PM — Gaming our way through the pandemic

Happy THURSDAY, friends — it’s finally the end of this busy workweek. We could have a four-day week coming up next: Expect an announcement this coming Sunday or Monday that we’re taking next Thursday off in observation of the 25 January holiday.

The Nutty Professor returns to show us he’s not all that nutty: The 74-year-old US professor we brought to you yesterday afternoon with his gloriously profane digital syllabus is out with another video explaining that his syllabus introduction was specifically designed to seem insane. The “scripted performance,” as he calls it — and which circulated on the internet without context — is meant to grab his students’ attention with the crazy suggestion that he might grade them arbitrarily and not based on their actual work. This is meant to be an exercise “to get them thinking about predestination” by experiencing what it’s like to have a strong preconceived notion and then unlearning it with time (watch, runtime: 5:09).

THE BIG STORY TODAY

We could have a trade agreement with South Korea soon: President Abdel Fattah El Sisi and South Korean President Moon Jae-in discussed today looking into setting up a bilateral trade liberalization agreement, according to the Korean press. The two sat down earlier for wide-ranging discussions, according to an Ittihadiya statement. Moon arrived in Egypt yesterday for a visit that will wrap tomorrow, marking the first time a South Korean president has been in town on official business in 16 years.

Korea is also set to provide us with soft loans worth USD 1 bn over the next five years to finance construction and infrastructure projects, including transport and water infrastructure, as per an MoU the two presidents signed today. South Korea’s ambassador in Cairo had announced the planned loan earlier this week.

Still to come: The two countries are expected to sign several more agreements while Moon is in town, including cooperation on EVs and electric microbuses, potential involvement from South Korea in the construction of the Dabaa nuclear power plant, and manufacturing giant Hyundai setting up a “production plant” in the Suez Canal Economic Zone.

^^ We’ll have more on this story in Sunday’s edition of EnterpriseAM.

HAPPENING NOW-

Day 4 of digital Davos rolls on: A discussion on how space research can improve life on earth is set to begin minutes after we hit “send” on this afternoon’s edition, with the New York Times’ Deputy Managing Editor Rebecca Blumenstein, former US Vice President Al Gore, the UAE’s Minister of State for Advanced Technology Sarah Al Amiri, and European Space Agency officials speaking on the topic.

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

• Non-oil exports rose 26% y-o-y to hit a record USD 32 bn in 2021, up from USD 25.4 bn in 2020. The rise was underpinned by efforts to support exporters with subsidies and pay off arrears, restructure export councils, and bilateral and multilateral trade agreements.
• Maiden sovereign sukuk issuance inches closer: The Finance Ministry got the green light to start preparing to take its first sovereign sukuk issuance to international markets, after the Madbouly Cabinet signed off on the move yesterday.
• Egypt made it past the round of 16 in Afcon with a 1-0 victory against Sudan last night, putting the Pharaohs in the second spot in Group D, behind Nigeria.

THE BIG STORY ABROAD

The economics-focused news cycle is far from abating, with a tale of two interest rate approaches: Erdonomics-lite is the new monetary policy Turkey appears to be pursuing, with its central bank deciding today to leave interest rates on hold, after a chaotic and unorthodox monetary easing spree that caused inflation to soar and the TRY to nosedive, Bloomberg reports. It’s unclear how long Ankara will hold off on further monetary easing, but President Recep Tayyip Erdogan had signaled earlier this week that further interest rate cuts will be introduced more gradually.

Meanwhile, China enacted more tiny rate cuts “to support a slowing economy” bogged down by its property market slump, the Wall Street Journal reports. Beijing cut its one-year loan prime rate by a marginal 10 bps, following a 5 bps cut to the same rate last month. The People’s Bank of China also reduced its five-year loan prime rate by 5 bps for the first time in nearly two years, bringing it down to 4.6%.

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???? CIRCLE YOUR CALENDAR-

The Cairo International Book Fair opens next Wednesday, 26 January at the Egypt International Exhibition Center. The event runs 13 days until 7 February.

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

☀️ TOMORROW’S WEATHER- Cold nights ahead: Expect daytime highs in the range of 16-17°C over the weekend while the mercury will plunge to 6-7°C at night, according to our favorite weather app. Stay warm folks.

