It’s another news dump day on hump day, ladies and gentlemen. And if you’re like some of us here and lost interest in yet another day of our world leaders disappointing us on the environment, we have teenagers getting approved for vaccinations here at home, interest for SPACs on the EGX, Fed day kicking off and more Black Mirror-type shenanigans from world tech giants.
THE BIG STORIES TODAY-
THIS JUST IN- Children aged 15-18 will be offered Pfizer vaccines in Egypt, acting Health Minister Khaled Abdel Ghaffar said in a cabinet meeting today, according to a Madbouly cabinet statement. Details of the rollout for the age group will be announced within hours, the minister said, adding that unvaccinated university students will not be allowed on campuses as of 15 November.
SPACs already gaining traction in Egypt? Two companies are already poking into setting up SPACs to acquire and list fintech players in Egypt, according to Zulficar & Partners founding partner Anwar Zeidan. The two unnamed companies are in the non-banking financial services space and are currently in talks with the Financial Regulatory Authority about the necessary steps they need to take in order to list, as the authority works on setting up regulations to govern the blank-check companies. The announcement comes a day after the FRA yesterday greenlit the proposal to allow SPACs in Egypt.
Could Egypt be getting a slice of a USD 673 mn BlackRock climate-focused infrastructure fund? BlackRock's Alternative Investments’ global head of renewable powers David Giordano named Egypt as an “attractive investment” among emerging markets, as its climate-focused fund plans to invest in renewables and other green projects, according to Reuters.
^^ We’ll cover these stories in greater detail in tomorrow’s EnterpriseAM.
** CATCH UP QUICK on the top stories from today’s EnterpriseAM:
- Wheat prices rise again: State grain buyer GASC paid 1.5% more for Russian wheat purchased in the latest international tender as reduced crop production in some of the world’s biggest producers and higher shipping costs are pushing up global prices.
- Chip shortage weighs on car sales: Passenger car sales dipped slightly in September, falling more than 2% y-o-y from the same month last year, with industry leaders reporting that the culprit remains shortages of the chips used in modern vehicles.
- Edita’s first production line in Morocco will be up and running within days, IR director Menna Shams El Din confirmed to Enterprise yesterday.
HAPPENING NOW- The House of Representatives has adjourned discussions on the Unified Budget Act until 14 November, according to Youm7. The House wants the input and testimony of Finance Minister Mohamed Maait on a number of articles of the bill, but has given its preliminary approval on all other articles.
Background: The draft act aims to merge legislation governing the state’s annual budget and fiscal governance into an updated bill. If passed, the bill would require the government to present a medium-term budgetary and fiscal strategy to the House of Representatives each year. The act would also alter how the state budget allocates funding by imposing a top-down structure that would require the government to set spending limits for each ministry, which would then divvy up the funding for the bodies and organizations under its purview.
Tourism Minister Khaled El Anani is at the Travel & Tourism Expo in London, which is running 1-3 November. The minister held a presser with UK media yesterday, answering questions about Egypt’s covid safety measures and the opening of the Grand Egyptian Museum next year.
It’s also Fed day: The US Federal Reserve begins its two-day meeting today, in which it is widely expected to announce the winding down of its USD 120 bn a month asset purchase program instituted at the start of the pandemic to stimulate the economy. All eyes will be on the Fed’s Open Market Committee’s decision on whether it will pull the trigger on scaling back its program, which Fed chief Jay Powell has previously said could happen in November.
The Fed will no doubt have inflation on its mind: The knock-on effect of global supply chain delays, shortages of a range of goods, and soaring prices threatens to seriously undermine economic recoveries, according to new research by Bloomberg Economics. Across the world, production slowdowns and clogged distribution networks are bringing significant shortages — nearing a 20-year high in the US, UK and euro area. The Bloomberg gauges provide plenty of data — including factory gate prices, the ratio of inventory-to-sales for retailers, and the backlog of orders for service-sector firms — supporting the Fed’s assessment in September of supply-side disruptions and strong demand driving up prices and inflation.
What’s it all leading to? Stagflation, but not quite as we know it, Jim. The current environment is best described as stagflation-lite, Bloomberg notes, as continued high inflation remains a challenge for central bankers. Keeping rates low would allow the recovery to continue, but prices could spiral — while tightening would quell inflation but stifle demand. Traders anticipate two rate hikes from the Fed in 2022, but Bloomberg Economics modelling suggests that “if inflation runs strong and unemployment falls, even two hikes next year might not be enough.”
