PM — Gov’t presents spending plans for next fiscal year

Happy Monday, wonderful people. It’s shaping up to be a relatively eventful — and certainly an interesting — news day as we get into the full swing of budget season and Planet Startup continues to make headlines.

THE BIG STORIES TODAY

#1- Maait, El Said present state spending plans for next fiscal year at the House: Finance Minister Mohamed Maait and Planning Minister Hala El Said have just wrapped presenting the draft FY 2022-2023 state budget and sustainable development spending plan to the House of Representatives’ general assembly, according to statements (here and here).

Among the budget highlights:

• Total spending is expected to rise 15% y-o-y to EGP 2.07 tn;
• Revenues are forecasted to come in at around EGP 1.8 tn;
• Debt servicing costs are expected to be brought down to 7.6% of GDP, or around a third of the overall budget for the fiscal year.

#2- Paymob closes Egypt’s largest ever fintech series B round: Egyptian fintech startup Paymob raised USD 50 mn in a series B round, in what it says is the largest round of its type for an Egyptian fintech firm, the startup announced in a statement (pdf). The round was led by Kora Capital, PayPal’s global corporate venture arm PayPal Ventures and Clay Point.

^^We’ll have more on these stories and others in tomorrow’s edition of EnterpriseAM.

THE BIG STORY ABROAD

Russian President Vladimir Putin compared Moscow’s invasion of Ukraine with the fight against Nazi Germany, in his annual Victory Day speech marking Germany’s defeat in 1945. In a display of military might in Moscow’s Red Square, Putin blamed Western countries and Nato for rejecting security demands, but contrary to predictions, he did not make any declarations of victory or announce new escalation plans. Instead, he said the Russian forces’ military operations were “necessary, timely and the only right solution,” and that they entered Ukraine as “preemptive pushback” to what he claimed were Western plans for an imminent attack on eastern Ukraine. The story is front-page news in the international press: Financial Times | New York Times | Bloomberg | Washington Post

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

• Oil + wheat spend to rise FY 2022-2023: The Finance Ministry will set oil prices at USD 80 a barrel in the FY 2022-2023 budget, coming in at the bottom range of the USD 80-85 a barrel range signaled by Vice Minister of Finance Ahmed Kouchouk last month.
• Gov’t eyes 84% debt-to-GDP ratio in FY 2022-23: The Madbouly government wants to bring Egypt’s debt-to-GDP ratio down to 84% in FY 2022-2023, marking the first time the debt target for next fiscal year has been revised since the Finance Ministry in January said it hoped to bring the public debt down to below 90% of GDP.
• Rate hikes leave gov’t with at least EGP 6 bn in unexpected debt costs: The House Budget Committee has approved legislative amendments that would unlock an extra EGP 6 bn to help Egypt meet its debt repayments as interest rates rise at home and abroad.

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???? CIRCLE YOUR CALENDAR-

A huge US “GreenTech business mission” is inbound next week. More than 40 US companies will be in Egypt during 15-17 May to kick the tires on green investment and potential business partnerships in sectors ranging from energy to healthcare, agriculture, aviation, construction and water resource management. The high-level delegation will meet with members of the business community and senior government officials.

The Central Bank of Egypt will meet to review interest rates on Thursday, 19 May.

The last of this season’s earnings releases will drop by 31 May after the Financial Regulatory Authority granted listed companies a two-week deadline extension.

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 mild heat wave continues with the mercury rising to 32°C during the day tomorrow before falling to 17°C at night, our favorite weather app tells us.

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Can gene editing help prevent heart attacks? Google Ventures-backed biotech player Verve Therapeutics claims to be “on the cusp” of developing a gene editing tool that can help stop bad cholesterol and prevent heart attacks by emulating genetic mutations linked to low levels of cholesterol, offering them protection from heart attacks, CEO Sekar Kathiresan said, Bloomberg reports. The plan is to initially target people who have had heart attacks because of high cholesterol caused by a hereditary condition known as familial hypercholesterolemia, before eventually using the genome therapy on younger people as a preventative measure. The Nasdaq-listed firm — currently valued at USD 700 mn, nearly 76% below its original valuation of USD 2.89 bn — plans to begin human testing in months, after successfully cutting bad cholesterol levels in monkeys by 59%.

