Sunday, 7 December 2014
The pound was steady against the greenback at Thursday’s dollar auction, holding at 7.1401 to the dollar. In the parallel market, the EGP gained a bit of strength, trading at 7.65 compared with 7.67 the day before, according to a trader contacted by Reuters.
WHAT WE’RE TRACKING TODAY
Talks on a COMESA-EAC-SADC free-trade agreement have been postponed to 1Q2015, a public relations officer from the COMESA Secretariat confirmed to Enterprise on Thursday. The talks were originally scheduled to take place in Cairo by mid-December, according to earlier reports. A separate source with knowledge of the proceedings on the Egyptian side says the gathering will take place Egypt in February. The talks, which began in 2008, seek to establish a common free trade area covering 26 of Africa’s 54 countries. Stay tuned for updates.
Egyptian banks will begin paying out the first quarterly interest payment to New Suez Canal bondholders today (Sunday) with the CBE allocating EGP 1.9 bn for the payments. Egypt facs annual interest payments to bondholders in the neighborhood of EGP 7.7 bn. (Read in Arabic)
WHAT WE’RE TRACKING THIS WEEK
The North Africa Oil and Gas Summit is set to begin today in Algiers and run until Tuesday 9 December. The summit seeks to bring together decision makers from Algeria, Tunisia, Libya, Morocco and Egypt. Speakers at the summit include Mark Fenton, Country & General Manager of Dana Gas Egypt, as well as a senior representative of EGAS.
The State Information Service reports that a U.S. business delegation will visit Cairo tomorrow (8 December) to consider infrastructure projects as well as new and renewable energy investment opportunities. The US embassy in Cairo will hold a press conference tomorrow to mark the visit.
LAST NIGHT’S TALK SHOWS
Last night’s talk shows were all red flags, beeping horns and fireworks as hosts including Lamees El Hadidy, Amr Adeeb, Magdy El Gallad and Moataz El Demerdash celebrated the Ahly Football Club’s 1-0 victory over Ivory Coast’s Sewe Sport in the African Confederation Cup final. Ahly is the first Egyptian team to win the title.
El Hadidy hosted Minister of Electricity Mohamed Shaker.
“7,560 square kilometers of land have thus far been allocated to companies for renewable energy projects,” said Shaker. “We are currently upgrading and strengthening our electricity grid in preparation for next summer, and by June 2015 everything should be complete. We are also in the process of carrying out a plan that will see us through 2025,” the minister said.
“Are you saying that next summer will not be as miserable as last summer,” asked El Hadidy.
“There will be a significant improvement by next summer,” said Shaker. “Last summer we had two major problems: the shortage of natural gas and maintenance issues, which is what led to the extended blackouts,” said Shaker.
The most engaging interview of the night was Naguib Sawiris with Magdy El Gallad. The interview focused on three areas: Sawiris’ assessment of the Egyptian economy at present, what he expects of the private sector in the coming period, and Sawiris’ Egyptian investments.
“70% of our problems are energy-related and 20% are a result of the subsidy system; the rest of our problems are insignificant in comparison,” said Sawiris. “Subsidies were destroying us. The President deserves an Oscar for the bold decision that he took to start dismantling this system. Cash subsidies are definitely the way to go.
“If Egypt is a free market economy then why is the government still undertaking projects like, for example, the new state-owned public transport company that was announced last week? I think it has been proven that the government is incapable of properly running and making money on projects of this nature They should have had private companies participate in a competitive bidding process,” said Sawiris.
According to Sawiris, the Sharm investment summit slated for March 2015 is a “make or break” scenario and “we [the business community] will not let it fail.” Preconditions for a successful summit include:
“We have a golden opportunity: Syria, Iraq, Libya and Algeria are off the map for the time being, so essentially the only country we are competing with in our region is Morocco.
“The job of the private sector is to invest, create jobs and pay taxes. The trick is to align the interests of the state with the interests of the private sector so that it’s a win-win situation — don’t ask the private sector to invest in national projects as part of their patriotic duty to the country.
“Egyptian businessmen are not the 10-15 people who have their pictures in the paper everyday. The majority of businesses in Egypt fall into the small and medium category, and yet what is the government doing for them?”
