Tuesday, 25 November 2014

New driving fines take effect today • World Bank report: Egyptian crop yields could plunge by up to 30% by 2050 • Mobily chief’s suspension makes global headlines, Hagel’s replacement crucial for Egypt • Korea to attend Sharm summit


Drive the wrong way down the street starting today (or under the influence of drugs or alcohol) and you’ll face up to three years in prison, a fine of up to EGP 20,000 and revocation of your license as new legislation passed by President Abdelfattah El-Sisi takes effect.

Today marks the first of the two-day MEED Invest in Egypt 2014 Conference in Abu Dhabi. The gathering is set to serve as a roadmap builder for the March 2015 Sharm El-Sheikh investment summit.

The nomination process to replace outgoing US Secretary of Defense Chuck Hagel will be of critical importance for US-Egypt relations (more below).

With the Pope now behind him, President Abdelfattah El-Sisi gets down to brass tacks on his four-day swing through European capitals. Ahram Online has a rundown from two former diplomats on what’s likely on the agenda. Looming large: Egypt’s economy and Libyan security, particularly after Omar Al-Hassi, the leader of Liby’a self-proclaimed Islamist government, declared “war” last night on forces of the elected government now based in Tobruk following an attack on the capital city’s sole functioning airport. (See Ahram Online or check out Borzou Daragahi in this morning’s FT; meanwhile, Reuters has a brief report on the airstrike)

We had rain yesterday (ie: we had weather for a change) and the Meteorological Authority says there’s a chance of showers today, regardless of what the Weather app on your iPhone might say.


Two events of note for tomorrow:

  • The National Independent Committee for Fact finding on 30 June will hold a Press Conference at the People’s Assembly Shoura Council at 10:00 am CLT
  • Deadline for receiving first round pre-qualification documents for Egyptian Electricity Holding Company tender for solar or wind power projects up to 50MW. Pre-qualification documents can be sent tofitunit@moee.cloud.gov.eg

This is the Thanksgiving long weekend for our American readers, be they in Cairo or the United States. Expect relative quiet on Wall Street this week, barring exogenous shocks.


Two Google engineers detail their work on the now-cancelled RE<C project, a Google initiative that ambitiously aimed to do nothing short of developing renewable energy that would generate electricity more cheaply than coal. In 2011, the project was cancelled. Their conclusion: incremental improvements to currently existing renewable energy will not be sufficient to replace cheaper non-renewable sources and that what is needed is new, disruptive technologies. The article has some shortcomings, namely that their baseline assumptions disregard nuclear fission, and that they refused to incorporate the possibility of subsidies in their models, with the latter being a driver in both renewable energy adoption and the driving down of costs. Still, their arguments regarding how R&D should be allocated for energy research bears consideration. (Read)

Meanwhile, The World Bank has released a 320-page report, the second of a two-volume work titled: Turn down the heat: Confronting the new climate normal. The report projects: “In Jordan, Egypt, and Libya, crop yields could decrease by up to 30 percent at 1.5 to 2°C warming by 2050.  Migration and climaterelated pressure on resources may also increase the risk of conflict.” (Download the report as a pdf here)

While we’re on the topic of climate change in Egypt, take a look at the very polished website for the National dialogue on climate change in Egypt:http://egyptclimatechange.net/. The site identifies itself as an initiative of the Friedrich Naumann Foundation for Liberty, which is itself associated with the center-right Free Democratic Party of Germany.

Finally: The EGX-listed companies serve as fodder for a study on how protests influence the swings of stock markets in a working paper released by the US National Bureau of Economic Research. The basic premise: “Street protests … play[ed] an important role during [the 2011-2013] power struggle. We show that these protests are associated with differential stock market returns for firms connected to the three groups: Elites associated with Mubarak’s National Democratic Party (NDP), the military, and the Islamist Muslim Brotherhood.” The piece is written up in today’s FT, or the more academically inclined among you download the 70+ pp working paper in pdf format here; we’re still digesting it here at Enterprise and will let you know if there’s more.