Is the glass ceiling for women in business starting to crack? An unprecedented number of women now hold seats in the boardrooms of the largest banks in the US, with more than one-third of board positions now occupied by women, Bloomberg reports. But while women are advancing in terms of the number of seats, men still occupy the positions with the greatest power, enabling them to call the shots. This year, Citigroup’s Jane Fraser became the only woman CEO among 19 members of the S&P 500 Banks Index. None of the companies on the index has a woman in the chairman’s seat, and only three women are lead directors, a position that is designed to act as “a check” on chairmen.

How are we faring in Egypt? As of last July, around 85% of EGX-listed businesses have at least one woman sitting on their boards, after the Financial Regulatory Authority (FRA) introduced the requirement in 2020 in a bid to end all-male boards. The FRA then upped that requirement last year to require the boards of EGX-listed firms and non-banking financial services companies to be at least 25% composed of women.

Just don’t ask whether women are getting equal pay for equal work…

Big Oil is on a hiring spree as competition for carbon-emissions traders heats up: BP and Royal Dutch Shell have hired “an array” of carbon-emissions traders to replace multiple staff members lost to trading houses in 2021, Bloomberg reports. As the cost of emissions continues rising, competition’s grown over the last year for experienced traders of carbon credits and offsets — which the oil majors are active in, Bloomberg notes. Now, firms like commodity trading companies Trafigura and Mercuria and investment banks like Citigroup are looking to get in on the action — leaving Big Oil on a mission to replenish its ranks of environmental-products traders, it adds.

Brits, brace yourselves — the upcoming months may be tough on your wallets: UK citizens are staring down the barrel of an “acute cost-of-living crunch” thanks to high tax hikes, surging interest rates, and pervasive inflation, Bloomberg reports. The impending “living standards catastrophe” is expected to materialize in April, experts suggest, coinciding with a 50% rise on the ceiling for national energy costs, while higher taxes will be introduced in an effort to shore up public finances. UK inflation accelerated to a 30-year high of 5.4% in December, raising pressure on the Bank of England to raise interest rates to rein in price surges. Altogether, these factors are set to all but obliterate the impact of wage gains, with the Center for Economics and Business Research estimating that expenses for an average UK household will rise by GBP 2k before taxes surge.

In other UK news, crypto ads could be marketed to only wealthy and experienced investors, as the Financial Conduct Authority (FCA) is looking to protect consumers from high-risk investments, according to a press release. Advertisements would only be able to target investors if they are “high net worth or sophisticated” and are required to be clear, fair and not misleading. The FCA will await feedback on the proposal until 23 March before coming to a final decision during the summer.

Hackers have broken into Red Cross’ servers, gaining access to data of over 515k vulnerable people, reports the Associated Press. These include people “separated from their families due to conflict, migration and disaster, missing persons and their families, and people in detention.” The breach had targeted an external contractor in Switzerland who stores data for the Red Cross. So far, there is no indication who is behind the attack and whether they will choose to leak the information.

???? ON THE TUBE TONIGHT-
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WHAT’S NEXT- The National Geographic film Own the Room follows five students competing for the Global Student Entrepreneur Awards: The series inspires hope for the future as you watch these young minds think up brilliant ideas despite their difficult personal circumstances. The first third of the film introduces each student and their background, really building up the audience’s connection to each contestant and giving you a feel for the source of their motivation. Most of the students have been displaced from other countries, but their immigrant status has not deterred them from aiming to help the world, sometimes inspiring them to solve problems in their original place of residence. The viewer then follows them as they travel to China for the global competition and, in the case of a young African boy, facing discrimination at the airport. Nonetheless, they all make it to finally pitch their startup ideas in front of a panel of judges. If you’re anything like us, you might just get emotional as you watch them “own the room” and convince you that there’s still a generation pushing for change.

⚽ Group E and Group F are up tonight in Afcon: The former will see Sierra Leone play against Equatorial Guinea and Ivory Coast play against Algeria, both at 6pm. Meanwhile at 9pm, the four Group F contenders will all hit the field: Gambia vs. Tunisia and Mali vs. Mauritania.

