EnterprisePM — No Egyptian has yet made the podium in Tokyo

Corporate Egypt is easing back into the workweek after a long Eid vacation — and the summer news slowdown seems to be in full swing abroad, compounded by this being the opening weekend of the 2020 Tokyo Olympics.

THE BIG STORY of the day here at home: The UAE’s Aldar has another 30 working days to submit a mandatory tender offer to take control of upmarket real estate developer SODIC. We have chapter and vest in this afternoon’s Speed Round, below.

THE BIG STORY ABROAD? It’s a really vanilla news day in the west. The Financial Times is leading with news that SoftBank’s play on China has left it in the red, while the Wall Street Journal is trumpeting that “investors are buying American” after global money managers put more than USD 900 bn into US funds in the first half of the year, a new record.

On the wires: Reuters is leading with an Olympic update, including Tunisia’s Ahmed Hafnaoui taking gold in the men’s 400 mn freestyle swimming event in a victory that “stunned the swimming superpowers.” Bloomberg, meanwhile, thinks we need to keep an eye for “record profits followed by eye-watering dividend payouts” as mining companies start reporting how much they’ve made amid the ongoing global commodities boom.

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

• Fuel prices hiked for second consecutive quarter: Motorists will now pay an extra EGP 0.25 per liter for 95, 92 and 80 octane fuel during 3Q2021 after the government increased fuel prices in response to rising international oil prices.
• FRA approves Bank ABC’s MTO to purchase Blom Bank Egypt: The transaction would see the Gulf lender purchase up to 100% of Blom Egypt at EGP 22.33 a share, valuing the business at USD 427 mn.
• Russian flights to the Red Sea to resume in 2 weeks: Flights between Moscow and Egypt’s Red Sea resorts will resume on 9 August following a six-year hiatus, with five flights to run weekly to Sharm El Sheikh and Hurghada.

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YOUR MANDATORY COVID STORY- The race is on for a covid-19 treatment in pill form: Japan’s Shionogi is developing a once-a-day pill for covid-19, with human trials starting this month and expected to continue into next year, writes the Wall Street Journal. Pfizer and Merck are also developing pills that aim to neutralize the coronavirus.

But there’s a catch: None of them are the so-called “vaccine pill,” which is about to start clinical trials in Israel.

SIGN OF THE TIMES- Trading app Robinhood held an open-to-all roadshow, defying conventions again ahead of its expected Thursday debut on the Nasdaq, according to Bloomberg. The trading app live-streamed its presentation yesterday instead of limiting the event to large institutional investors. The upcoming IPO is also shaping up to be far from traditional, with Robinhood reserving as much as 35% of its shares for traders from its own app in one of the largest retail allocations ever. The current target range for shares is between USD 38-42. The company is seeking to raise about USD 2 bn, and is trading under the ticker HOOD.

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???? CIRCLE YOUR CALENDAR-

The Clean Energy Business Council will host a webinar focused on female entrepreneurs in the MENA renewable energy scene at 3 pm on Wednesday, 28 July.

Egypt will host the Africa Food Manufacturing exhibition at the Egypt International Exhibition Center on 2-4 August.

The Central Bank of Egypt will meet to review interest rates on Thursday, 5 August.

That means it’s more important than usual to keep an eye on the US Federal Reserve this week, which is meeting on Tuesday and Wednesday of this week. CNBC notes that the Fed isn’t expected to take action, but figures odds are good the central bank will mention the possible winding down of its bond program — a development that “could move the markets since the tapering of the central bank’s bond purchases is seen as the first step on the way to interest rate hikes.”

Speaking of the Fed: Pundits are already wondering whether Jay Powell will be reappointed when his term expires in February. The Wall Street Journal suggests that Powell is in line to be reappointed, but suggests “Fed governor Lael Brainard is the most likely candidate to succeed him” if Joe Biden “decides he would prefer his own pick.”

???? FOR YOUR COMMUTE-

SMART POLICY- Make companies pay for the cost of recycling. Egypt’s solid waste problem isn’t simple — and we’re a bit tired of responsibility being piled on the private sector with comparatively few benefits on the other side — but a movement in the United States to force companies that use packaging to pay for the cost of the consumer waste they help produce is definitely worth a read. Go read Maine will make companies pay for recycling. Here’s How it works.