The most relevant commentary on last night’s talk shows came from Ibrahim Eissa, who expressed his deep concern regarding the performance of the government as of late. He takes the draft anti-terrorism law as an example of what he sees as the government’s inability to draft and implement in a timely manner legislation that really tackles the nation’s problems.

Eissa pointed out that the Deputy Head of Al Azhar, Sheikh Abbas Shuman, was a member of the committee reviewing the law with the Prime Minister, then alleged: “Are they not aware that Shuman was a staunch Morsi supporter who defended the former president’s right to stand above the law?”

Eissa aired of video of a sermon Shuman gave during Morsi’s presidency in which the latter equates the presidency with an Islamic Caliphate.

“If you really believe that the government is capable of combating terrorism, then you should check yourself into a mental institution,” said Eissa. “If this is the best effort of government that claims to be working 24-7 then we have a serious problem,” he adds.

Youssef El Housseiny continued to carry the anti-government torch with complaints over both Shuman and Mahmoud Shaaban, the recently suspended Azharite Sheikh whose sermons allegedly incited violence.

El Housseiny hosted Magda Shehata Haroun, head of the Jewish community in Egypt, and Amir Ramses, the director of the two-part documentary “The Jews of Egypt.”

“There are eight Jews left in Cairo and three in Alexandria,” said Haroun, who went on to discuss the history and experiences of Egypt’s Jewish population.


Egyptian and regional markets closed down for the most part on Monday, with the EGX30 dropping 1.27% to close at 9,156 points on turnover of EGP 681 mn, about 11% below the 90-day average. The DFM and the Qatar Exchange both closed down, by 4.37% and 1.21% respectively. The Saudi Tadawul dropped 1.17%, while Kuwait was the biggest gainer in relative terms, adding 0.74%. The ADX was essentially flat, up 0.02% for the day.

At the risk of being monotonous: US markets closed Monday in record territory once more. The Dow Jones posted its 29th record close of the year, with the S&P 500 posting its “best-ever finish” for the 46th time in 2014. The Nasdaq also closed in the black yesterday. US markets are broadly expected to be quiet this week in the run-up to the Thanksgiving long weekend.

Asian markets were all net gainers yesterday, led by the Shanghai Composite up by 2.55%, the Hang Seng by 1.95% and the Nikkei by 0.33%. Markets and oil were both down in Asia at the start of trade this morning.

Brent crude held steady yesterday, bolstered by Russia’s bid to convince OPEC to cut supplies at its 28 November meeting by pledging a cut of up 300,000 barrels per day. The extension of nuclear talks with Iran also provided support. (Read)

US President Barack Obama was due to soon address his nation as we prepared for dispatch this morning after a grand jury in the US state of Missouri declined to indict a white policeman for the shooting death of an unarmed black teenager.

U.S. Secretary of Defense Chuck Hagel has resigned after having served only two years of his four-year term, with most headlines suggesting that Hagel was forced out by Obama – NYT: Hagel submits resignation as defense chief under pressure, WaPo: Defense Secretary Hagel, under pressure, submits resignation, and the UK’s The Guardian: Chuck Hagel forced to step down as US defense secretary. The move was unexpected by many, considering as the NYT notes: “… Mr. Hagel’s aides had maintained in recent weeks that he expected to serve the full four years.”

Why do we care? Hagel “got” Egypt: Dov S. Zakheim at FP’s Shadow Government page (the section that often makes more sense than the rest of the site) had this to say in praise of Hagel’s performance with regard to Egypt: “Where Hagel was given some leeway, he performed far better than many pundits anticipated, and for which he has received little credit … Hagel also kept lines open to the Egyptian military even as the White House was making a hash of American relations with Cairo. His ability to reach out to Abdel Fateh [sic] el-Sisi made all the difference when the general assumed the presidency of his country. Egypt is still the most important country in the Middle East, and Hagel deserves most of the credit for preventing the complete rupture of ties with Cairo.” (Read “What Hagel got right“)