Egypt next play on Wednesday, 26 January. We’ll take on whoever tops Group E in the final 16. Group E is still wide open, and any of Ivory Coast, Equatorial Guinea, or Sierra Leone could top the group. So pay close attention to tonight’s matches.

(Algeria cannot top the group, as we mistakenly said this morning. H/t to eagle-eyed reader Amr L. for the note.)

Egyptian League Cup: Pyramids is currently playing Al Masry and Eastern Company is taking on Al Ittihad as we dispatch. Later at 5pm, Misr Lel Makassa and Future will play a match. Among tomorrow’s matches is Al Ahly versus Al Mokawloon at 5pm while Saturday will feature El Zamalek competing against Ghazl El Mahala at 5pm.

La Liga: Getafe will play against Granada at 8pm tonight while Espanyol will face Real Betos at 10pm tomorrow. Matches will pick up speed on Saturday as Levante faces Cadiz at 3pm, Villareal plays Mallorca at 5:15pm, Sevilla plays Celta Vigo at 7:30pm, and finally, Atletico Madrid kick off against Valencia at 10pm.

Serie A: Verona take on Bologna tomorrow at 9:45pm in the sole match of the day. Meanwhile, matches on Saturday include: Genoa vs. Udinese at 4pm, Inter vs. Venezia at 7pm, and Lazio vs. Atalanta at 9:45pm.

Six matches to tune into in the EPL this weekend: Watford and Norwich city will hit the field tomorrow at 10pm before Super Saturday kicks in full steam starting with Everton playing against Aston Villa at 2:30pm. At 5pm, Brentford will face Wolves, Leeds United will face Newcastle, and Man United will face West Ham. Ending the day are Southampton and Man City who will compete at 7:30pm.

Coppa Italia: Roma and Lecce will play today at 10pm in the last cup match this month.

Copa Del Rey: Elche will compete against Real Madrid tonight at 8pm while Athletic Club will face Barcelona at 10:30pm.

What’s been happening in the transfer market? The January transfer window didn’t see a lot of the exciting rumors materialize so far, with less than two weeks until it closes. Some of the updates until now include Philippe Countinho joining Aston Villa on loan and showing a stellar performance during his first match with the team. Aston Villa also signed Everton left-back Lucas Digne for GBP 25 mn. Meanwhile, it was a shock when 30-year-old Italian national team star and Napoli winger Lorenzo Insigne decided to leave Europe — the hub for international football — signing with Toronto FC on a four-year contract. Newcastle went on a shopping spree after the team’s Saudi acquisition, signing Kieran Trippier and Chris Wood, soon earning the team an “overspending” transfer warning, reports Chronicle Live. Finally, Anwar El Ghazi — who has a market value of EUR 10 mn — has moved to Everton on loan.

???? EAT THIS TONIGHT-

Everyone will find something they like at Ni: The restaurant brings the very best of Italian and Japanese cuisine with a diversified menu that still manages to bring high quality dishes no matter what you order. They have a great selection of pastas and sushi as well as a smattering of essential international dishes such as burgers and chicken strips. Start off your meal with their mixed focaccia, crispy spicy tuna, or truffle fries. If you’re going the Japanese route, try out their poke dishes; if you’re leaning towards Italian, Ni’s tagliatelle alfredo and mushroom risotto are not to be missed. Finally, dessert is highly recommended at Ni — their pain perdu is an experience, as are their crepes. You can find Ni on both ends of the city: Park St. Mall in Sheikh Zayed and 5A by the Waterway in New Cairo.

???? OUT AND ABOUT-
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Cinematic film forum MedFest will kick off today in Downtown. The festival features workshops, round tables, lectures, master classes, and films from all over the world that will be shown at Zawya Cinema, Goethe Institute, and Consoleya. The event will run until Sunday.

Join AcroDance Aerial Academy’s crystal singing bowl meditation tonight at 7:30pm in Heliopolis, with the session utilizing singing bowls set at different harmonic frequencies to add to the meditation experience.