The European Union is proposing the first carbon border levy by 2026 to combat climate change, according to the Financial Times, though exporters to the EU think it could put foreign trade at risk. Russia — Europe’s biggest supplier of oil, coal, rolled steel and aluminium — estimates that the climate tax could cost it USD 7.6 bn. The EU, however, maintains that the policy targets companies rather than countries, calling it an environmental policy tool to push for climate change, rather than a tariff that meddles with international trade.

The Wall Street Journal is killing it with a series that looks at what the EV revolution will mean for the automotive industry, from manufacturing to who’s going to make a buck building and running charging stations. Among the stories worth a moment of your time:

• EV sales are growing faster than are sales in the wider automotive industry, the paper reports, noting that “New plug-in models from Tesla, Ford, VW and others helped to boost demand”;
• Companies (and families) that have spent generations making car parts are scrambling to retool as the world moves to EVs. The “transition is not yet noticeable in showrooms, but industry resources have shifted”;
• Who’s going to make bank running charging infrastructure? Utilities and startups are “joining forces” in the US, but the Journal worries about the chicken-and-egg dilemma — and about stress on existing electricity networks as fast-charging stations build out.

???? ON THE TUBE TONIGHT-

Bankrolled, a Mexican TV comedy, follows two “directionless millennial bros” as they try to vault to success by becoming entrepreneurs. After debating ingenious startup ideas such as fartless diapers, Polo and Blas pitch a social justice / social media app that raises mns through crowdfunding. It all sounds fine and dandy, except for the fact that the duo can’t remember the pitch, don’t actually have an app — and have no idea how to make one. The series follows the pair as they attempt to put together a team and create the firm that was promised to their many investors. The show the sometimes hollow nature of the buzz surrounding tech startups, and the sheer luck that can fuel success.

???? TODAY IN THE TOKYO OLYMPICS:

Egypt’s football team suffered a narrow defeat against Argentina, losing 0-1. The Young Pharaohs are in the ‘group of death’ alongside European champions Spain, Argentina, and Australia. The U23 national team managed to hold their own against Spain with a 0-0 tie over the weekend and will next face Australia on 28 July.

Can Egypt advance to the knockout stage? We’re currently in last place with a single point, while Spain has four and both Argentina and Australia have three. The best case scenario for Egypt is to beat Australia on Wednesday, while Spain has to beat Argentina during their match on the same day.

Egyptian tennis player Mohamed Safwat is out of the Tokyo Olympics after losing against Colombia’s Daniel Elahi Galan in the first round of the tournament.

Other Olympics results:

• Fencer Mohamed Elsayed lost to Ukraine’s Ihor Reizlin in the epée men’s quarterfinals;
• Teammate Noura Mohamed also lost in the women’s individual foil to Japan’s Yuka Ueno;
• Rower Abdelkhalek Elbanna came in fifth in the men’s single scull quarterfinals with a time of 7:32:86;
• Doha Hany was defeated in badminton women’s singles, losing to China’s Chen Yufei;
• Doha Hany and Adham Hatem Elgamal lost in the mixed doubles against South Korean duo Chae Yoo-jung and Seo Seung-jae.
• No Egyptians qualified for the artistic gymnastics categories.

WORLD STANDINGS- China so far leads the standings with six gold medals in the first two days of games, followed by Japan with five and the US with four. Tunisia leads the Arab world (and is number nine overall) with one gold and one silver.

HAPPENING TOMORROW: The handball team goes up against world champion Denmark at 7:15am CLT, while Azmy Mehelba and Mostafa Hamdy are competing in the shooting’s men’s skeet tomorrow at 3am. As for taekwondo, Hedaya Malak — who snagged a bronze medal at the Rio Olympics — is going up against France’s Magda Wiet-Henin in the women’s 67kg round, while Seif Eissa will face off against Australia’s Jack Marton in the men’s 80kg round.

???? EAT THIS TONIGHT-

If you’re a fellow sandwich fanatic, check out this new Sahel joint: Describing itself as the ‘smoke ‘n’ roll sandwich shop’, Easy’s has opened up in Hacienda White and offers smoked meat galore. The sandwiches are imposing meat towers, with a short and sweet menu that offers a handful of options including smoked and pulled beef. Easy’s fries come with cheese and brisket on top, in a side dish that could be a meal on its own. For those of you who don’t feel particularly carnivorous, they also offer lobster and shrimp rolls.