Chief executive of KSA’s Mobily is suspended as accounting scandal deepens, spreads into international press. Khalid Al-Kaf was sidelined after nine years on the job, replaced by his deputy. Mobily, the kingdom’s second-largest operator (27.5% owned by the UAE’s Etisalat), restated its earnings earlier this month, suggesting that accounting errors were behind the wipe-out of some SAR 1.42 bn (c. USD 380 mn) in previously reported profits. The company’s audit committee is investigating. The FT takes pains to note that the apparent scandal comes as KSA prepares to open to foreign investors for the first time in 1H2015. Our take: The reporting of the issue is a significant break with common practice in KSA, where opacity in the boardroom has historically been the order of the day. We expect Etisalat (under pressure from KSA regulators) will make the results of the investigation public in one form or another. (Read more on Bloomberg orReuters or in the FT)

The spokesperson for Abdel Moneim Aboul Fotouh’s Strong Egypt Party says they will not participate in 28 November protests. Not that anyone on either side of the political spectrum particularly thought their views on the Salafi-called demonstrations relevant in the first place (read in Aswat Masriya). Likewise, the Nour Party have also announced their rejection of the demonstrations, with their members in Suez forming a human chain of what appears to be two people to protest the protest (Read).

Erdogan not interested in reconciliation with Egypt a la “Qatar and the GCC”. A report in Turkish media says that Turkish President Recep Tayyip Erdogan continues to grumble that despite the intercession of “friendly nations,” he has no plans to reconcile with President Abdelfattah El-Sisi. We’ll spare you the quote. Suffice to say, he doesn’t want to come over for a playdate anytime soon. (Read)

Affordable Internet access as a human right: More than 90% of Egyptians see internet access as a human right, against just 77% of Americans, according to a survey released yesterday by Canada’s Centre for International Governance Innovation. Egyptians were joined by Chinese, Tunisian and Indonesian respondents in their near-unanimity that affordable access to the internet should be a “basic human right,” the poll of respondents in 24 countries found. (Read the survey results and, while you’re there, check out the downloads)


Calling it “rare good news” on his Twitter feed, the FT’s Borzou Daragahi files “Tourists return to Egypt after 3-year break,” quoting Hilton Hotels VP Egypt Operations Christian Muhr as saying: “The overall sector has seen a remarkable recovery in the second half of 2014, especially during holiday seasons in the beach resorts. The forecasts for 2015 are promising as well.” (Hlton operates 18 properties in Egypt.) Daragahi quotes a random UK tourist at the Egyptian Museum as saying, “The stay has been good so far. We’re feeling safe. There is lots of security everywhere,” explaining that Italy, Belgium and Germany (the second-largest exporter of tourists to Egypt after Russia) have all lifted or relaxed travel warnings. From 10-20% a year ago, occupancy rates in Cairo are now hitting 50%, which EFG Hermes analyst Mohamed Abu Basha calls the “interesting development” in the story. The kicker: “If the improvement can be sustained, Capital Economics, the UK-based consultancy, estimates that it might generate an additional $3.3bn, or 1.2 per cent of gross domestic product, over the next year.” Read the piece, with quotes from Minister of Tourism Hisham Zaazou.

The AP’s lede on yesterday’s Sisi-Francis meeting: “Pope Francis and the Egyptian president exchanged warm greetings during a private meeting Monday in which the pontiff emphasized Egypt’s role in establishing peace in the Middle East.”

Added AFP: “Pope Francis urged [El-Sisi] on Monday to ensure peace during his country’s political transition and called on Egypt to embrace its diplomatic role in the troubled Middle East. During what the Vatican described as ‘cordial’ talks … the pontiff stressed ‘the closeness and solidarity of the Church to all the people of Egypt during this period of political transition.’”