Medrar is screening two groundbreaking VR films by Emmy award winning artist Yasmin Elayat on Saturday, Sunday, and Monday from 1-6pm. The films, The Changing Same and Zero Days, are documentaries that can be experienced with VR glasses to give a fully immersive experience. On Sunday, Elayat will be on location to give a talk on her filmmaking experience.

???? EARS TO THE GROUND-

The Pitch will take you into a room full of investors: Each episode of the Gimlet podcast features an entrepreneur that will soon pitch their idea to a number of investors. The podcast aims to show “how people sell their ideas, what makes investors tick, and how these initial conversations can bloom into business agreements — or die on the vine.” While the concept isn’t new, The Pitch is a refreshing take on the format, focusing more on the story behind these entrepreneurs’ companies as opposed to the shock value seen on TV shows such as Shark Tank. It also offers a realistic depiction of investors, who might sometimes focus on negligible aspects of a business or change their mind before writing a cheque. Newer episodes also delve into the makings of the VC world and how covid-19 has disrupted the investment climate.

???? UNDER THE LAMPLIGHT-

An expose on the bn’aire class and how they “devoured the world”: Journalist Peter S. Goodman draws on decades of covering the global economy to write his new release Davos Man. The book looks at how the world’s most affluent segment have exploited the pandemic to further expand the wealth centralization that has put them so far at the top, no one else can reach them. Goodman profiles five members of the bn’aire class, whom he calls Davos Men, to show their hidden impact on nearly every aspect of modern society. He covers everything from widening wealth inequality, wage decreases, and unequal taxation all the way to the rise of anti-democratic nationalism and the vulnerabilities of our health-care systems. Goodman creates a well-rounded book in the sense that he allows voices from every class to chime in with their experiences, showing how the decisions and policies enacted by these bn’aires have affected an African immigrant in Sweden or a Seattle doctor fighting covid-19.

The EGX30 rose 0.1% at today’s close on turnover of EGP 746 mn (35.2% below the 90-day average). Local investors were net sellers. The index is down 1.8% YTD.

In the green: EFG Hermes (+1.4%), GB Auto (+1.1%) and CIB (+1.0%).

In the red: Fawry (-3.3%), AMOC (-3.0%) and Raya Holding (-2.6%).

Have you been relying on video games to power you through the pandemic? So have mns of others in MENA. It’s become a familiar scenario over the past two years. Work’s done and you want to unwind, but soaring covid case numbers discourage going out. At home, you have snacks and Halo Infinite’s finally been released. For many of us, the choice is simple — video games.

We’ve got news for you, gamers. You’re not alone: Throughout the world, gaming activity increased by an estimated 46% in 2020, with mobile gaming specifically growing by 17%, according to a mid-2021 report by Orient Planet Research and G&K Consulting. This was largely driven by covid-19 lockdowns and stay-at-home directives, the report notes.

Global gaming has become a huge industry. In 2020, it was worth over USD 160 bn annually, with the global gaming community set to exceed 2.7 bn people by the end of the year, according to a Forbes contributor. The global number of players was up 5.3% y-o-y in mid-2020, according to the 2020 Global Games Market Report produced by market intelligence firm Newzoo.

And MENA’s been one of its fastest-growing markets: As of mid-2020, the MENA games market accounted for 3% of global market revenue, having grown 14.5% y-o-y to be worth USD 5.4 bn. At the time, it had some 377 mn players, the Newzoo report revealed.

Regionally, mobile gamers far outnumber PC or console gamers: Mobile gaming is the largest gaming market in the region, thanks to relatively high smartphone penetration, the abundance of free-to-play games, and internet infrastructure that’s strong in KSA and the UAE, and improving in Egypt, reports tech news hub GamesBeat. Among Egyptian gamers surveyed for a 2020 YouGov report, only an estimated 14% played on consoles, compared to 58% who used a smartphone or tablet. In KSA, 20% played on consoles compared to 52% on mobiles, and in the UAE, 21% played on consoles compared to 57% on mobiles, YouGov noted.

In fact, mobile gaming grew in MENA by an estimated 25% in 2020, and was expected to reach USD 4.4 bn by 2022, according to the OPR-G&K report picked up by Trade Arabia. It was worth an estimated USD 1.06 bn in 2016.