Asked what he plans to invest in during the coming period Sawiris, preferred to name sectors rather than specific ideas lest someone steal his ideas: “Renewable energy, agriculture and services such as river transport for goods and individuals. Logistics, housing and tourism will also be important. This is a good time to invest in new hotels because tourism is bound to come back. I was just in Gouna and things are looking up.
“I have a sugar factory and I buy beets from Egyptian farmers. We calculated the profit margin that the farmer makes on the beets and we realized that we should give the factory to the farmers and plant the beets ourselves. Seriously, we are considering land reclamation and farming beets as we enter into our next phase of expansion.”
Sawiris’ messages to Mehleb:
Sawiris’ message to the Business Community:
Sawiris’ messages to the President:
Sawiris’ message to Self
Eric Trager is speaking some unpopular truth at The Washington Post in his latest piece: The Egyptian revolution isn’t dead because it never happened in the first place. While there’s nothing Earth-shattering here for many who are well-acquainted with Egypt’s political transition, it’s a welcome reality check (although will probably be greeted with vacant stares) for those who assumed that the majority of the Egyptian population ever really wanted anything else other than thwarting a hereditary succession, and of course, stability. Trager, (along with Samuel Tadros and sometimes Mokhtar Awad), is among the handful of Egypt observers who are willing to consistently describe Egypt’s political landscape with a sense of realism.
The EGX 30 gained 1.65% on Thursday to close at 9,458 on turnover of EGP 901 mn, about 31% better than the 90-day average. KSA’s Tadawul rose 1.8%, the Kuwait Stock Exchange was flat, Qatar climbed 1.1%, DFM shed 0.2% and the ADX rose 0.8%.
The EGX 30 closed up 1.62% for the week, gaining on Wednesday and Thursday after following regional markets down earlier in the week.
U.S. markets all closed up last Friday, with the S&P 500 and the DJIA both closing at new record-highs, riding a 7-week gain.
Stellar US jobs report: The November jobs report was released by the U.S. Bureau of Labor Statistics on Friday (read the press release or view the entire report as a pdf). As Dow Jones’ MarketWatch noted, the report showed that “virtually every industry was hiring and many of the new jobs were so-called good jobs with higher paying wages.” The FT called it “one of the best all-round jobs reports since the start of the recovery in 2009” and suggested “US consumers could once again help to drag the global economy through a soft patch.”
All European markets closed up Friday afternoon, led by the German DAX, followed by France’s CAC 40 and the FTSE; MarketWatch noted that they were all at nearly seven-year highs (Read). The performances came one day after the Governing Council of the ECB kept rates unchanged.
Major Asian markets were up Friday afternoon.
Saudi Aramco discounted on Thursday its exports headed for Asia and the US by USD 1.50 and USD 1.90 per barrel as compared with December, as reported by MarketWatch: “Oil markets have recently been interpreting Saudi Arabia’s monthly price adjustments as signs of the oil producer’s intent to retain market share through a price war.” (Read)
Crude for 15 January delivery fell on Friday, with Brent at USD 69.07 and WTI at 65.84, according to data by Bloomberg. It was the first time Brent closed below USD 70 since 2010, the FT reported.
Low oil prices are driving international oil companies to rethink their global strategies with USD 150 bn in oil projects likely to be axed in 2015, and Geoffrey Smith at Fortune warning “in the new energy world, there won’t be any investment dollars left over for late payers.” Egypt gets a nod from Smith, who writes: “But the shake-out has had some positive disciplining effects too. Egypt, which has been stalling on repaying foreign companies nearly $5 billion in respect of drilling they’ve done, has now given the go-head for its state oil and gas company to borrow $1.5 billion to it can start the repayments. One thing, it seems, is clear: in the new energy world, there won’t be any investment dollars left over for late payers.
