PM — A flood of conference announcements here at home and at COP26 + Russians tourists are back at resorts.

It’s another stacked news day, ladies and gentlemen, with the big local and global conferences making big announcements. We have new agreements signed at TransMea and Cairo ICT, and pledges that include Egypt coming out of COP26. You don’t want to miss this one.

THE OTHER BIG STORIES TODAY-

StartupLand is driving the conversation here at home this afternoon: Edtech platform OTO Courses secured (pdf) a USD 400k investment from EdVentures to develop the platform and expand its services to more segments; London-based fintech player Jumo is eyeing Egypt as a potential market for expansion after raising USD 120 mn in its latest funding round; and Disrupt Africa is out with a report indicating more Egyptian tech startups participate in accelerator or incubator programs than do in the rest of the continent.

Also guiding the conversation locally were the latest agreements signed at the TransMea 2021 conference. Abu Dhabi Ports (ADP) signed today an MoU to manage and operate a multi-use terminal at the Safaga Port, according to a Transport Ministry statement (pdf). The agreement, which was signed on the penultimate day of the TransMea 2021 transport conference, comes as ADP signaled it could invest as much as USD 500 mn in Egypt should it land contracts for two port development projects, including the Safaga Port. The agreement is among eight MoUs and cooperation protocols signed at the conference.

We’ll have a deep dive into the details of the agreements signed at the transport conference in tomorrow’s edition of Hardhat, our weekly publication on infrastructure in Egypt.

Over at the Cairo ICT exhibition, Benya Capital signed an MoU (pdf) with international VC firm Openner that will see Openner participate in launching Benya’s new USD 50 mn VC fund, Benya Ventures.

And we mustn’t forget, Russian charter flights are back: Moscow resumed charter flights between Russia and Hurghada and Sharm El Sheikh today, Russia Today reports. The resumption of charter flights also follows the reinstatement of direct flights from Russia to the Red Sea resort towns in August following a six-year hiatus.

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

• Sea change in Egypt-US relations: US Secretary of State Antony Blinken praised Egypt for its recent diplomatic efforts to negotiate ceasefires in Gaza and Libya, as well as its warming relations with Israel, but voiced “concerns” on human rights following the first “strategic dialogue” with Foreign Minister Sameh Shoukry in six years yesterday.
• Car traders could face EGP 2 mn fines for price gouging: Car dealerships that fail to comply with new rules from the Consumer Protection Authority requiring them to clearly display the full price of the vehicle (including tax) with a sticker on the windshield could be fined up to EGP 2 mn.
• Russian wheat prices rise again: Prices of Russian wheat hit new highs last week on the back of rising Egyptian demand, and prices could still be increasing as Russia’s state export tax is expected to rise again this week.

---

Subscribe to Enterprise

Egypt is among the list of 50 countries committed to developing climate resilient health systems at COP26: Some 50 countries including Egypt, the US, UK, and the UAE have made commitments to “build out climate resilient healthcare systems” at the UN Climate Change Conference in Glasgow on Monday.

What exactly did we commit to? That’s not yet clear what goals, or targets does this agreement entail.

There are, however, other agreements with more stringent aims: This comes alongside a separate list of 42 countries — which does not include Egypt— that have committed to reeling in the environmental impact of the global healthcare industry, according to a WHO press release. But as with the first agreement, the WHO has yet to provide detail on how and when they would execute the plan. Some 12 countries have set a more specific target of going net-zero by as late as 2050, but have yet to provide specifics on how they aim to achieve that goal either. Healthcare related emissions account for a total 5% of global CO2 emissions.

Separately, an agreement to halt new car emissions by 2040 due to be unveiled tomorrow is struggling to pick up steam as the US, China and Germany are holding out on committing, the Financial Times reports. Global automakers like Volkswagen and BMW have yet to sign on to any commitments due to the absence of key governments in the agreement. “There remains considerable uncertainty about the development of global infrastructure to support a complete shift to zero emission vehicles,” said BMW, who remained skeptical about the pace of shifting away from combustion engines, particularly in lower income countries. Ford, General Motors, Daimler and Volvo have said they are on board, and have pledged to phase out emissions at various points in the coming two decades.

