PM — GCC takes on Hollywood

Happy hump day, ladies and gentlemen. The news flow is picking up this afternoon, with a solid selection of stories to track as we slide into the second half of the week.

THE BIG STORY TODAY

Egypt has pulled the trigger on its maiden sukuk issuance: The country is in the process of offering some USD 1.5 bn in sharia-compliant bonds through the London Stock Exchange, sources with knowledge of the issuance told Enterprise this morning.

The three-year sukuk are being offered at an initial yield of 11.6% and have attracted more than USD 3 bn worth of orders excluding joint lead manager interest, Bloomberg reports citing a term sheet it has seen. A government source tells us that demand has been “very good,” noting that the yield could drop if the sukuk are oversubscribed. Investment banks on Monday wrapped up conversations with investors regarding the sukuk issuance.

REMEMBER- A successful issuance would help the government meet a major eurobond repayment due today. The government is due to repay USD 1.25 bn in five-year eurobonds that mature today, according to Reuters.

THE BIG STORY ABROAD

Putin suspends key nuclear arms treaty with US: Russian President Vladimir Putin announced that Russia would suspend its participation in the last remaining major nuclear-arms-control treaty between the US and Russia. He also vowed to keep up the military campaign in Ukraine. His comments on the New START Treaty came in a broader address to Russia's federal legislature in Moscow, just days before the anniversary of the invasion's beginning on 24 February. He once again blamed the West for starting the "special military operation" in Ukraine.

The story is front-page news in the international press, including Reuters | Financial Times | Bloomberg | Wall Street Journal | BBC

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

• Italy’s Intesa Sanpaolo is in advanced talks with the gov’t to acquire the rest of Alexbank. The Italian lender has been the majority shareholder of Alexbank since 2006 when it purchased 80% of its shares from the government.
• More funds for Egyptian SMEs: Private equity vehicle Avanz Manara plans to invest in three funds targeting SMEs during 1H 2023.
• EBRD predicts slower GDP growth in Egypt in 2023: The European Bank for Reconstruction and Development now sees our GDP growing at a 4.6% clip in 2023, down from its 5.6% estimate in September.

☀️ TOMORROW’S WEATHER- Expect a daytime high of 21°C tomorrow and a nighttime low of 11°C, according to our favorite weather app.

Hollywood is starting to open its arms to money from oil-rich Gulf countries, who are looking to invest bns in the entertainment industry, Lucas Shaw writes in Bloomberg. Film production companies had previously distanced themselves from Saudi Arabia, but resistance to funds from the kingdom is fading as traditional film financing sources such as Europe and the United States dry up, Shaw writes. Gulf nations, on the other hand, are flush with money, prompting financiers to question the logic of denying their funds. Studios can now receive financial incentives to film in Saudi, and dozens of celebrities flew to Riyadh in December for the Red Sea International Film Festival.

It’s not just Saudi; Qatar and the UAE have long been sources of funding for the media industry, Shaw points out. The Qatari sovereign wealth fund previously invested in the movie studio Miramax, and Mubadala, which is part of the government of the United Arab Emirates, has put a lot of money into Michael Jackson's music catalog. Remarkably, Egypt — once known as the “Hollywood of the Middle East” — is not mentioned in the report.

Some producers are drawing parallels between China a decade ago and the Middle East today, according to the Bloomberg report. China became the second-most-important film market in the world after Hollywood. Looking to develop its homegrown film industry and to extend its influence on the global stage, China pumped bns of dollars into their film industry to draw in US media companies. Once Hollywood was in, China kicked them out, keeping its practices. Chinese films have now surpassed American films at the top of the Chinese box office. Producers say that Saudi Arabia, like China, wants to use media and entertainment to gain more influence in the world and improve its reputation. The Saudi appetite for international films is expected to outnumber their desire for domestic films.

A shadow fleet of oil tankers from Russia? Moscow spent some USD 2.2 bn on proxy buyers to build up its shadow oil and fuel tanker fleet, according to a Bloomberg report. This led to a shortage of tankers on the market, which drove up freight prices for Russia's competitors. The goal is to get around the EU sanctions on Russian energy products by buying and using oil and fuel tankers that are hard to connect to Moscow. The business information news outlet says that the Russians are thought to own about 10–12% of the world's tanker fleet. In response to Western sanctions on its energy exports, Moscow decided at the beginning of this month to slash its oil output by 5%, or 500,000 barrels a day.

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Quincy takes us inside the mind of a legendary record producer. The life of Quincy Jones, one of the most successful music producers, is vividly portrayed in this Netflix documentary (watch trailer, runtime 2:35). Over the course of his 70-year career, Jones helped bring to life the work of musical icons such as Ray Charles, Louis Armstrong, Frank Sinatra, and Michael Jackson. His influence on pop music is undeniable, as evidenced by his 27 Grammy nominations and credits on more than 300 albums. Through interviews with friends, collaborators, family members, and former presidents, Quincy takes you on a journey through the producer’s life and, incidentally, through pop music history.

⚽ Liverpool vs Real Madrid kicks off at 10pm in the first leg of the UEFA Champions League Round of 16 at Anfield tonight. Liverpool's Premier League performance has been lackluster so far, but Jurgen Klopp's team has won their last two games, against Merseyside rivals Everton and Newcastle United. Meanwhile, some Real Madrid fans were worried they would be without their star player Karim Benzema, after he was left off the roster for their last La Liga match against Osasuna. The Ballon d'Or winner had been experiencing muscle fatigue, but he is expected back tonight.

In the Egyptian Premier League, Aswan v Al-Ahly kicked off shortly before we hit dispatch at 3:15pm. Later at 5pm, Ismaili faces Ghazl Al-Mahalla, and at 7pm, Haras Al-Hodoud plays against Pharco.

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Renowned musician Omar Khairat takes the stage tonight at 8pm in the Main Hall of the Cairo Opera House.

Bringing the master of silent film to life on stage: Charlie is a musical play about the legendary Charlie Chaplin's human side, his hopes and hardships, and his impact on the film industry. The performance will take place at Theatro Arkan on Friday, 24 February, and tickets can be purchased here.

Head to the She Crafts bazaar this weekend at the Grand Nile Tower Hotel in Garden City anytime between 12-8 pm. The bazaar aims to help women market their products and become more financially independent.

Rock fans rejoice: 1984, Galab and Dabbet Namla are taking the stage at El Sawy Culturewheel’s Castle of Rock Festival on Tuesday 28 February at 7 pm.

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Are humans getting dumber? This question underpins The Psychology of Stupidity, a thoughtful collection of essays and interviews. The book investigates why smart people sometimes believe in nonsense, how the little thinking machines in our heads cause us to make bad decisions, and how media and internet overexposure can make us dumber. The book was written by a small group of psychologists, philosophers, and intellectuals, mostly from France, and it combines expert perspectives on the most recent psychological and neurological research. Editor Jean-Francois Marmion sets the tone by rebutting the idea that we live in a "golden age of idiocy," while social psychologist Ewa Drozda-Senkowska makes a distinction between ignorance and stupidity. "True stupidity is the sign of a frightening intellectual complacency that leaves no room for doubt," she writes.

The EGX30 rose 1.3% at today’s close on turnover of EGP 1.72 bn (12.4% below the 90-day average). Foreign investors were net sellers. The index is up 16.7% YTD.

In the green: Sidi Kerir Petrochemicals (+6.2%), Heliopolis Housing (+4.3%) and Ezz Steel (+3.4%).

In the red: Edita (-1.7%), Juhayna (-1.4%) and Orascom Construction (-1.2%).