Thursday, 31 December 2020

Welcome to the new normal


Your Wealth is a custom Enterprise briefing for people just like you: Executives, entrepreneurs and builders who know that time isn’t money, but that time and money are feedstock for the one thing that matters most in life: Your family, however you define it.

Once a month, in partnership with our friends at CIB Wealth, we’ll bring you a hand-picked selection of ideas, tips and inspirational stories that will help you make the most of your time, enhance our wealth, and build a better life with the people you love.

As always, we love hearing from readers. Send us story ideas, hints, tips or interview suggestions to


As much as we’d like to throw 2020 and everything that came with it into the dustbin of history, the unfortunate reality is that many of the changes experienced last year will likely stick with us for the long haul. The ways that we work, learn, travel and trade have all been thrown up in the air over the past 12 months, and a return to some of our pre-2020 comfort zones is unlikely to happen — at least not in the short to medium terms.

But don’t get too despondent: As disruptive as the past year has been, there are silver linings aplenty. Many of the changes we’ve been forced into as both a country and a planet are likely to make our day-to-day lives easier and more convenient; whether that’s the flexibility to work from home or improved access to education and healthcare.


Are offices now a thing of the past?

The death of the office? For many white collar workers, remote work has become the norm over the past year as businesses across the world shuttered their offices in response to the pandemic. Although questions remain about the long-term viability of the WFH model, the pandemic has prompted some businesses to reconsider the necessity of having physical working spaces, raising questions over the fate of the office in the years to come.

Employees might not want to return to pre-covid norms: Some 80% of people surveyed by McKinsey indicated that they enjoy working from home while 41% said they have been more productive than before. A separate survey conducted by Stanford University in May found that 55% of US workers wanted some mix of home and office work, if only to spare them the stress of a daily commute, while only a quarter of people polled by Gallup said they wanted to return to the office post-covid. There’s also data from well before the outbreak of covid-19 that suggests there are productivity gains to be seen in partial WFH schedules, often for simply providing a quiet environment for workers to focus.

Some companies are reviewing their need for office space: In June, S&P Global said it expected the crisis to cause a structural shift in demand for office space, causing a gradual decline as some companies make covid-era contingency measures permanent. The WFH trend, it said, “could ultimately erode tenants' demand for traditional office space and dampen overall occupancy and rent levels.” A number of large firms in the US plan to cut back on office space in the coming year, and almost three-quarters of financial services companies in the UK are considering doing the same.

The situation in Europe is slightly different, where new lease agreements with several major companies haven’t been disrupted by the pandemic, the Wall Street Journal reports. “The demise of the office is exaggerated,” said Jack Pringle, director for Europe, the Middle East and Africa for architectural firm Perkins & Will, who suggested that business will struggle to attract top talent offering WFH.

But rather than abandon offices completely, most are likely to adopt a hybrid model: Even with widespread vaccination efforts on the horizon it seems likely a hybrid model will become the course of action for most businesses for the foreseeable future. There are still some perks to having in person interactions, especially for collaborative projects and team building, but meetups may become more selective in the future, rather than the norm. Businesses will tailor their schedules differently over the coming period depending on their particular needs, but for a lot of places it has become clear that a lot of work can be done remotely and workers are often happier doing it that way.


Deglobalization after covid-19

Could covid reverse the tide of globalization? The past year pulled the brakes on global trade flows, forcing businesses and consumers alike to think and spend more locally, and accelerating a deglobalization of the world economy. With global lockdowns limiting travel of both people and goods in a way previously unimaginable, could 2020 bring a permanent shift to the cross-border flow of commodities, people and ideas?

Covid-19 has brought to light the faults with a China-reliant supply chain, prompting a rethinking of the traditional wisdom driving a globalized economy of seeking out the lowest production costs wherever they may be. As Chairman of the European Union Chamber of Commerce in China Jörg Wuttke told Bloomberg: “The globalization of putting everything where production is the most efficient—that is over.” But aside from covid-19, US-China tariff wars as well as sanctions on the use of US technology by Huawei have meant that companies have had to look for local alternatives. As deglobalization accelerates, we’re likely to see a repeat of the Huawei example all over the world, and a resurgence of developmental economic theories such as the “big push” that encourage developing economies to orient themselves away from exports and towards local markets.