???? OUT AND ABOUT-

Picasso Art Gallery is holding their Summer Exhibition at Marassi Clubhouse in Sahel until 10 September.

It’s stand-up comedy open mic night at The Room New Cairo tonight at 8pm.

???? UNDER THE LAMPLIGHT-

Could framing our problems differently help us come up with innovative ways to solve them? Framers: Human Advantage in an Age of Technology and Turmoil looks at the biggest risks to humanity and explores whether the way they’re framed can help us overcome them. “To frame is to make a mental model that enables us to see patterns, predict how things will unfold, and make sense of new situations,” write authors Kenneth Cukier, Viktor Mayer-Schönberger and Francis de Véricourt. Frames have become essential as computers take on more cognitive functions, leaving humans with the task of putting them into context. The book illustrates the argument with compelling examples such as covid-19, #MeToo, and the Apple/Spotify music rivalry.

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☀️ TOMORROW’S WEATHER- Monday weather is expected to be 38°C in Cairo. Enjoy the respite — the mercury is heading steadily upward before settling in the 40s next week. Look for 31°C in Sahel tomorrow, our favorite weather app tells us.

Aldar Properties has another 30 working days beyond a previous 2 August deadline to submit a mandatory tender offer for no less than 51% of real estate developer Sodic’s shares, after the Financial Regulatory Authority extended the bidding deadline based on a request by the Emirati real estate firm, the regulator said in an EGX statement (pdf). The decision gives Aldar more time to complete its due diligence, which the company said it was halfway done with in May. This is the third time the FRA has pushed the deadline.

Background: Aldar submitted in March a non-binding offer for a controlling stake in Sodic at EGP 18-19 per share, valuing the company at EGP 6.41-6.76 bn.

Advisors: EFG Hermes and an undisclosed international investment bank have the mandate to advise SODIC, while CI Capital is acting as the investment bank to the buyer.

Emirati waste management company Bee’ah is lobbying for more contracts in new cities. The company is in talks with the Environment Ministry and the New Urban Communities Authority (NUCA) to provide a waste management system for the new cities, CEO Khaled Al Huraimel told Hapi Journal.

Bee’ah could also be looking at a longer contract for the New Administrative Capital: The company had been contracted to provide waste management services at the New Administrative Capital for 15 years as of last March, but could see its contract extended as new phases of the administrative capital are inaugurated, officials at Administrative Capital for Urban Development (ACUD) — the company responsible for the management of the NAC management of the NAC — told Hapi.

What is the company bringing to the table? Bee’ah will manage solid waste in the new capital through establishing either a 2k meter square waste management station, or two 1k meter square stations, within every neighborhood in the new capital, ACUD officials said.

With apologies to Oscar the Grouch (watch, runtime: 2:29).

The German development bank KfW will provide EUR 41 mn to the Education Ministry over the coming year as part of a German-Egyptian debt-for-development swap program, the International Cooperation Ministry said in a statement. The funding will be allocated to three projects that aim to develop technical and vocational education in Egypt. The financing is the third tranche of the second stage of the debt swap program, and will be disbursed after the two sides agree on priority projects for funding.

What is the German-Egyptian debt for development swap program? The program was launched in 2011 when the two sides agreed to cancel EUR 240 mn in Egyptian debt owed to Germany, with the country instead allocating those funds to development projects in Egypt. The first EUR 70 mn phase has been received in full, and saw the implementation of projects targeting education and nutrition, the rehabilitation of hydroelectric stations, and the improvement of drinking water and sanitation services. The second phase saw KfW disbursed a first tranche worth EUR 10 mn to the Education Ministry to improve education, while the second EUR 80 mn tranche supported projects to develop human resources and improve sanitation in Upper Egypt.

Germany has pledged financing of EUR 1.7 bn for ongoing projects in Egypt covering various sectors, the statement said.

IN OTHER DEBT NEWS- Al Marasem Development signed this month EGP 3.3 bn-worth of Islamic financing agreements to finance real estate projects in the new administrative capital, according to Hapi Journal. Banque Misr and Banque du Caire provided over half of the funding, while AAIB, Bank of Alexandria, Housing and Development Bank, Al Baraka Bank Egypt, Suez Canal Bank, and Faisal Islamic Bank of Egypt also participated.