New pledges by Japan could help developed countries make good on their climate finance commitments: Japan’s pledge last week of an additional USD 2 bn a year for the next five years towards helping lower-income countries mitigate the impacts of climate change could help developed countries reach their target by 2022, the Financial Times estimates. Rich countries had made a 2009 pledge to commit an annual USD 100 bn in climate finance by 2020 to help lower-income countries through their green transitions, but were not expected to reach that goal till 2023, with estimates putting the total funds currently at around USD 88-90 bn annually. Additional funding from Italy, the UK and Denmark is expected to help plug the gap, though not all of it will begin flowing next year.

HAPPENING NOW-

Day two of the “strategic dialogue” between Egypt and the United States is now getting underway. Foreign Minister Sameh Shoukry and US Secretary of State Antony Blinken addressed reporters yesterday at the end of the first day of talks, which saw the two sides cover everything from Egypt’s role as a key diplomacy anchor for the US in the region, concerns over human rights, and plans for climate-related and economic cooperation between the two countries.

FOR TOMORROW-

Inflation figures for October will be released tomorrow: Egypt’s headline inflation rate has been ticking up in recent months, hitting a 20-month high of 6.6% in September on the back of rising food and energy prices. The government had decided to raise the cost of natural gas for manufacturers and gasoline prices for motorists last month, and fertilizer and chemicals producers have signaled they could raise their prices by up to 20% to protect their operating margins. Then there’s the rising international wheat prices, partially due to rising demand from Egypt.

Carry trade still trumps inflation for now: Although the headline rate remains within the Central Bank of Egypt’s target range of 7% (+/-2%) — and analysts we’ve spoken with predict a stabilization of prices next year — rising commodity prices will likely factor into inflation figures over the next few months. We have one of the highest real interest rates in the world, making our bonds attractive to foreign portfolio investors. The central bank’s Monetary Policy Committee will meet one more time this year to review interest rates on 16 December.

But we need to watch out as developed countries are in a negative real interest rate climate in developed economies despite spiraling inflation. Countries including the US, UK and Germany are seeing persistent negative real interest rates after their central banks declined to hike rates anytime soon despite rising inflation, analysts tell the Financial Times.

What’s gotten analysts so worried? Rates below the neutral mark of 0 are highly stimulative, supporting debt financing and credit growth. But with developed markets already so highly valued, that could trigger financial instability down the line, some analysts warn.

But low interest rates are unlikely to last, with the Bank of England saying last week that interest rates will need to “rise moderately” to return inflation to its 2% target. The Fed meanwhile began unwinding its huge stimulus program this month amid concerns that inflation will remain elevated for longer than previously thought, with its asset purchase program expected to be completely phased out by June 2022.

???? CIRCLE YOUR CALENDAR-

The two-day Africa Fintech summit kicks off next Tuesday, 16 November. The summit looks at innovation in the fintech ecosystem, venture capital and other forms of investing, and will also discuss the rise of healthtech.

Calling all Egyptian entrepreneurs aged 23-35: You have exactly two weeks to apply for the acceleration exchange program Meet Silicon Valley for a chance to travel to California for a 10-day program to meet with tech executives and investors. The program is being implemented by Injaz Egypt and TechWadi with the support of the US Embassy in Egypt, and the deadline for applications is 23 November.

THE BIG STORIES ABROAD- GE splitting up for good: Massive US conglomerate General Electric will break up into three separate entities by early 2024, the company announced in a press release today. The move will see the company spin off its healthcare division in early 2023, before merging its renewables, power equipment and digital businesses into one entity to be spun off in early 2024. The remaining company, GE Aviation, will run the company’s engine-manufacturing arm.

The bulb that burnt out: Once a giant of industry, the company founded by Thomas Edison embarked on a sell-off and restructuring in 2018, as it grappled with a growing debt pile and reputational damage dating back to the 2008 financial crisis. The split is a chance to turn a fresh leaf (or three), as each segment moves forward independent of the weighty conglomerate structure, CNN Business reports.

Saudi Arabia’s economy expanded at its fastest pace in nearly 10 years in 3Q2021 thanks to higher oil prices, with GDP growth coming in at 6.8% during the quarter, according to data from the kingdom’s General Authority for Statistics. The oil sector alone grew 9% and the non-oil economy expanded 6.2%. This is the fastest pace of growth for the kingdom since oil prices hit USD 112 / bbl in 2012, Bloomberg notes.

---

☀️ TOMORROW’S WEATHER- It’s the last warm day before things cool down, with a daytime high of 29°C and a low of 17°C. The following day should see the high drop to 26°C, and stay there for a couple of days.

