PM — Strong start to the new year

Good afternoon, ladies and gents. We’re just easing back into the flow of things on the first workday of the new year (and training our brains to write the correct year), but the news cycle here at home is already off to a strong start.

THE BIG STORIES TODAY

GB Auto approves GB Lease stake sale: GB Auto’s board has approved plans to sell a 45% stake in GB Lease to Abu Dhabi-based investment firm Chimera Investments for EGP 855 mn after approving the results of the fair value study (pdf), GB Auto said in an EGX disclosure (pdf).

#2- Misr Italia Properties has closed its second EGP 986 mn issuance as part of its EGP 2.5 bn securitization program, EFG Hermes, which advised the real estate developer on the transaction, said in a statement (pdf). The issuance is backed by a receivables portfolio of around EGP 1 bn from two of Misr Italia’s subsidiaries.

THE BIG STORY ABROAD

The international business press is still shaking off the new year daze, with no story driving the conversation. Among the headlines: Ukraine is shooting down drones launched by Russia in the third consecutive day of attacks from Moscow (Reuters); economists at major US banks are penciling in a recession this year or next (Wall Street Journal); retail investors are piling into commodities trading on the back of “bumper returns” (Financial Times).

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

• Importers can now turn the page on L/Cs: The Central Bank of Egypt (CBE) announced Thursday that it had lifted the requirement to use letters of credit to finance imports in an effort to clear a longstanding backlog of imports.
• New year, new private-sector minimum wage: The National Council for Wages has raised the minimum wage for private-sector workers by 12.5% to EGP 2.7k per month amid soaring inflation.
• The EGX dethrones the ADX as the region’s best-performing stock market: The EGX was the best-performing stock market in the Middle East in 2022 thanks to a bull run in 4Q sparked by the IMF agreement that erased losses.

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The EGX will be trialing an update (pdf) to its trading platform on Wednesday, 4 January and Thursday, 5 January from 3pm to 4:30pm. The update includes changes to the way stocks’ daily closing price is calculated and approved.

The Egyptian-Qatari Business Forum will launch during 1Q 2023, sources reportedly told Mubasher last month.

This could coincide with new investments from Qatari firms: The Sovereign Fund of Egypt is expecting more investments from the Qatari Investment Authority (QIA) early next year. The wealth fund is currently doing due diligence and finalizing agreements to purchase as much as USD 2.5 bn worth of state-held stakes in unlisted companies.

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

☀️ TOMORROW’S WEATHER- 2023 is off to a sunny start with temperatures in Cairo expected to hit 21°C tomorrow during the day before falling to 12°C at night, our favorite weather app tells us.

You’ll be soon hearing Siuuu blasting in Saudi Arabia: Portuguese football star Cristiano Ronaldo signed a contract with Saudi Arabia’s AlNassr FC until 2025, the Riyadh-based club announced in a statement. Ronaldo is joining the Saudi club after leaving Manchester United in November on the back of a controversial interview in which he criticized the club. “History in the making. This is a signing that will not only inspire our club to achieve even greater success but inspire our league, our nation and future generations, boys and girls to be the best version of themselves,” AlNassr said as it welcomed the player “home.” Details about Ronaldo’s contract were not made public, but his total annual salary is believed to be close to EUR 200 mn. If confirmed, Ronaldo would be earning the biggest salary ever in football history.

A slump in Tesla’s shares means Musk has lost a massive amount of his wealth: Elon Musk’s net worth has dropped by USD 200 bn on the back of Tesla’s shares falling 65% last year, making Musk the first person to lose this much of his wealth, Bloomberg reports. Musk is now worth USD 137 bn, after he lost his spot last month as the world’s richest person, “having been surpassed this month by Bernard Arnault, the French business magnate and investor behind luxury-goods powerhouse LVMH.” The Tesla and Twitter CEO has denied that his businesses are in jeopardy, saying on Twitter that “Tesla is executing better than ever” although the electric car company — whose market capitalization is north of USD 1 tn — is facing market competition and is reportedly slowing down production at its factory in Shanghai.

???? ON THE TUBE TONIGHT-
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Netflix’s five-episode British espionage thriller series Treason is perfectly bingeable — if you turn a blind eye to its many plot holes. When the head of MI6 Sir Martin Angelis (Ciaran Hinds) is poisoned, deputy Adam Lawerence (Charlie Cox) becomes first in command. A true family man, Lawrence immediately breaks the news of his promotion to his wife Maddy (Oona Chaplin) and they tell their children together. However, it does not take Laurence long to realize that his impressive ascension to the top has been meticulously orchestrated by his ex and former SVR spy Kara (Olga Kurylenko), who demands to be repaid for her favor. Lawrence’s rise to the top attracts a lot of suspicion and a CIA team led by Dede (Tracy Ifeachor) promptly arrives in London to investigate whether he has been compromised. Even Maddy, who is herself a war veteran, begins to suspect that something is amiss about Lawrence and begins to do some spying of her own. With a British election taking place in the backdrop and several spy agencies involved the plot does a pretty good plot of sucking you in, you just have to suspend your disbelief to enjoy it.

⚽ Competition is heating up in the Enterprise Premier League Fantasy League, with 150 Enterprise readers competing for a prize. Join us for a chance to come out at the top of the league through this link or by entering this code: 8o4sut.

