, crypto exchanges are considered a form of CeFi, or centralized finance, in the sense that they are still run by centralized entities that match buyers and sellers, and are subject to KYC (know your customer) protocols, and anti money laundering practices. DeFi sidesteps all of this by facilitating trades through its blockchain hosted contracts. Another key difference is that DeFi facilitates the tokenization of real world assets, creating digital units of commodities, shares, or stock indexes.

Present regulation: DeFi does not refer to a predefined financial system or regulatory framework, but those that apply to cryptocurrency projects currently also govern DeFi, though they do not go into specifics. Present regulation assumes the presence of intermediaries in trades, which does not apply to decentralized DeFi digital asset classes. DeFi transactions conducted between individual users through “unhosted wallets” are also not subject to existing regulatory requirements. “The regulators are probably scratching their heads on how to handle [DeFi],” says crypto exchange Binance CEO Changpeng Zhao, “Do they regulate the guys writing code or do they regulate the blockchain? What’s there to regulate?”

Regulation in DeFi transactions could pose a radical challenge to modern finance: In its “Bitcoin’s Dirty Little Secrets” report (pdf) in March, Bank of America analysts wrote that DeFi applications are “potentially more disruptive than bitcoin,” stressing that “nobody reasonably could claim that DeFi has at present been fully stress-tested. How hack-proof would DeFi be if the numbers involved were larger? We simply don't know.”

We’ll explore how regulators around the world are proposing to pull the reins on the DeFi space in part II of our series, in tomorrow’s EnterprisePM.

YOUR HEALTH

Your stress is a great marketing tool

Stress-relief is proving to be a great marketing approach during the pandemic: When the pandemic drove anxiety through the roof worldwide, major companies and brands jumped in with products designed to provide stress relief. Health and well-being has inched up people’s priority list and products that have promised to provide serenity and relaxation now have an even greater appeal. From luxury cars to scents and candles, stress-relief is a new marketing buzzword and shoppers are happy to have their everyday products give them a mental health boost, reports the Wall Street Journal.

Just how stressed are Egyptians? A study published in Community Mental Health Journal aimed to answer that question by surveying 1629 men and women about their level of anxiety and depression during the covid-19 pandemic. Depression was the most cited condition with 67.1% of respondents recording feeling depressed during the past period. Meanwhile, 53.5% reported experiencing anxiety, 48.8% reported stress, and 23.1% of Egyptians said they were sleeping less than six hours a day.

How to combat the stress? Get an orchestra-sound-composed car: US automaker Lincoln is putting stress relief at the forefront of its new Nautilus model, which it describes as a “sanctuary” for riders. Other than the massage-enabled seats, sound-dampening exterior, and vents that emit refreshed air, Lincoln tapped the Detroit Symphony Orchestra to compose soft chimes to play when performing functions in the car. “The door opens and it really feels like a human hug,” says Lincoln’s design director Kemal Curic. (Though the symphonic chimes definitely put a smile on our face (watch, runtime: 02:20), we’re not sure what sort of human hugs Curic has been experiencing if they’re comparable to a car door opening).

Aromatherapy and other ambiance creating products are also making a splash: Scented candles, sprays, and essential oils have been a thing for a while, but our sentimental olfactory system gave companies who sell these products a major boost in sales during the pandemic. Egypt is no stranger to the trend, with brands such as Areej and Nefertari offering scents that help alleviate stress, induce sleep, and increase productivity. Not to mention, they could help protect against covid-19, according to a study that looked at essential oils' antiviral and anti-inflammatory properties.

Even our water intake can be stress relieving: In the US, PepsiCo has been rolling out new products that help consumers unwind, such as their blackberry and lavender flavored water Driftwell for pre-bedtime relaxation. In May, the company also rolled out Soulboost, a sparkling water brand that claims its products can support relaxation, among other things. Here in Umm El Donia, the closest equivalent we can think of is Dasani’s antioxidant water bottle line which helps “protect body cells from damage caused by stress” the label claims.