Hackers made off with the data of mns of Robinhood users last week, the digital trading platform said in a blog post on Monday. The data breach did not include users’ banking information and led to no financial losses, Robinhood said. The hackers used social engineering tactics to gain access to the email addresses of 5 mn users and the full names of a separate 2 mn people through a Robinhood customer service employee, according to the app—a scam that we’ve seen deployed increasingly of late.

Meanwhile, the US has brought charges against one Ukranian and one Russian in connection with the Russia-linked REvil ransomware attack earlier this year, in addition to seizing USD 6.1 mn in ransom payments made to one of the alleged attackers, according to a US Justice Department press release. The alleged hackers behind the attacks on US businesses and government entities — including multinational software company Kaseya — are being charged with conspiracy to commit fraud and money laundering, among other counts, which could land them each over a hundred years in prison if found guilty on all charges. Yaroslav Vasinskyi, the 22 year old Ukranian national who is currently in US custody has reportedly received USD 2.3 mn in ransom payments while Russian Yevgeniy Polyanin, who reportedly collected USD 6.1 mn from the attacks remains at large outside the US.

PSA- We’ve been noticing and hearing of more phishing attacks taking place here. We urge you to be careful and really make sure you know what link it is you’re clicking on before you do. We also highly recommend that your tech teams stay vigilant and educate other team members on how to spot phishing attacks and avoid them. It’s the Wild West out there, so, be careful, folks.

???? ON THE TUBE TONIGHT-

(all times CLT)

Everyone deserves a second shot at love: MBC streaming platform Shahid’s original productions are getting better and better, and one of our favorite offerings is Nemra 2 (English title: This Other Thing). Featuring a star-studded cast, the eight standalone episodes tell tales of unrequited, rekindled, abandoned, or unexpected love. The plot is largely dialogue-driven, with each episode involving tensions unfolding between two characters forced to be in close proximity for some time — such as the episode where Menna Shalaby and Ahmed Malek are locked in a bathroom at a house party, or an episode where Uber driver Maged El Kedwany must drive a distraught Sherine Reda to the airport in the middle of the night. With most stories leaving off on an inconclusive note, the show is less interested in showing us happily ever afters, but seeks rather to pose a series of gentle “what ifs?” The series has tinges of the New York Times’ popular Modern Love column, which has also been developed into a series, two seasons of which are available on Prime Video.

⚽ We’re still in the middle of the last international break of the year: There are no matches scheduled for today or tomorrow.

????EAT THIS TONIGHT-

A hidden gem on the Cairo-Alex Desert Road, KB’s Cake Studio offers a variety of cakes and “chewies” — the most adorable mini cookies that literally melt in your mouth — but their signature delicacy is hands down their tres leches cake. Get the classic if you want the real thing, and the coffee or rose water-infused cakes if you’re feeling adventurous. Don’t miss out on their ice cream cakes either, during what we hope are the final days of warm weather this year. You can order their desserts from their page on Instagram (Maadi and Tagamoa dwellers need to place their order one day ahead), or you can visit their tiny nook near Seasons Country Club.

???? OUT AND ABOUT-

(all times CLT)

Egyptian band Raï-na will take to the stage to share their love of Algerian Raï folk music from 9 pm tonight at Room Art Space & Cafe in New Cairo.

Egyptian Project are back with their signature blend of traditional folk music and Sufi lyrics at Cairo Jazz Club 610 in Sheikh Zayed from 8pm tomorrow.

Cairo fashion house Rasha Pasha will present their Winter/Spring 2021/22 collection, “To Cairo with Love,” at Downtown’s Townhouse Gallery this Thursday and Friday from 12pm-9pm.

???? UNDER THE LAMPLIGHT-

The road to life-saving medical discoveries is rarely without risk: The global vaccination drive has collided with the era of misinformation to produce an ugly war of words between pro- and anti-vaxxers. In his new book You Bet Your Life, Paul A. Offit, virologist, pediatrician and head of the Vaccine Education Center at the Children’s Hospital of Philadelphia, attempts to inject some nuance back into the debate.

Offit’s book takes us on a journey through the history of medical innovation, from transplants to blood infusions to, yes, vaccines — and shows that for every breakthrough, there is also a human cost. A staunch advocate of covid-19 jabs, Offit possesses the bravery to admit what vaccine-makers often won’t: That “the first vaccines aren’t always the best, safest, and last.” This engaging re-appraisal of what went wrong in medicine in order for things to go right inspires awe for trial patients who risk everything in the hope of finding new cures—and a healthy dose of scepticism for the claim that new medical interventions can ever be foolproof.

