PM — What went down in DC last week

It’s a relatively calm Wednesday afternoon on the home front, ladies and gentlemen, giving us hope for a smooth slide into the weekend and Eid Al Fitr holiday.

SO, WHEN DO WE EAT? You’ll be breaking your fast at 6:30pm CLT this evening in the capital city, and fajr prayers are at 3:42am.

THE BIG STORY TODAY

Steel prices are cooling off: A handful of steel manufacturers in Egypt have started reducing their prices, head of the Cairo Chamber of Commerce’s building materials division Ahmed El Zeiny said, according to Youm7. Ezz Steel is among those companies, saying in a bourse disclosure (pdf) today that it will slash the price per ton of steel by EGP 830 to EGP 19,170. The rising costs of building materials has been a sore point for local contractors and real estate developers, which are feeling the pinch of higher prices brought on by the Russia-Ukraine war, as we’ve reported in previous editions of Hardhat (here and here).

THE BIG STORY ABROAD

Nothing is cooling off over in Europe: Russia’s decision to cut off natural gas supplies to Poland and Bulgaria is still leading the conversation this afternoon. The EU is mapping out a coordinated response, and has been working to ensure alternative deliveries in anticipation of a halt in Russian gas flows, with a meeting of the gas coordination group currently underway, European Commission chief Ursula von der Leyen said in a statement. Germany’s economy ministry said it was meeting with EU partners to discuss the decision, and that it is monitoring the situation “very closely,” adding that the country’s gas flows are currently at “a stable level.”

Not everyone is defiant, though: Four European gas buyers have already complied with Russian President Vladimir Putin’s demand to make payments in RUB, Bloomberg reports, citing sources in the know, adding that ten companies have already taken the needed steps to pay in the Russian currency and opened accounts at Gazprombank. Even if other buyers follow Bulgaria and Poland’s footsteps and reject Moscow’s demands, there probably won’t be other immediate gas cutoffs to more countries until the second half of May, when the next payments are due, the sources said.

MARKET REACTION- European gas prices surged by a fifth today, with futures contracts trading at EUR 106 / mWh. Meanwhile, Russia’s oil production is expected to fall by as much as 17% in 2022 — its most significant decline in decades — an economy ministry document showed, according to Reuters.

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

• State puts out welcome mat for private business, looking to net USD 40 bn in investment over four years: The state wants to attract USD 10 bn in fresh investment annually over an unspecified four-year period by opening the door to “private sector participation in state-owned assets,” President Abdel Fattah El Sisi said in a televised speech yesterday.
• A subsidiary of El Garhy Steel has acquired a majority stake in the National Glass and Steel Co. from ADIB Egypt, purchasing around 13.3 mn shares at EGP 2.25 per share for a total of EGP 30 mn.
• Saudi’s Foodics closes largest-ever SaaS series C round in Mideast: Saudi restaurant management platform Foodics has raised USD 170 mn in the biggest software-as-a-service (SaaS) series C funding round in the MENA region.

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???? CIRCLE YOUR CALENDAR-

Businesses have four days left to file their corporate tax returns. Companies with financial years ending 31 December have to file their returns by Saturday, 30 April.

Also on the final day of the month: The fixed customs exchange rate introduced last month following the EGP devaluation will be lifted. Greenbacks used for importing essential items such as basic commodities and materials used for manufacturing are currently changing hands at a fixed rate of EGP 16, a move introduced to minimize exchange rate volatility in the wake of the deval.

ITIDA has begun accepting applications for its annual Export IT program: The program is designed to encourage local IT companies to boost exports while reducing related costs. Interested companies have until 31 May to send in their applications, and can check the details here.

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

☀️ TOMORROW’S WEATHER- Sunny days ahead: It’s time to pull out your cap and sunglasses, as the coming days promise to be sunny and fairly warm, with tomorrow reaching 34°C during the day and 20°C at night, our favorite weather app tells us.

*** WE’RE LOOKING FOR SMART, TALENTED PEOPLE to join the team and help us build some very cool new things. Today, we run two daily publications, five weekly industry verticals, a monthly newsletter — and we have tons more in the pipeline. We offer the chance to work in a fast-paced newsroom on a broad range of topics and in a variety of formats. Our goal is simple: To create value for our growing community of >199k readers by telling stories that matter.

Enterprise is currently in the market for the following positions:

Senior editors who will manage a team of reporters on our current and future editions. Candidates should have at least three years of experience in journalism and a minimum of one of those should have been spent as an editor — but we would deeply value someone with at least five years of work experience. Strong knowledge of Egypt and the region, a demonstrated interest in business / finance, and people management skills are musts.

Seasoned reporters to join our team and create stories that fascinate and inform our readers. Applicants should have serious English-language writing chops, a strong interest — and preferably some professional experience — in business / finance or business journalism, and solid analytical skills. You’ll be expected to pitch stories and take assignments, as well as develop leads into full-blown stories. Reporters should be fluently bilingual, though exceptional unilingual (English) candidates may apply.