English Premier League: Brentford faces off against Liverpool at 7:30pm.

The Egyptian League: The eleventh round began today, with Aswan kicking off a game against Zamalek at 2:45 pm. The score stands at 1-0 as we dispatch. Later at 5pm Al Ittihad plays Enppi and then Al Ahly face off against Pyramids at 7pm.

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Get an exclusive first look at Ali Arafa’s new upcoming EP at Room Art Space New Cairo at 9pm. Arafa and the band will also be performing covers of hit songs.

Picasso Art Gallery is hosting the Selections 1996-2022 exhibition, showcasing Sabry Mansour’s art. The exhibition will run through next Wednesday, 11 January from 11am to 9pm.

???? UNDER THE LAMPLIGHT-

Scatterlings tells the story of the breakup of the van Zijl family, after the Immorality Act, which criminalized interracial relationships, was passed in South Africa. Set in Cape Town in 1927, the fictional story follows Alisa van Zijl (née Miller) — a Black Jamaican woman who was adopted by a white British couple — her white husband, Abram van Zijl, and their daughters, Dido and Emilia. The newly passed Immorality Act essentially criminalizes the couple’s relationship and their daughters are now evidence of the illegal union. Those in violation of the new law face imprisonment — up to five years for men and four for women. At first, the couple seems unsure about whether this new law applies to them, given the privileges their economic status had previously afforded them, but when officials show up at the girls’ school and begin asking questions, Alisa’s worst fear is realized: She and her daughters now no longer belong in their home. In a moment of desperation, she takes matters into her own hands which leads to devastating consequences.

The EGX30 rose 2.5% at today’s close on turnover of EGP 1.63 bn (5.5% above the 90-day average). Foreign investors were net sellers. The index is up 2.5% YTD.

In the green: Alexandria Containers and Cargo Handling (+10.1%), Ezz Steel (+9.5.%) and Heliopolis Housing (+9.3%).

In the red: Juhayna (-2.0%), Telecom Egypt (-1.5%) and Orascom Construction (-0.2%).

The AI revolution is moving into its third wave: Currently, most of the AI out there falls into a narrow category, highly specialized systems that are very good at performing specific and well designed tasks, but unable to do much more. Enter the Third Wave of AI, where programs act as tools that are excellent at perceiving, learning, reasoning and are gaining the ability to generalize — essentially becoming more human, in a way, writes Scott Jones in Medium.

Case study: Sudowrite. A program transcending the barrier between the Second and Third Wave, which has caught the eye of authors using Amazon Kindle’s e-publishing platforms, reports the Verge. Sudowrite is an AI writing program built on Open AI’s language model, GPT-3. Once fed a text or prompt, GPT-3 programs adjust their randomized mathematical parameters to predict the next words, paragraphs, or whole chapters. Previous iterations of the program were used to generate company emails or marketing copy, but Sudowrite is designed for fiction. Its creators, Amit Gupta and James Yu, are both writers themselves and they fed Sudowrite plot twists and novel synopses, which while apt for producing short-length prose, struggles to evade certain genre cliches.

It’s something, but it’s not exactly flawless: Sudowrite can be described as “prompt programming,” and still requires human input to produce output based on statistical patterns. When overfed, Sudowrite produces “hallucinations,” ridiculous and long-winded descriptions — which are pretty entertaining in themselves. But it can be manipulated by its users to generate entire books with meaningful narrative frameworks.

Great for authors: Amazon Kindle’s e-publishing platform is dominated by authors churning out short fantasy stories in nine-week stints. Placed within niche microgenres, like “cozy paranormal mystery” or “mermaid young adult fantasy,” the works are often presented in installments, teasing out future plots and characters to keep readers dedicated. Due to the rate of production required in order to be commercially successful on the platform, some see Sudowrite as a helping hand that can speed up the process: Sketch out character descriptions, tighten up plot lines, and provide a way to push through writer’s block.

And for the commercially minded: Darby Rollins, coordinator of The AI Author Workshop, sees Jasper.ai (similar to Sudowrite) as a tool to create “the minimum viable book” — the cornerstone around which an individual can base their personal marketing strategy. Generate a book, ideally oriented around often-Googled questions that will show up in searches, and suddenly “now you are a thought leader, you’re an expert, you’re an authority, you have more credibility on a topic because you have a book in your hand,” quotes The Verge.

There’s a capability overhang when it comes to what we use AI for: As AI develops and enters the mainstream, the capability overhang (what we don’t know that AI can do, or haven’t even thought to ask for) will be minimized as new minds harness it for different means. As the brain usage of AI further reaches its potential, ethical, legal and business issues raised by AI questions are likely to include considerations of AI rights, as one program called for in an AI-written Guardian article in 2020.

Not all cultures use or think of AI in the same ways: While Western acceptance and desire to incorporate AI into our lives is largely determined by its ability to enter society as a form of manpower, the Japanese embrace of AI places it in the role of equal or friend, according to Japan Policy Forum. Take aibo, a robotic dog designed and manufactured by Sony that grows every day and acquires its own identity, dependent on its living environment and relationship with people. Aibo has no real purpose — it doesn’t clean or tell the time. For its owners, aibo is not a robot but a companion. The same is unlikely to be said about Siri or Alexa.