Other Egyptian products targeted towards the stressed-out:

Our take: While musical cars, nice candles, and fizzy water might not be scientifically sound methods of effectively relieving stress in the long term, it’s always nice to find small things during the day that put a smile on your face or give you a sense of relaxation. That having been said, tacking the words “relax” “zen” or “detoxify” onto an item doesn’t make it a good product, and the prevalence of this trend has us rolling our eyes (as we light our scented candles).

CALENDAR

July: The government’s fuel pricing committee will meet to announce 3Q prices.

14 July (Wednesday): The EGX will hold board elections for the 2021-2025 term.

Mid-July: Legislative session expected to end.

19 July (Monday): Arafat Day (national holiday).

21 July (Wednesday): Clean Energy Business Council’s webinar Women entrepreneurs in clean energy (3pm)

20-23 July (Tuesday-Friday): Eid Al Adha (national holiday).

23 July (Friday): Revolution Day (national holiday).

23 July-11 August (Friday-Wednesday): Tokyo 2020 Olympics.

2-4 August (Monday-Wednesday): Egypt is hosting the Africa Food Manufacturing exhibition at the Egypt International Exhibition Center.

5 August (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

9 August (Monday): Islamic New Year.

12 August (Thursday): National holiday in observance of the Islamic New Year.

3-5 September (Friday-Sunday): The World Karate Federation will hold the third competition of the 2021 Karate 1-Premier League in Cairo.

12-15 September (Sunday-Wednesday): Sahara Expo: the 33rd International Agricultural Exhibition for Africa and the Middle East.

15 September (Wednesday): The CFO Leadership & Strategy Summit is taking place in Egypt.

16 September (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

30 September-2 October (Thursday-Saturday): Egypt Projects 2021 expo, Egypt International Exhibition Center, Cairo, Egypt.

30 September-8 October (Thursday-Friday): The Cairo International Fair, Cairo International Conference Center, Cairo, Egypt.

30 September: Closing of 2021’s first oil and gas tender in the Gulf of Suez, Western Desert, and the Mediterranean.

1 October (Friday): Businesses importing goods at seaports will need to file shipping documents and cargo data digitally to the Advance Cargo Information (ACI) system.

1 October (Friday): Expo 2020 Dubai opens.

6 October (Wednesday): Armed Forces Day.

7 October (Thursday): National holiday in observance of Armed Forces Day.

12-14 October (Tuesday-Thursday): Mediterranean Offshore Conference, Alexandria, Egypt.

18 October (Monday): Prophet’s Birthday.

21 October (Thursday): National holiday in observance of the Prophet’s Birthday.

24-28 October (Sunday-Thursday) Cairo Water Week, Cairo, Egypt.

27-28 October (Wednesday-Thursday) Intelligent Cities Exhibition & Conference, Royal Maxim Palace Kempinski, Cairo, Egypt.

28 October (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

30 October – 4 November (Saturday-Thursday): The first edition of Race The Legends, Egypt.

1-3 November (Monday-Wednesday): Egypt Energy exhibition on power and renewable energy, Egypt International Exhibition Center, Cairo, Egypt.

November: Egypt will host another round of talks to reach a potential Egyptian-Eurasian trade agreement, which can significantly contribute to increasing the volume of Egyptian exports to the Russia-led bloc that includes Armenia, Belarus, Kazakhstan and Kyrgyzstan.

1-12 November (Monday-Friday): 2021 United Nations Climate Change Conference (COP26), Glasgow, United Kingdom.

29 November-2 December (Monday-Thursday): Egypt Defense Expo.

12-14 December (Sunday-Tuesday): Food Africa Cairo trade exhibition, Egypt International Exhibition Center, Cairo, Egypt.

13-17 December: United Nations Convention against Corruption, Sharm El Sheikh, Egypt.

16 December (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

14-16 February 2022 (Monday-Wednesday): Egypt Petroleum Show, Egypt International Exhibition Center, New Cairo, Egypt.

1H2022: The World Economic Forum annual meeting, location TBD.

May 2022: Investment in Logistics Conference, Cairo, Egypt.

27 June-3 July 2022 (Monday-Sunday): World University Squash Championships, New Giza.

**Note to readers: Some national holidays may appear twice above. Since 2020, Egypt has observed most mid-week holidays on Thursdays regardless of the day on which they fall and may also move those days to Sundays. We distinguish below between the actual holiday and its observance.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.