Over in China, citizens have been told to stockpile food and other essentials, as authorities further tighten the country’s strict covid-19 containment measures to suppress a small outbreak, the Financial Times reports. The government hasn’t directly cited covid as a reason to store essential items, but 54 new locally-transmitted cases were reported on Monday. China’s food prices are generally volatile, and vegetable prices have surged in recent weeks, due to inclement weather, the salmon colored paper added.
THE BIG STORY ABROAD- Over 100 countries have pledged to halt deforestation by 2030 at COP26: World leaders from some 110 countries, along with 30 financial institutions, have committed to end deforestation by 2030 at the COP26 UN climate summit in Glasgow today, the BBC reports. Some USD 19.2 bn in public and private funding have been committed to the cause so far and will go, in part, towards supporting efforts in developing countries to combat forest fires, revitalize land damaged by deforestation and help indigenious communities protect forests. Details on how exactly the pledge will be enforced and whether it will follow the same fate as a separate 2014 pledge so far remain unclear but some set of standards for sustainable supply chains and trade agreements appear to be in the pipeline.
Also from COP26: A US-led commitment to reduce global methane emissions by 30% by 2030 is in the pipeline through a joint US-EU pledge, with some 90 countries, including Brazil, reportedly signing on to the pledge to clamp down on methane, Bloomberg reports. The US-led effort could see limits placed on gases coming from some 1 mn oil and gas rigs in the country and expand federal oversight to some 425k miles of pipeline that were previously unregulated. A component of the initiative also stipulates a plan to capture 70% of methane emitted from landfills in the US, but the effort will rely primarily on voluntary action.
But developing nations must step up to help less developed countries in the transition to net zero, writes South African President Cyril Ramaphosa for the Financial Times. “The needs of workers and communities in industries and geographies that will be hurt by such a transition must be carefully considered,” calling for developed economies to provide grants, loans at concessional rates of investment to ensure the transition is “just.”
ALSO GETTING COVERAGE- Yahoo has pulled its services from China, effective today, citing an increasingly challenging business environment, the WSJ and Bloomberg report. This comes less than a month after Microsoft’s LinkedIn exited Beijing, also pointing fingers at the “challenging operating environment”. While Microsoft’s announcement was a big blow to China which has already been suffering from a wave of closures from foreign companies, Yahoo’s move is more symbolic than anything. Yahoo has been shutting down main services such as email and news in China starting 2013 and coincided by chance with the tech crackdown in the country.
Iconic Syrian singer Sabah Fakhri passed away today in Damascus at the age of 88, with his son telling AFP that Fakhri died a natural death. The musician’s passing is a “huge loss for Syrian art,” Anas Fakhri added. Born in Aleppo and hailed as one of Syria's greats, Fakhri gained popularity for creating Syrian folk music that often included Arabic poetry in its lyrics, revitalising traditional Arabic music genres such as Qudud Halabiya and Muwashshah. The National and Sky News are also out with obituaries.
In his memory, here are some of our favorite songs by Fakhri: Fouk El Nakhl | Qaddok El Meyas | Ebaatly Gawab | Ya Mal El Sham
It’s PMI: November’s purchasing managers’ indexes for Egypt, Saudi Arabia and the UAE will land tomorrow. Last month’s PMI reading hit a four-month low as the private sector continued to contract, with weaker customer demand driving down new orders and output. On the upside, firms reported a record level of confidence in upcoming business activity, while employment rose for the third consecutive month.
Other key news triggers in November:
- Foreign reserves: October’s foreign reserves figures will be out sometime this week;
- Inflation: Inflation figures for October will be released next Wednesday, 10 November;
- There’s no MPC meeting this month — the central bank will next meet on 16 December to review interest rates for the final time this year. The CBE has yet to issue its MPC calendar for 2022.
The Africa Early Stage Investors Summit kicks off tomorrow, starting with an investors meetup, sponsored by the Cairo Angels, at Consoleya in downtown Cairo. The summit will continue on Thursday and Friday with virtual sessions featuring speakers from angel networks, VC funds, accelerators, and the public sector, among others.
Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.
☀️ TOMORROW’S WEATHER- The mercury will inch back up again to 31°C during the afternoon tomorrow before falling to 19°C at night, our favorite weather app tells us.