On the other hand, covid could end up inspiring a different sort of globalization. According to DHL’s 2020 Global Connectedness Index, while capital flows decreased globally and the movement of people retreated to a level last seen in 1990, cross-border internet traffic saw a 48% increase from mid-2019 to mid-2020, which will likely fuel a boost in e-commerce activities. The report also found that trade activity has rebounded more quickly than expected since the spring, reaching only 3-4% lower than its pre-covid levels. While this could be a temporary phenomenon due to restocking, HSBC expects global trade to rebound in 2021, with some adjustments to supply chains as companies look to hedge against future risks by expanding to multiple bases and sourcing more of their materials locally.

For emerging markets like Egypt, a deglobalized economy could impose serious limitations on growth, particularly for industries that are heavily reliant on imported materials. The global export to GDP ratio had already been declining, falling 5% from the global financial crisis in 2008 to 2020, and indicating a regression in trade-linked growth. This could inflict a heavy blow on developing economies playing catch up with their Western counterparts by relying on export-led growth. On the other hand, AUC’s Sherif Kamel writes that deglobalization could present an opening for Egypt’s manufacturing industries as regional businesses look for suppliers that are closer to end markets, allowing Egypt to act as a gateway to Africa and to entrench itself more firmly in regional supply chains.


CIB now fits in your pocket to help you manage all your financial needs.

CIB is advising all its customers to stay at home whenever possible, to help slow the spread of covid-19.

In these unusual times, the safety and wellbeing of our customers is our top priority. Our mobile banking app makes it easy for you to manage all your banking needs from the comfort and safety of your home.

Mobile banking is the easiest and most convenient way to conduct all your banking transactions. Whether you’re transferring money to another account, checking your balance, instantly settling your credit cards, scheduling transactions or undertaking any other aspect of your banking experience, you can do it all with our updated CIB app.

We’ve designed a smooth and easy customer experience that includes fingerprint login and in-app registration to make it straightforward for you to get started. You can select your preferences, including the default account you want to view first and the default currency you want to view your money in, and you can easily change the language and password through the app.

Everything can be done securely and at your convenience from your home, whatever your banking needs.

To get started: Download the CIB Mobile Banking application from the App Store or Play Store for free. Login directly using your Internet Banking credentials or register as a new user with your debit or credit card.

For more information: Please visit the CIB website.

Terms and conditions apply.


Your top 5 pieces of business and economic news in December

Your top 5 pieces of business and economic news in December:

  • Sentiment: We received contradictory data points on business sentiment last month, with an HSBC survey indicating confidence heading into 2021 but November’s PMI had only 12% of firms forecasting growth next year due to uncertainty caused by the pandemic.
  • Inflation: Headline annual inflation hit a five-month high in November driven by a rise in food prices.
  • Privatization: Five companies have been earmarked to restart the state privatization program in the coming months, Public Enterprises Minister Hisham Tawfik said, a week after the Sovereign Fund of Egypt announced the first two military-owned firms to be offered to investors.
  • Banking: The banking sector should prepare for a rise in bad loans in 2021 but most remain sufficiently capitalized to weather the storm, analysts said.
  • Tax: Some 11k large and medium-sized firms will begin using the unified tax platform on 1 January as the government begins to trial the new system.


Post-2020 travel

One of the first and hardest-hit industries by the pandemic has been travel. As worldwide lockdowns grounded business and leisure travellers alike, the sector may be undergoing permanent changes as people rethink flight safety, business travel, and their holiday destinations of choice.

We might need an immunity passport to travel: The future role of “immunity passports” — a certificate proving that you’ve been vaccinated against the coronavirus — may well become a necessity for future travellers. The airline industry, decimated by the pandemic, has become a vocal supporter of the idea. The industry’s global trade association, the International Air Transport Association, is working to introduce a similar sort of scheme dubbed the Travel Pass Initiative, which would enable governments to share testing and vaccination information and travellers to use an app to verify they have been tested and vaccinated against the virus.