Dana Gas won an arbitration case brought by IPR Wastani Petroleum claiming that the UAE-headquartered company was in the wrong when it called off the sale of many of its Egypt assets to IPR. Dana disclosed the outcome of the arbitration case, which IPR filed back in April, in a statement (pdf) out this morning. Dana Gas called off the sale of its onshore oil and gas assets in Egypt as both parties failed to finalize the sale at the agreed timeframe. The sale, which both agreed on last year, was valued at USD 236 mn and was due to close in 1H2021.

The EGX30 rose 0.9% at today’s close on turnover of EGP 1.5 bn (19.3% above the 90-day average). Local investors were net buyers. The index is down 0.9% YTD.

In the green: GB Auto (+5.5%), Sidi Kerir Petrochemicals (+3.9%) and Abou Kir Fertilizers (+3.1%).

In the red: Sodic (-1.8%), Cleopatra Hospital (-0.9%) and Telecom Egypt (-0.7%).

How can we make sure AI does not reproduce human biases? AI is advancing at an accelerating pace, but researchers and tech workers have raised concerns that a lack of diversity in the AI community is creating a technology that discriminates against minorities, the New York Times reports. Researchers who have attempted to highlight the discriminatory nature of AI systems have faced backlash from companies, with Google dismissing two of its key AI researchers last year after they spoke up about the issue. In response to the ensuing backlash, Google promised it would change its research process.

How exactly can AI be biased? In 2015, Google was widely criticized for its online photo service after it auto-tagged and organized pictures of a black man into a folder labelled “gorillas.” Soon after, Google apologized and confirmed that the terms were removed from searches and image tags. Even more shocking, an investigation revealed that a computer program used by the judiciary and penal system in the US to calculate a criminal’s likelihood of reoffending is biased against black people, rating them twice as likely as white people to commit another crime. Predictive policing software, which uses AI to predict where crimes may occur and allocates police staff accordingly, has also been accused of over-policing predominantly black communities. Even a computer program designed to generate text called GPT-3 was found to have a low opinion of Black people, and to display sexism and other biases.

Why is this happening? AI systems rely on “neural networks,” and learn their skills by analyzing large amounts of digital data. If the engineers choosing the data when training these systems are biased (or narrow-visioned, or lazy) they could unknowingly feed the system material that is skewed in one direction, reproducing their own biases in the machines meant to liberate us from bias.

AI facial recognition comes with ethical challenges: A content moderation system built by US firm Clarifai was meant to automatically remove [redacted] explicit content from images posted to social networks, and engineers had been training the system to recognize the difference between those and G‑rated images (those suitable for a general audience). As the G‑rated images were dominated by white people, the system erroneously learned to identify images of black people as [redacted] explicit. Although an intern at the company reported the problem, the company continued using the model. Similarly, a black computer scientist reported being unable to get a detection system to identify her face until she put on a white plastic Halloween mask.

Some companies are wising up to the ethical issues: Last year, IBM, Microsoft and Amazon decided not to let police use their facial recognition technology, and IBM announced its intention to get out of the facial recognition business altogether amid concerns over bias, and until ethical safeguards for the technology are put in place.

What’s to be done? In one camp, some researchers say AI should be left to learn on its own until it eventually catches up to society, while others think human intervention should take place at the code level to try to filter out these biases. But shielding AI from the worst of human nature could necessitate the censorship of historical texts, songs, and other material, which would be a costly, and controversial effort.

Our take: Racist robots are not what we bargained for when we imagined our ideal techno-utopia, and if diversity in the AI field can make some headway rectifying that, then that is definitely something worth investing time and money into.

Mid-July: Legislative session expected to end.

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

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

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.

9 August (Monday): Russian flights to Sharm El Sheikh, Hurghada resume.

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.

1 October (Friday): State-owned companies and government service bodies selling goods and services to customers that have not yet signed on to the e-invoicing platform will suffer a host of penalties, including removal from large taxpayer classification, losing access to government services and business, and losing subsidies.

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.

November: The French-Egyptian Business Forum is set to take place in the Suez Canal Economic Zone.

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.