But it might be a tough sell to consumers: Not only are the long-term effects of gene editing still widely unknown, it stands to hold a hefty price tag — and insurers are unlikely to be easily swayed to cover a new, radical therapeutic method, the antiviral-meds-info.com information service writes. Analysts forecast the therapy to cost from USD 50k to USD 200k, and CEO Sekar Kathiresan says the estimated range is “a reasonable starting point.”

Has the world learned lessons from the AIDS crisis? Covid pill shortages in poor countries indicate otherwise. Covid-19 antiviral pills are widely available in the United States, but continue to be limited in low and middle-income countries, evoking memories of the HIV epidemic, the New York Times reports. Nations are facing the same hurdles and inequities that existed two decades ago — rich countries are gobbling up the supply, while drug companies are trying to limit generic alternatives in middle-income countries in efforts to protect their patents. Meanwhile, low-income countries lack sufficient funds to even buy covid tests. “If you’re not testing, you can’t sequence, you can’t isolate, you can’t treat. Everything else unravels,” said Bruce Aylward, a top World Health Organization official.

???? ON THE TUBE TONIGHT-

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Bullsh*t the Game Show is a competition show that sees how well you can lie through your teeth: If you get impressed with the skill of persuasion, you’ll love Netflix’s most recent game show. Contestants are faced with multiple trivia questions, but if they don’t know the answer they can BS their way through it and try to convince at least one of three judges that their answer is correct. Judges who call out the most lies and point to the right answers play as contestants in the next episode. The prize pool starts from USD 1k and can go up to USD 1 mn based on how many levels you pass. The show is hosted by Howie Mandel — of America’s Got Talent fame — whose comedic persona makes the show a hilarious watch. A handful of people at the Enterprise HQ have reported binge watching the entire show in a sitting, but maybe that’s just us.

⚽ Fiorentina hosts Rome in Serie A at 8:45pm, which is an important match for the two teams, who occupy the eighth and seventh places respectively, with a difference of 3 points. The match today will see them compete for the qualifying positions for the European championships.

In the Egyptian League: Eastern Company and El Mokawloon’s match starts at 4pm, while Pharco plays with Future at 6:30pm, and El Gaish plays against National Bank at 9pm.

???? OUT AND ABOUT-

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Liwan Gallery is holding the opening reception of its newest exhibition “Untitled: Travel Identification Documents” by Hossam Sakr today at 6pm. The exhibit will run until 26 May.

Estabena — The Mediterranean Music Project — will perform at MASQ (Ma’qad of Sultan Qaitbey) tomorrow at 5:30pm. Estabena blends diverse sounds and musical inspiration from around the Mediterranean. The event will also feature the Sultan Spring Bazaar where you can find Egyptian handcrafted products made in the Qaitbey neighborhood and around Egypt.

???? UNDER THE LAMPLIGHT-

If you could go back in time and make different decisions… would you? That’s the basic premise of the novel This Time Tomorrow by Emma Straub. When Alice falls asleep as a 40-year-old and wakes up as her 16-year-old self, she can change the course of the future by making different choices in the past. Sent back to the carefree days with her best friend, her young love, and her healthy father, Alice must decide what aspects she wants to keep for her older self and what she wants to leave behind. This novel is a sweet take on the passing of time, the power of relationships, and the misguided rush to adulthood. The time travel aspect doesn’t come off as gimmicky while the author brings back a ton of Back to The Future references that will please millennials.

The EGX30 fell 1.8% at today’s close on turnover of EGP 1.0 bn (12.2% above the 90-day average). Local investors were net buyers. The index is down 8.7% YTD.

In the green: Orascom Development Egypt (+5.1%), e-Finance (+4.9%) and Egypt Kuwait Holding-EGP (+1.8%).