Chinese news agency Xinhua has distributed through the Global Post a positive take on the 16th Conference of Arab Businessmen and Investors,noting improved investment sentiment surrounding Egypt: “Many Arab and foreign investors have already started large businesses in Egypt in recent months,” Saudi Arabian investment advisor Hamza Awon told Xinhua. “I believe that Egypt will return as a key investment hub for foreign and regional investors.” (Read)

Amnesty International is observing 16 Days against gender violence by focusing on five jurisdictions, one of which is Egypt. The campaign pageoffers what they say is a link to a form letter addressed to President Abdelfattah El-Sisi “demanding that the authorities implement a strategy to combat sexual violence and discrimination in full consultation with women’s rights groups.” The link, however, didn’t work last night or at press time and instead directs to a month-old press release about the imprisoned Egyptian lawyer and activist Yara Sallam. The form letter is nowhere else to be found on the website.


Al-Kharafi, El-Sewedy Electric and Onera Systems discuss investment opportunities in the energy sector
Al Mal | 23 Nov 2014
Al-Kharafi National, ElSewedy Electric and Onera Systems examined investment opportunities in Egypt’s energy sector during the 16th Arab Business Owners and Investors Conference that took place on Sunday. The conference served as a hub for showcasing possible investment opportunities in Egypt. The article mentioned that there were complaints that only Arab and Egyptian investors were invited to attend the conference. (Read in Arabic)

Bank Misr and Onera Systems sign MOU for financing renewable energy projects
Youm7 | 23 Nov 2014
Onera Systems and Misr Bank signed a Memorandum of Understanding to finance solar power systems. The move follows the government’s new solar energy feed-in tariff law in September. The bank said in a statement that it will offer several financing programs for individuals and businesses who are interested in investing in new and renewable energy. (Read in Arabic)


In our lead story in Oil and Gas in yesterday’s edition of Enterprise Morning Meeting, we mis-identified the President of BG Egypt. He is Arshad Sufi, not Ashraf Sufi. We apologize for the error.

Political instability did not impede oil and gas FDI – ERF
Daily News Egypt | 24 Nov 2014
An Economic Research Forum (ERF) paper showed that oil and gas FDI in Egypt was not impeded by the political instability the country has endured. Despite the uncertainty, companies like Dana Gas and ENI announced major investments as the sector was shielded due to the nature of its operations that are usually located far from hotbeds of unrest. Other sectors, however, were significantly affected by the political unrest and saw a marked decrease in FDI. (Read)


Arabian Cement’s 9M 2014 profit drops due to energy crisis; Al Mal misstates figures
Al Mal | 23 Nov 2014
The Arabian Cement Company, a leading Egyptian cement producer, reported its consolidated results for the first nine months of 2014, Al-Mal says. Revenues in the period rose 17% to EGP 1,788.5 mn as compared to EGP 1,532.1 mn in 9M 2013, on what management believes are early signs of recovery in both the economic and security situation in Egypt. According to Al Mal, net profits dropped 17% on the back of fuel shortages. However, according to the release by Arabian Cement, Net Profit dropped 35% y-o-y to EGP 200.4 mn, while Net Profit Margin was down 9 ppt to 11% on the combined impact of the expiration of the company’s tax-exempt status — ACC is now taxed at the newly increased corporate rate of 30% —  and non-recurring expenses associated with ACC’s listing earlier this year on the EGX. “Fuel shortages in the first nine months of the year led to a 20% y-o-y drop in clinker production and a 62% utilization rate of those facilities as compared to 9M 2013,” according to CEO Jose Maria Magrina. (Read in Arabic in Al Mal)

KIMA to raise its capital to EGP 1.97 bn
Amwal Al Ghad | 23 Nov 2014
The Egyptian Chemical Industries Company (KIMA) announced on Sunday that it will hold an extraordinary general assembly meeting on 8 December to vote on increasing its issued and paid in capital by EGP 80.142 mn to EGP 1.97 bn. KIMA’s current issued and paid in capital stands at EGP 1.89 bn divided over 378 mn shares with a par value of EGP 5/share while its market value stands at some EGP 3 bn. The company posted a net profit of EGP 15.1 mn in the first quarter of FY2014/2015, up 83.5% from the same period last year. (Read in Arabic)


AbbVie Pharmaceuticals launches operations in Egypt
Al Mal | 23 Nov 2014
In a press conference attended by investment minister Ashraf Salman and health minister Adel Adawi, AbbVie announced the beginning of research and development operations in Egypt. AbbVie awaits final approvals to launch its treatment for chronic Hepatitis C virus domestically. (Read in Arabic)