We have a preference for Egyptian nationals but will consider international applicants.

Are you a career switcher? Investment bankers, lawyers and other folks trained to be analytical and tell stories do well with us. If you want out of the rat race, consider us an offramp.

Interested in applying? To apply for the editor / reporter positions, please submit your CV along with 2-3 writing samples and a solid cover letter telling us a bit about who you are and why you’re a good fit for our team. Please submit all applications to jobs@enterprisemea.com.

Wegz partners with Metavisionaries to provide education solutions through the metaverse and Web3: Egyptian rapper and trap singer Wegz is collaborating with Metavisionaries as an ambassador, helping spearhead the company’s efforts in Egypt, he said on Instagram. Metavisionaries believes that the metaverse and Web3 can help mitigate several issues facing humanity such as climate change, quality education, the future of work, healthcare and economic inequality. In Egypt, Metavisionaries will first focus on education, using these new technologies to make education accessible to underprivileged individuals by overcoming financial and geographical obstacles. The Metavisionaries team includes NASA’s former Chief Scientist Tara Ruttley, entrepreneurial pharmacist Wasim Ahmed, e-learning practitioner Ricardo Simms, and the former executive director of UNICEF Lithuania, Jovita Majauskaite.

There aren’t more details out as of now, but Wegz’s post promises that more information will be announced soon.

Meta is expected to post its slowest growth since its IPO in 2012 when it releases its quarterly results later this evening, the Wall Street Journal reports, citing analysts. Forecasts are penciling in revenue growth below 10.7% y-o-y, and a USD 7.1 bn bottom line, which would mark a decline in net income for the second quarter in a row. The Facebook and Instagram parent company has seen its stock price plummet since its last earnings in February, which showed lower-than-expected gains, a gloomy revenue outlook, and a drop in its daily active users. Since then, Meta shares have fallen nearly 44% and the company has lost nearly USD 388 bn in market value. Meta’s main source of revenue, its advertising business, was also hit by privacy changes it adopted on its platforms last year.

???? ON THE TUBE TONIGHT-

(all times CLT)

This new series tells the story of how the iconic film The Godfather almost never got made: The Offer documents the 1970s tale of trying to get The Godfather off the page and onto the screen amid several hurdles such as the political environment at the time and financial pressures in Paramount studios. The 10-part series follows Albert S. Ruddy — The Godfather’s producer, portrayed by Miles Teller — as he fights the system to push the movie into production, all while holding on to a demeanor of grace and poise. Audiences of the show get to see everything unravel, from the first pitch of the movie, to the difficulties in convincing the production house that it would be worthwhile, and all the way to casting Marlon Brando and Al Pacino. It’s a humorous and dramatic take on the series of events that eventually led to one of the greatest works in American cinema history getting made. The Wall Street Journal is out with a review.

⚽ Al Ahly fans will be glued to their TV screens at 9:30pm today as the red team plays against Al Gaish in the Egyptian Premier League. At the same time, Pyramids will face Ceramica Cleopatra.

And in a continuation of epic Champions League matches, Liverpool will face Villareal tonight at 9pm. Yesterday saw Man City beat Real Madrid 4-3 in an exciting game that had fans on the edge of their seats.

Serie A is also on tonight: Fiorentina will play against Udinese at 6pm, while Bologna will face Inter and Atalanta will compete with Torino, both at 8:15pm.

???? OUT AND ABOUT-

(all times CLT)

Take your doggo for a photoshoot at L’Immeuble Building at an event courtesy of Cocoon Cultural Centre. There will be coffee for the humans and snacks for the dogs while The Darkroom will be snapping film shots of everyone. The event — taking place today at 7:30pm — also aims to raise money for Animal Care Egypt through the sale of tote bags.

A music and fitness festival to attend after Eid: Boost is organizing Run Up The Beat, a fusion between music and fitness events where attendees will be required to finish a run to attend British R&B star Craig David’s concert that will take place after. The event is happening on 13 May at Mountain View’s Chillout Park in 6 October. Tickets are now on sale at TicketsMarche.

???? UNDER THE LAMPLIGHT-

The tactics for great leadership and management: Roger Martin has a long career advising CEOs of large businesses on how to conduct themselves in front of shareholders and employees. In his new book, A New Way to Think, he puts all of these lessons on paper, making Forbes’ “10 Must-Read Career and Leadership Books For 2022” list. Martin argues that most executives stick to one “model” — a framework or way of thinking that guides their strategy and activities. However, in order to be successful, business leaders need to grasp the importance of customizing approaches based on the person or situation. He also delves into the entire breadth of the management landscape, looking at ways to build a strong corporate culture, a sustainable innovation process, and more.

EARNINGS WATCH-

Alexandria Containers and Goods saw its bottom line rise 25.1% y-o-y to EGP 1.27 mn in 9M 2021-2022, according to an EGX disclosure (pdf). Sales also increased during the period, rising 6.3% y-o-y to EGP 1.83 mn.