OUR ANALYST OF THE WEEK- Nour Kamel, investment analyst for financial institutions at the International Finance Corporation (Linkedin).

My name is Nour Kamel and I think I’ve experienced the finance field from all its angles [laughs]. I graduated from AUC in 2010 with a major in economics and started my career as a credit analyst at QNB Al Ahli. I covered the food and beverages sector for two years and also completed the first two levels of the CFA while I was there. I was interested in equities and financial markets, so I moved to sell-side research, first at Beltone and then at CI Capital. I started by covering the FMCG sector but then shifted to financial institutions. During that time I finished my CFA and also got an MBA from Edinburgh Business School.

My next move was to development finance and I began at Germany’s Finance in Motion before moving to my current position at the International Finance Corporation (IFC).

I’m part of the investment team at IFC that covers financial institutions across MEA. We focus on private sector development and offer a wide range of investment products across the debt and equity stream to financial institutions. We also supplement our investments with advisory services. We identify gaps or room for development in the different markets we cover and then filter down the market to select the most suitable potential partners that align best with our development mandate. It also works the other way around, where banks approach us for financing for a certain purpose such as climate finance, MSME or gender finance.

A recent transaction we worked on was CIB’s USD 100 mn green bond issuance. We felt that the Egyptian bond market was stagnant and there was a gap we felt we could fill given our expertise in this area. We worked with the regulator to establish guidelines for the market and then replicated our experience with other countries in Egypt.

The best part of my job is that I feel like I’m making an impact. It’s definitely nice to be part of the development side. I like that it’s a constant learning experience. We get a lot of experience working in different countries and as part of a diversified and global team. Since our work is project based, we work with a new team or person on every transaction. We try to work with locals in every new country to manage culture barriers and make communication easier.

The most challenging part is that there is always a lot going on in the region [laughs]. You have to focus on so many markets and be hands on when keeping up with all the developments. However, working with countries that vary in development makes it easier to pinpoint the gaps in financial markets and what they need to improve, as you have several similar references.

When looking at a potential investment in Egypt, the factor I find most interesting is the firm’s management. You really get a feel for how they run their business and how they assess their clients. I determine that a management team is a good one by comparing what they do to best practices, but there’s also a personal judgement angle that comes with experience.

Other than management, we look at their business model in general, carry out an appraisal, and look at specific aspects such as credit lending. If you’re initially discussing one kind of facility, as the conversation flows you can later decide that another one makes more sense

The macro picture in Egypt has been positive this year, and I think it will continue that way these remaining months. There has been a lot of development and reform over the past few years, which helped us to go into covid on a strong footing. Going forward, we really need to build on what has been achieved so far, and I think the direction is generally positive going into 2022.

For the Egyptian finance sector, this particularly holds true. There’s a lot of talk about fintech, green finance, and SME finance. There’s a lot of movement in those areas, but access to finance is still a big issue despite all the improvement we’ve seen. As covid-19 becomes more manageable and we slowly move away from the peak, I think many financial institutions have adapted well and have found ways to stimulate a pick-up in business.

The biggest trend I see in the local sector is the transition to digital. This includes an interest in fintech and mobile banking. We do get approached to help banks on that end and it’s definitely something we do.

I think we’ve all adapted well to work from home and less travel on the job. Of course we prefer face to face meetings, but going virtual has been more efficient. In my case, I don’t miss the two-hour commute every day, and I like that there’s time to switch off during a shift. We’ll probably go back to travel soon, but it’s definitely going to be less frequent than before.

The last thing I watched was the new season of You. I found it quite interesting.

A book I go back to a lot is Wherever You Go, There You Are by Jon Kabat-Zinn. It’s about how to be mindful about the basic things you do on a daily basis. Whenever I pick it up, I feel like I learn something new.

In my downtime I do a lot of yoga. I got a certification for teaching yoga when I spent a month in Bali. Which also shows my love for traveling, although that was mostly pre-covid [laughs].

---

MARKET ROUNDUP-

The EGX30 rose 0.8% at today’s close on turnover of EGP 810.5 mn (45.9% below the 90-day average). Regional investors were net buyers. The index is up 6.9% YTD.

In the green: CIB (+2.7%), EKH-EGP (+2.3%) and EKH-USD (+2.1%).

In the red: Raya Holding (-3.5%), AMOC (-3.4%) and Heliopolis Housing (-3.1%).