Amer Group land bank could deliver sales of EGP 40 bn; company receives license for Porto Dead Sea
Al Mal | 23 Nov 2014
Amer Group Chairman and Founder Mansour Amer was quoted as saying at a press conference on Sunday that the company could generate sales of up to EGP 40 bn from its present land bank. Amer Group announced during the press conference that it will spin-off its real estate business into a separate entity, Porto Holding, while the remaining lines businesses (hotels, malls and restaurants and new ventures) will continue under the Amer Group’s umbrella.

A second piece in Al-Mal notes that the group has received the license for its Porto Dead Sea project in Jordan, announced Mansour Amer, Chairman and founder of the company, who noted noted that the company has already begun excavation and earthworks on site after receiving the go-ahead from the Jordanian government. (Read the EGP 40 bn in sales value story in Arabic or Read the news from Jordan, also in Arabic)

Icon Egypt Submits Capital Increase Application to the Egyptian Stock Exchange
Mubasher | 23 November 2014
Developer and corrugated steel manufacturer Icon, has applied to raise its issued capital by EGP 36 mn to reach EGP 107 mn. Icon’s current issued capital stands at EGP 71 mn divided over 17.8 mn shares with a par value of EGP 4 per share. The capital increase will be financed from the company’s retained earnings and will see the issuance of one free share for every stock owned. (Read in Arabic)


Atef Helmy: Ministry aims for USD 10 bn of investments in the sector
Amwal Al Ghad | 24 Nov 2014
Minister of Communications and Information Technology Atef Helmy said his ministry is targeting a total of USD 10 bn of investments in the sector over the coming four years. Helmy stressed that the ministry’s strategy for the coming period will focus on the development of human resources as well as injecting new investments in technology across six governorates.  (Read in Arabic)

Vodafone Egypt secures EGP 4 bn line of credit
Zawya | 24 Nov 2014
Vodafone Egypt secured EGP 4 bn in credit facilities from seven banks including CIB, Barclay’s, Emirates NBD Egypt, Banque Misr, Alexandria Bank, HSBC and QNB. The line of credit will be used to cover the costs of refurbishing network infrastructure and would also provide needed liquidity in case Vodafone decides to bid on new licences, such as the new Unified Telecoms License. (Read in Arabic)

Background from Enterprise: The long-awaited unified telecoms license package covering mobile and fixed-line services will be issued before year’s end, as we have previously reported. The license terms would permit Telecom Egypt to enter the mobile space in return for a one-time payment of EGP 2.5 bn, while Vodafone Egypt, Etisalat and Mobinil could each begin offering fixed-line service by paying EGP 100 mn to state coffers for access to TE’s existing network. The license would also spin off a new company to develop national telecoms infrastructure, a function now carried out by TE and select military-owned companies.


Abu Dhabi’s Khalifa Fund to extend USD 200 mn in financing for microfinance ventures
Reuters | 24 Nov 2014
Abu Dhabi’s Khalifa Fund for Enterprise Development is looking to help create 100,000 small ventures and more than 120,000 jobs by 2020 through the extension of some USD 200 mn in financing to Egypt’s microfinance sector, according to a company statement. The loan agreement was signed with the Sisi administration yesterday, the story says, without explaining who the signing party was and whether the financing will flow into public or private-sector microfinance providers. (Read)

Beltone Financial to issue a one-for-two stock dividend, raise capital
Reuters | 24 Nov 2014
Beltone Financial unveiled a plan to give out a one-for-two stock dividend as an initial part of a two-stage plan to increase capital of to EGP 242 mn. Initially, shareholders approved a capital increase to EGP 41.83 mn on Sunday. The capital increase will be used to fund growth in the financial services business. “We are targeting completion of the (first phase of the) capital increase … within two to three weeks from now,” Osama Rashad, head of investor relations at Beltone, told Reuters. (Read)