For now it remains unclear how widely adopted immunity passports will become. The World Health Organization has delivered confusing messaging on the subject, saying they won’t be recommending them while collaborating with countries such as Estonia to set up their own program. Airlines will no doubt require them regardless of departure point and destination while rights groups have raised issues over data privacy, and called for providers to build protection into the technologies. It is also likely that the market will fragment as the IATA and others join travel health app CommonPass, a pioneer in the field that displays whether users have tested negative for covid-19.

The future of business travel is up in the air: If nothing else, the pandemic has taught professionals the expediency of a video conference over a long-haul flight for business meetings. While the chiefs of major airlines optimistically claim international business travel will return to normal, other prognosticators like Bill Gates say nearly half of it will remain a thing of the past. A WSJ analysis with industry experts suggests anywhere between 19-36% of air travel simply won’t be coming back. Business travel has a history of slower recovery than leisure travel after economic downturns, with regional travel and in-person client meetings returning first. Unfortunately, fares for corporate travel subsidize leisure travel, so the pain felt by one will impact the other.

Staycations could be here to stay: Booking firms are already adjusting to a new reality where holidaymakers are less likely to look to far-flung corners of the world for their holidays in favor of destinations closer to home. Most people in the US are opting for vacations at home, holiday booking sites in the UK have seen a surge in searches for domestic destinations, and the Australian hospitality industry has received plenty of new business from locals forced to cancel overseas holidays. Some are turning to local wellness trips and engagement with local communities, and purposeful skill learning during time off is also on the rise, and the environmental consciousness of these efforts is an added bonus. So dig out that local map, and find that gem that’s just around the corner.


Covid may have sparked a fintech revolution

2020 was the year e-payments went mainstream: Central bank data from around the world has shown the pandemic has coincided with a strong increase in the use of a range of fintech products. The use of digital payments and remittance transfers, digital savings, deposits and lending, and so-called InsurTech have all surged this year, a survey of regulators by the University of Cambridge Judge Business School and the World Bank. The poll of almost 1.4k fintech firms in 169 countries showed digital payments volumes increased by an average 13% and wealth management services up 11%. The Middle East saw the strongest growth, up 40% on average.

The pandemic might have been what was needed for Egypt’s financial inclusion plans as Egyptians became much more fond of everything electronic. In Egypt, policymakers have been pushing for financial inclusion for several years, and the pandemic seems to have given their initiative a shot in the arm. The number of mobile wallets in Egypt jumped at least 17% between March and October, CIB saw a 100% y-o-y increase in the number of internet and mobile banking transactions in a single month, and the number of Egyptians shopping online broke records.

Regulators around the emerging world moved fintech higher on their agendas: Nearly two-thirds of EM regulators now view fintech as a priority, and over half of the advanced world’s policymakers say the pandemic has provided further impetus to the pre-covid trend towards digital payments, the study found. More than three-quarters of central banks in emerging markets (81%) and 70% of banks in advanced economies see it as positive for advancing financial inclusion objectives. On the flipside, the growth of fintech is likely to invite a lot more scrutiny from policymakers concerned about its potential to facilitate money laundering and cybersecurity.

Is covid accelerating the push towards national digital currencies? Since the pandemic, we’ve also heard of at least three plans to accelerate the launch of national digital currencies. China is, at the time of writing, continuing to trial its digital yuan and plans to become the first country in the world to roll out a virtual currency. The European Central Bank has also floated around the idea of a digital Euro, with ECB President Christine Lagarde in October saying the pandemic has shifted how "we work … trade, and … pay." Russia also announced recently it’s considering launching a digitized ruble.


Changing the way we think about education

Education without schools: This year has been a challenge for students, teachers, and parents as the pandemic caused perhaps the biggest global disruption to education ever. More than 1.5 bn children lost out on valuable teaching time as schools closed, forcing education leaders and teachers to get creative with new technologies, and governments to accelerate investment in digital infrastructure to keep curriculums on track.