In the red: MM Group (-4.7%), CIB (-4.2%) and Madinet Nasr Housing (-4.0%).

Could microorganisms become the future of recycling? In recent years, a series of scientific breakthroughs have uncovered the effectiveness of certain microorganisms in the process of plastics recycling. Though still in the early stages of development, these enzymes are showing promise in plugging some of the holes that remain in traditional recycling processes. Some companies have even started working to address the problem of plastics recycling through this supposedly more efficient chemical process, but whether — and how soon — these discoveries can be scaled to meet commercial volumes of plastic waste is yet to be seen.

Plastic-eating microbes are not just a thing of science fiction. Scientists have known about different kinds of plastic-eating bacteria since as far back as 1991 but it wasn’t until 2016 that a group of Japanese researchers discovered a strain of bacteria called Ideonella sakaiensis 201-F6 that was particularly adept at doing so. This new strain could grow and subsist entirely off of polyethylene terephthalate (PET) — the type of plastic that’s tough and hard to break down, and is used to manufacture almost all single-use bottles and textile fibers. This meant that the bacterium could break down the complex chemical bonds formed in the production of PET — and it did so using certain enzymes that naturally evolved to have this particular ability.

What about traditional recycling? Currently, the most popular form of recycling is a process known as mechanical recycling where plastics are shredded, washed, and occasionally melted down before re-entering industrial processes. The problem with this method is that each iteration results in weaker and lower-quality plastic, meaning that resources eventually do go to waste.

Chemical recycling supposedly avoids this problem entirely: One of the most promising aspects of chemical recycling is that it bypasses the inevitable waste issue endemic to its mechanical counterpart by breaking down plastics into its most basic form. Being able to turn single-use water bottles back into the building blocks that once created theoretically means that there could be no resources lost in recycling manufacturing processes (assuming we are able to collect everything we produce).

Laboratory experiments pushed these enzymes further into the future: By 2018, the enzymes discovered on this new strain of bacteria were modified by a group of researchers at the University of Portsmouth to become even more efficient at breaking down PET. Government funding of some GBP 6 mn awarded to these researchers has since allowed them to figure out a way to make these enzymes degrade PET six times faster than before.

There’s also evidence to suggest that more microbes around the world are developing the capability to break down plastic, especially in places where plastic pollution is highly concentrated, according to one 2021 study by scientists from Sweden’s Chalmers University of Technology. A separate 2020 study from TU Bergakademie Freiberg and UFZ scientists found that a strain of bacteria that exists in soil exhibited the ability to degrade polyurethane.

One French company focused on enzymatic recycling is already gaining attention and funding: Late last year, French biotech company Carbios opened its first testing facility where it has been ironing out its PET recycling system using a completely new type of enzyme that they have enhanced to become faster and withstand higher temperatures. Carbios along with T.EN Zimmer and Deloitte have already received a EUR 3.3 mn European grant to build out its system which it hopes will be able to process 40k tons of plastic by 2025.

Some skepticism about this technology remains: First, there’s the question of scalability, which some think might take too long to reach. “We don’t have more years to figure this out and wait for new technology,” Kate Bailey, policy and research director at a nonprofit recycler based in Colorado tells ArsTechnica. Then there’s the issue of energy, which enzymatic recycling requires more of than mechanical recycling — though it is difficult to compare because enzymatic recycling supposedly reduces the amount of fresh plastic used in industrial processes. There’s also the problem that chemical recycling so far doesn’t work on other, tougher plastics.

Reeling in plastic production and pollution will require multiple efforts: With some 367 mn tons of plastic produced globally in 2020 and roughly 12 bn metric tons of plastic waste expected to pile onto the surface of the earth by 2050, it is likely that more ways than one will be required to address our plastic problem. Both mechanical and chemical solutions will likely have to be relied on in the coming years to absorb the current amount of waste floating around our planet, as will our need to drastically reduce the production of new plastic.