“MENA represents a key [window] for the video game industry,” said Daniel Ahmad, senior analyst at market research and consulting firm Niko Partners, in a recent email to GamesBeat. “The region has often flown under the radar due to its small game development scene, fragmented markets as well as language and cultural barriers, but it has quickly become a region of importance.”

Within MENA, Egypt, the UAE, and KSA “are on the frontier of this growth due to housing the highest populations of gamers,” Ziad Samaha, VP New Business at the UAE’s Khazna Data Centers wrote in computer magazine PCMag last month.

New data shows the three countries are set to remain the region’s major players: In Egypt, KSA, and the UAE alone, the gaming market could be worth an estimated USD 3.14 bn by 2025 — up from USD 1.76 bn in 2021, according to Niko Partners. The number of gamers in these three countries is set to rise to 85.76 mn in 2025, up from 65.32 mn in 2021, notes the firm. Its new report on MENA’s gaming sector aims to “provide a representative overview of Arabic speaking markets,” focusing on Egypt, KSA, and the UAE — which it calls the MENA-3.

It all translates into hefty revenue: Collective revenue from video games in Egypt, KSA, and the UAE reached USD 1.7 bn in 2021, according to Niko Partners. Egypt accounted for 9.8% of that revenue, while KSA made up 60.6% and the UAE 29.6%. By 2025, it could rise to USD 3.14 bn, at a 5-year CAGR of 13.8%, the report estimates.

Egypt has by far the highest absolute number of gamers out of the MENA-3: Collectively, approximately 65 mn gamers in Egypt, KSA and the UAE were active in 2021, the Niko Partners report tells us. Some 38 mn of those gamers — 59% — were in Egypt, while 20 mn — 30% — were in KSA, and 7 mn — 11% — were in the UAE. Egypt is “an emerging games market with an active and competitive gaming community,” it adds.

But on average, gamers in Egypt are spending only a fraction of what our regional peers are forking out: On average, a gamer in Egypt spends USD 4.5 per year on games, while a gamer in KSA spends USD 53.9 and one in the UAE spends USD 72.5, the Niko Partners report says.

While KSA’s population of some 34.8 mn and high spending power make it “the gaming powerhouse of Arabic-speaking nations in MENA,” according to Niko Partners.

All three countries have seen government support of the gaming industry: Egypt, Saudi, and the UAE have seen policies issued to encourage local game development, new studios and offices of international game companies, and hosting major esports tournaments, the Niko Partners report tells us. “Esports are booming in MENA and a key driver of growth, with Saudi Arabia even including it in its Vision 2030 plan,” Ahmad told GamesBeat. (Esports are human-to-human video gaming competitions that — like real sports — often have a spectator element to them.) Here in Egypt, the Information Technology Institute’s (ITI) Game Development Academy, which was set up in 2010 to provide game development programs, hosted last year a virtual Global Game Jam — a hackathon focused on digital game development.

And MENA’s sizable youth population could also be driving popularity: Nearly 50% of the region’s population are younger than 25, and have “grown up as digital natives with gaming playing a huge role in their entertainment,” notes Niko Partners. Further growth will be driven by higher spending per user, additional government support across games and esports, and more gamers entering the market, the report adds.

Still, keeping up with industry trends requires solid telecoms infrastructure, some note: Reliable, high speed internet connections are key to video game quality, says Samaha. The high-end video gaming industry has capitalized on tech advancements, using impressive graphics, augmented and virtual reality for greater immersion. Dependable service and immense capacity will be needed to deliver these top-quality user experiences — particularly when it comes to esports, Samaha says. Investing in telecommunication — and especially data centers — could be an effective way to build the digital infrastructure that would support this, he argues.

And in Egypt at least, we may still have some way to go on that front: As of January 2021, Egypt had an internet penetration rate of 57.3% and we ranked in the bottom 50% of GSMA Intelligence’s Mobile Connectivity Index, we reported in June 2021. Though Egypt is hoping to capitalize on certain strategic advantages to become a heavyweight in the data center industry, progress has so far been slow, as we noted previously.