It’s not just the medium that may change: We’ve written a lot this year about how technology may make brick-and-mortar schools less essential to the learning process (see the entire October Your Wealth issue, for instance). But the pandemic may also encourage other fundamental changes to the education system, more indirectly influenced by technology.

Sami Nassar, a professor at the National Egyptian E-Learning University, says the crisis only makes it more important for policymakers to shake up the subjects we teach to our children. Speaking during a UN event (pdf), he called on Arab governments to place far greater emphasis on digital literacy and teaching advanced technological skills that will be vital to the so-called Fourth Industrial Revolution.

Teachers may face an identity crisis: Rising technology also means teachers will need to rethink their roles as educators as more students than ever access knowledge with a click of the button. Instead, teachers will need to teach children skills to navigate the huge amount of information they meet through skills such as critical thinking, debating, and responsibility.

There could be many left behind in a future of digital learning: Remote education requires things that may not be readily available in many families: access to a machine and suitable supervision, preferably in a quiet, undisrupted place. Technology is not equally distributed on a global or local scale and in many domestic situations parents might not be able to afford staying at home with their children. Although 2020 has seen a significant expansion of edtech in Africa, only 19 mn of the continent’s 450 mn children are actually using it, and the majority of these are watching TV shows. In Egypt, only around 8 mn people are subscribed to ADSL services out of a population of 100+ mn and many children in rural areas don’t have access to a laptop or tablet to attend lectures.

The silver lining: An increasing digital divide could put pressure on policymakers to increase spending on education, providing rural communities the digital infrastructure they need to access remote learning resources.

Let’s not forget the benefits of the classroom: Positives of distance learning aside, children are losing out on valuable social experiences that they would get in a physical classroom. Face-to-face interactions influence a child’s performance, morale, and productivity and sitting in front of a screen all day for education and leisure could have a negative impact on their development. Distance learning can never fully replace the physical classrooms. Schools are much more than places for learning. They provide social networks, safety and well-being for children and youth,” says Finland’s education Minister Li Andersson.

The classroom isn’t about to become a relic of the past: This goes to show that, while technology may provide better pedagogical tools and easier access to information, it’s hard to imagine that schools will face an existential crisis any time soon. Rather, most of us are likely to settle into a new reality of blended learning, with technology playing a greater supplementary role to in-class learning.


Covid helped get healthcare out of hospitals

Healthcare without hospitals: The pandemic is likely to accelerate the global shift to take healthcare out of its traditional setting. The covid-19 experience unmasked major deficiencies and inflexibility in our facility-based healthcare system, and is allowing providers to reimagine and transform how we receive care to rely more on technology and advanced logistics.

Telehealth: Around the world and right here in Egypt, the pandemic has fueled the emergence of telehealth services which allow patients to receive diagnosis over a phone call with a doctor and in some cases get the medicine delivered to them at home as well. McKinsey research shows that telehealth providers have seen patients increase 50-175x in the US since the beginning of the pandemic, potentially leading to USD 250 bn of revenues in the future.

Artificial intelligence, point-of-care diagnostics, and wearable biometric monitoring: These core technologies will help transport healthcare outside of the hospital, make it more affordable, and pave the way for faster detection. AI will help to democratize medical care by using large amounts of patient data and best-practice evidence to guide diagnosis and treatment. Point of care diagnostics using biochips or other technologies facilitate better disease diagnosis, monitoring, and management, reducing costs and accelerating access to appropriate treatments. And wearable biometric monitoring devices will allow patients and medical providers to remotely monitor their medical status, allowing for safe medical care at home or in other decentralized care sites.

Let’s talk Egypt: Covid-19 has shown that changing societal, environmental, demographic, and technological patterns are straining global health systems capacity and running the risk that they become unfit, Egyptian doctor Mohamed Kamel writes in the Alexandria Journal of Medicine. Kamel says that integrating more digital technologies such as telehealth, mobile apps, sensors, and rehabilitative robotics into the country’s healthcare system will be critical in addressing health challenges coming out of the pandemic. The use of technology is just a part of a large-scale plan by Kamel to overhaul the country’s healthcare system, which would see more financing, an end to market fragmentation, and a rethink of how medical staff are taught and trained.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.