Michael Leigh, a Senior Fellow at the German Marshall Fund of the United States, Transatlantic Academy, has a letter in the FT on Greece, Cyprus and Israel’s plan to lobby the European Commission this week to carry out a feasibility study on an undersea pipeline linking Israeli and Cypriot gas to Europe through Greece. Leigh expresses his reservations on building a pipeline linking the Cypriot gas fields with Greece, but endorses the idea of linking Israeli and Cypriot gas via pipeline to Egypt, Jordan and potentially one day the PA. (Read, paywalled)
EGYPT IN THE NEWS
Egypt will have the 12th-highest inflation rate globally in 2015, per a graph of projections tweeted by the Economist Intelligence Unit’s editorial director. Egypt comes in just ahead of Nigeria, but is better-off than lead three Venezuela, Sudan and Argentina.
By now many of you will have heard about U.S. State Department spokesperson Jen Psaki’s “hot mic moment” on 1 December, where she accidentally let loose that her own line regarding Egypt was “ridiculous.” The slip followed her evasive non-response to comment on judicial proceedings involving Mubarak by the persistent AP State Department correspondent Matt Lee. (Watch). While we here at Enterprise are not usually given to flights of conspiracy theory, we’re not sure at all that this slip-up was unintentional. While watching the exchange, note Psaki’s knowing smile to Lee’s questions, culminating in her admission, only seconds after the press conference is supposed to be over: “That Egypt line was ridiculous.” Psaki here comes off as the aunt who “is not that much older than you, you know,” walks in on underage teenagers drinking and insists that she’s “cool” and grabs herself a beer. The intention here being to criticize without officially criticizing.
The very next day, Marie Harf, Deputy Spokesperson for the State Department went much further, again managing to criticize without being overtly critical. (Harf, for the conspiracy-minded, began her career at CIA, where she worked on “Middle East Leadership issue” as an analyst in the DI before becoming a spokesperson for the agency.) Excerpts:
HARF: Well, there are reports today that the prosecutor general has filed an appeal of the verdict. You may have all seen those. We will continue to follow developments in this trial. In that regard, there is an appeal process that will now be taking place. I don’t have anything to add to what Jen said yesterday beyond that.
QUESTION: Well, is it your – I don’t even know if this is worth trying to —
HARF: I share your pain, Matt.
QUESTION: All right. Well – and are you pretty confident, or are you confident at all, in the integrity of Egyptian judicial proceedings, because – particularly considering the fact that they had tried in absentia numerous Americans?
HARF: We have, throughout many, many months, raised very many concerns about the Egyptian judicial processes, including when they sentenced a huge — hundreds of people to death sentences.
HARF: So we’ve been very outspoken about our concerns. Again, we’re going to follow this case. An appeal has been filed, and if we have more to say about the trial as it proceeds, we will.”
The Cairo Press Center and State Information Service struck back yesterday, in a statement they both carried titled “Egypt categorically refuses comments on verdicts of its judiciary,” which reads, in part: “The State Information Service stresses that such comments on judicial verdicts are absolutely rejected and constitute a clear violation of one of the most essential principles of democracy; the separation of authorities.”
Mohamed Fahmy, imprisoned Al Jazeera English bureau chief in Cairo, has relayed statements to the UK’s The Independent that corroborate Mohannad Sabry’s investigative piece for TIMEP which we reported on in our 19 October issue that allege that Al Jazeera, through a combination of negligence, incompetence and apathy, unnecessarily endangered their staff in Cairo and were sluggish in their efforts to assist their reporters. “I said: ‘This is not right – you are going to get us arrested.’ They said: ‘No, leave this to us. Stick to the editorial side.’” (For more from Fahmy, check out his speech to the annual dinner of the Canadian Journalists for Free Expression, published in full on Thursday at the Globe & Mail.)