Al Baraka Bank’s net income grows by 41%
Zawya | 24 Nov 2014
Al Baraka Bank’s net income grew by 41% to EGP 168 mn in the first nine months of 2014. The bank’s CEO emphasised the expansion of the retail network to reach 28 branches, with three more under construction. (Read)


Talks between Maersk’s SCCT and Sisi administration on USD 1.5 bn East Port Said Port concession to kick off in December
Reuters, Aswat Masriya | 24 Nov 2014
As we reported a week ago yesterday, the Sisi administration is in talks with Maersk-owned Suez Canal Container Terminals (SCCT) on a USD 1.5 bn agreement to extend SCCT’s management of a port near the entrance to the Suez Canal. An advisor to the transport minister said talks in December would focus on a 14-year extension for the East Port Said Port concession. A follow-on story by Reuters-backed Aswat Masriya has now been picked up by Reuters itself and is making wide headlines. It is by-and-large neutral, noting that SCCT could be exempted from rent and other fees if it builds a USD 80 mn pier, while SCCT wants to use a side channel to give smaller container ships direct access to East Port Said Port away from the entrance to the Suez Canal to widen the window in which the smaller vessels can dock. SCCT also wants to deepen the main port, but has been told it must wait for construction work on the New Suez Canal is finished. (Read on Reuters or Aswat Masriya)

Salman: EGP 280 bn in new private sector investments in 2014/15
Mubasher | 23 Nov 2014
The Egyptian private sector will likely receive investments up to EGP 280 billion, driving the growth rate to the target set by the government of 3.8% during the fiscal year 2014/15, announced Ashraf Salman the Minister of Investment during a press conference. (Read in Arabic)


South Korea to attend March investment summit, Sisi to visit Seoul
Office of the Presidency | 24 Nov 2014
Following Prime Minister Ibrahim Mehleb’s meeting his visiting South Korean counterpart Jung Hong-won on Sunday, the Office of the Presidency announced in a statement that South Korea will be participating in the investment summit in Sharm El Sheikh this March, and that the country looked forward to President Sisi’s visit to Seoul next year to commemorate 20 years of friendly relations between the two countries.

Minister of Transitional Justice to announce new legislation to facilitate corporate establishment
Ahram Gate | 23 Nov 2014
It looks like Investment Minister Ashraf Salman is getting a hand from the Minister of Transitional Justice: Counselor Ibrahim El-Heneidy has said that a “supreme committee for legislative reform” formed to review suggestions for urgently required legislative reforms will review all legislation pertaining to the investment climate with a view to slashing hoops through which one must jump to form a new company. (Read in Arabic)

Managing Director of Qalaa Holdings asks for specialized economic zones
Al Masry Al Youm | 23 Nov 2014
Much-needed restructuring and streamlining of Egypt’s administrative and legislative system will take time, referring to successful examples in countries like China, said Hisham El-Khazindar, Co-Founder and Managing Director of Qalaa Holdings, during the 16th Arab Business Owners and Investors Conference. El-Khazindar suggested the should legislate specialized economic zones around large projects such as the Suez Canal corridor. This could serve as way to create a one-stop-hub for all necessary bureaucratic measures for investments of EGP 1 billion or more. The remarks were widely picked up in the Egyptian press.

Hiftar says Egypt’s support to Libya is limited to logistics
Al Masry Al Youm | 23 Nov 2014
In an interview with Algerian daily Al Shorouk, Libya’s general Khalifa Hiftar echoed what Egypt’s president al-Sisi said at his France24 TV interview and denied that Egypt intervened militarily in Libya. General Hiftar says Egypt’s support to his forces is limited to logistics, supplies, and administration. (Read in Arabic)

Presidential decree outlines new traffic rules
Masrawy | 24 Nov 2014
President Abdelfattah El-Sisi issued a new decree (142 / 2014) imposing harsher punishments on motorists who drive under the influence of drugs and alcohol as well as driving in the wrong direction. According to the the new decree that will take force on 25 November 2014, drivers who break the above-mentioned traffic laws will face 1-3 years in prison, be fined EGP 10,000-20,000 and lose their licenses for an indeterminate period. (Read in Arabic)