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MARKET ROUNDUP-

The EGX30 rose 0.3% at today’s close on turnover of EGP 767 mn (13.1% below the 90-day average). Foreign investors were net sellers. The index is down 10.3% YTD.

In the green: Mopco (+7.0%), Rameda (+6.1%) and Cleopatra Hospitals (+3.8%).

In the red: MM Group (-2.5%), Madinet Nasr Housing (-1.8%) and EFG Hermes (-1.5%).

RECAP — The IMF / World Bank Spring: The war in Ukraine and ensuring food security in developing countries stole most of the attention last week as global financial chiefs descended upon Washington, DC for the IMF / World Bank’s annual Spring Meetings. The general outlook this year was grim as heightened concerns over the fragile state of a global economy suffering from a high inflation climate and a war in Europe took center stage. Here’s our round-up of what drove the headlines during the week.

Global growth downgraded: The main event came on Tuesday, when the IMF released its latest World Economic Outlook. As anticipated, the Fund downgraded its global growth projections for the second time this year, warning that economic activity is in for a “significant slowdown” due to the war in Ukraine. Its economists are now expecting the global economy to grow by 3.6% this year, 0.8 percentage points lower than its January forecast.

There was good news if you’re Egypt, which was spared from the global trend. The IMF upgraded its growth forecast for Egypt, and now expects its economy to expand 5.9% this year, 0.3 percentage point higher than anticipated in January. The revision is the second time the IMF has improved its outlook on Egypt this year.

“The world’s growth engines are now sputtering”: That was the reaction to the report by Allianz Chief Economist and markets sage Mohamed El Erian, who wrote in an op-ed for Project Syndicate that the IMF’s downgrading of its 2023 growth forecast to 3.6% was an indicator that traditional export- and foreign investment-led growth models are losing their effectiveness. Why? Protectionism, latent supply chain issues caused by the pandemic and the general trend towards deglobalization.

The World Bank pledged bns of USD to help countries facing pandemic, food crises: The Bank said it is in talks to provide USD 170 bn in emergency financing over the next 15 months to help vulnerable countries facing “multiple overlapping crises” including the pandemic, soaring inflation, and food and energy insecurity. Details on how the funding will be distributed remain to be seen, but the lender said it hopes to have USD 50 bn to deploy by the end of 2Q 2022.

Calls for the G20 to get serious on debt relief: The IMF urged rich nations to offer debt relief to low-income nations, which have been battered by the pandemic and now soaring food and energy prices. The G20 common framework — an initiative backed last year to help poor countries handle unsustainable debt levels — “has yet to deliver,” the IMF’s chief economist, Pierre-Olivier Gourinchas, wrote in the Fund’s outlook. “When a country is in a situation where its debt is not sustainable, it is in everyone’s interests to have an expeditious process for debt relief. The common framework is not proving to be quick enough in providing resolutions,” he said.

But the G20 seems to have sat on its hands: The group doesn’t appear to have discussed any concrete mechanisms for moving towards greater debt relief, with a statement following their meeting saying only that it “discussed progress on the implementation of the G20 Common Framework on Debt Treatment, and called for the next steps to be more timely, orderly and predictable.”

One of the world’s most debt-distressed countries made progress towards an IMF loan: Sri Lanka could be closer to receiving an aid package from the IMF and World Bank after “fruitful discussions” during the meetings, the IMF said on Saturday. The Fund is considering offering a USD 500 mn emergency loan while the World Bank will provide USD 10 mn for essential medical purposes, according to Reuters.

But there was no word on Egypt’s prospects for another emergency loan: Egypt was expected to discuss with IMF officials its application for a third programme, with Georgieva saying ahead of the meetings that the Fund would hold talks to discuss the country’s rising debt levels. Neither the Egyptian government nor the IMF have since commented on the status of the talks.

Prepare for further market instability as rates rise: A senior IMF official warned that global financial markets will likely continue to fall as central banks across the world continue to raise interest rates to combat spiraling inflation. Equities, corporate bonds and sovereign debt will likely see a “certain amount of readjustment” going forward as financial conditions tighten, Tobias Adrian, director for monetary and capital markets at the IMF, told CNBC.

There was plenty of talk of assistance for Ukraine: IMF Managing Director Kristalina Georgeiva said Wednesday that Ukraine will likely need around USD 15 bn over the next three months to keep it afloat, and that the Fund will hold talks with other countries to provide grant financing. The US said it would give another USD 500 mn to help keep the government functioning, doubling the USD 500 mn pledged in March.

G7 officials didn’t want to hear any Russian during the event, staging walkouts during the G20 session and several IMF meetings in protest at Moscow’s participation following its invasion of Ukraine.

US urges caution on Russia gas ban: US Treasury Secretary Janet Yellen called on the EU to exercise caution on a full ban of Russian energy to avoid rising energy prices globally and economic hardship in Europe. “Medium-term, Europe clearly needs to reduce its dependence on Russia with respect to energy, but we need to be careful when we think about a complete European ban on say, oil imports,” she said during a presser on Thursday.