Tunisia’s presidential elections appear to be heading to a runoffbetween Nida Tounes’ Beji Caid Essebsi and President Moncef Marzouki. Turnout was at 65%, the state-run TAP news agency reported, citing elections commissions chief Shafik Sarsar. (Read)

Nuclear talks with between Iran and the “P5+1” were extended until July after the two sides failed to reach a resolution yesterday in Vienna. Iranian President Hassan Rouhani said “many gaps were narrowed and our positions with the other side got closer,” while US Secretary of State John Kerry added that while “real and substantial progress had been made … some significant points of disagreement” were left on the table. (Read in the Globe and Mail)

Saudi security forces arrested 77 yesterday in connection with a terror attack that left eight dead and 13 injured in the village of Dalwa (in the oil-rich Al-Ahsa area) earlier this month. The suspects were allegedly in contact with Daesh, according to an Interior Ministry spokesman. (Read in the Kuwait News Agency or the WSJ)

In an interview with Fox News, the UAE’s foreign minister warned that Libya is becoming a “huge ticking bomb” for the Middle East. He believes NATO forces should have played a bigger role in Libya after ousting Qaddafi. (Read)

THE ENTERPRISE BRIEF: Egyptian exports to Italy

Egyptian exports fell by 3.10% y-o-y from USD 13.38 bn to USD 12.96 bn in 1H2014, according to CBE data. Even though the country imported 22.0% more raw materials and intermediate goods, the primary inputs were mostly utilized domestically as an uptick in non-oil manufacturing and construction increased their proportion in 1H14’s GDP to 16.37% and 4.92% respectively from 14.79% and 4.77% in 1H13.

As domestic manufacturers regain a sense of stability with fuel and energy supplies becoming more reliable and predictable, exports are expected to increase in FY 2014/15.

For the most part, Egypt’s production that is shipped overseas ends up on EU shores, with Italy remaining the largest international market for Egyptian producers with 15.6% (USD 4.02 bn, a 15.7% y-o-y growth) of all of 2013/14’s export proceeds. Since 2007, the portfolio of the products ending up on the Italian market has remained largely unchanged with around 60% of the Egyptian exports being petroleum-based products and, to a lesser extent, metals (aluminum and steel) with the proportion of former growing at a more rapid pace.

The Italian business community’s palpable interest in Egypt was noted by the Bank of Alexandria’s CEO (a subsidiary of Intesa San Paolo) who mentioned that EUR 50 mn are about to pumped into Egypt by an Italian solar panel manufacturer – a story we covered in yesterday’s issue of Enterprise.


Minister of Investment Ashraf Salman invited representatives of leading Egyptian investment banks to a meeting with representatives from Lazard to discuss their role in Egypt’s Investment Summit and listen to their views about any potential obstacles that could face the marketing of investment opportunities in Egypt. (Read in Arabic)

Americans (younger ones, at least) are developing taste when it comes to beer: More Americans now drink craft beer than swill Budweiser, the WSJ reports in its look at how  Anheuser-Busch InBev NV is coping with the fact that “44% of  21-to-27-year-old drinkers today have never tried Budweiser.” Read in the WSJ or see how Slate runs with the piece (no pay wall).

That nasty piece of malware we mentioned yesterday named Regin? The Intercept has come down decisively on the side of it having been crafted by US and British intelligence after obtaining and analyzing samples in a cool (and, in the second half of the piece, intensely technical) dissection of Regin’s code. (Read “Secret malware in European Union attack linked to US and British intelligence“)

Egypt invented state-funded healthcare. That’s the claim advanced by Stanford University archaeologist Anne Austin, whose research suggests Egyptian workers in the Valley of the Kings had access to state-funded healthcare c. 1550-1080 BC: “By analysing skeletal remains of the people who lived in Deir el-Medinaand looking at written artefacts, Anne Austin has discovered that the Egyptian workers were permitted to take sick days and could visit a “clinic” for free health check-ups.” (Read)

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