On Thursday 4 December, the U.S. Embassy in Cairo issued a notice to its staff that reads: “In light of the heightened tensions and recent attacks on Westerners in the region, the U.S. Embassy has recommended that its staff carefully scrutinize their personal movements and consider staying close to their residences and neighborhoods over the coming period. Recently, clashes have been reported at several universities and neighborhoods in the Cairo area. The Embassy has recommended to its staff that the locations of regular protest activity should be avoided.” (Read)
The warning comes after UAE police arrested a woman in the stabbing death of a US teacher. The suspect in the case was also charged with planting a nail bomb at the home of an Egyptian-American physician. (Read)
Egyptians aged 18-40 need prior security clearance from Egyptian authorities for travel to Turkey, the AP reported late yesterday, writing it was “a move intended to stem militant recruitment. Travel to Syria, Iraq and Jordan already requires advance clearance. (Read)
Thomas Friedman writes today that not every Muslim in the world supports Daesh. Some of those criticizing the lunatics are Egyptian. If ever a Friedman column reads as “mailed-in,” it’s this one. (Read)
Islamist scholar Khalil Al-Anani has lost his mind. In ISIS Enters Egypt: How Washington Must Respond for Foreign Affairs, Anani offers a paint-by-the-numbers template of lazy gobbledygook posing as analysis. Exhibit A: “Sisi, meanwhile, is losing touch with the country’s moderate Muslims. The story of Ahmed al-Darawi, a 38-year-old rights activist who died last month fighting under the ISIS flag in Iraq, provides but a single well-reported example of a mainstream Egyptian turning violent.” (Read, or don’t)
(Did you hear that readers? Did you realize that you were just one crazy weekend away from ending up riding around in the back of a jeep in the middle of the desert hoisting a rocket launcher and starting your path to jihad? We’re not at all certain how it is that Western analysts cannot understand that the type individual being drawn to Daesh is, in the main, stupid and naive or unhinged and maladjusted — or some unseemly combination of the two. Trying to pretend that the Egyptian government will inadvertently push moderate Muslims into terrorism is the kind of absurd reasoning that it is simply our fate to hear about and endure, day in, day out, and would never be applied to any other religious group.)
A study was conducted surveying small rug manufacturers in Egypt to show the efficacy of aid-for-trade programs. Their randomized control trial showed that, when given access to an export market, Egyptian rug manufacturers were able to increase their profits by 15-25% with non-monetary benefits arising through a learning-by-exporting process where quality and productivity were improved significantly. (Read)
WHAT YOU CLICKED ON LAST WEEK
The five most-clicked links in the Enterprise Morning Meeting for the week of 30 November were:
ENERGY, RENEWABLE ENERGY & SUBSIDY REFORM
Kuwait signs USD 105 mn loan deal with Egypt to expand generation capacity at west Cairo power station by 650 MW
Kuwait News Agency (KUNA) | 06 Dec 2014
Kuwait Fund for Arab Economic Development (KFAED) and Egypt signed on Saturday an agreement to extend a USD 105 mn loan to finance the expansion of a power station West of Cairo. The expansion of the West Cairo power station aims at honoring growing electricity needs. The funding will be used to build a new steam turbine to produce 650 MW, an official statement said. The KFAED loan, to be repaid over 24 years with additional six years grace period, will cover 13% of the total cost of the project. KFAED and Egypt also signed an MOU to provide USD 3.5 mn in technical assistance to fund a study aimed at exploring means of exploiting human and natural resources in the Safaja-Qaseer-Qena triangle. (Read)
Islamic Development Bank allocates USD 220 mn for Egypt-Saudi power grid connection
IDB release | 02 Dec 2014
The Board of Executive Directors of the Islamic Development Bank (IDB), meeting in Jeddah, approved USD 566 mn for development financing projects in member countries. Among these projects was the allocation USD 220 mn for the Egypt- Saudi Electricity Interconnection Project, which aims to facilitate supply of electricity from Saudi Arabia to Egypt and vice versa, with a maximum capacity of 3,000 MW. (Read)
ABB expands operations in Egypt with new energy facilities in 10th of Ramadan
Zawya | 04 Dec 2014
In a ceremony that was attended by the Ministers of Industry, Investment and Electricity, ABB, a leading power and automation technology group, announced the opening of 2 new manufacturing facilities producing compact substations and medium voltage switchgear to add to its current facilities in 10th of Ramadan City. A building block has also been completely refurbished and is powered by a state of the art solar PV roof top installation(125 KW peak) showcasing ABB’s inverters and electrification solutions used in the solar generation value chain. The solar plant will provide the necessary lighting power in the building with any over-capacity being fed directly into Cairo’s electrical grid. The building will also house a customer showroom where ABB’s range of technologies, products and solutions will be on display. (Read)
Ministry of Electricity admits it used substandard fuel oil at its power plants
Al Borsa | 04 Dec 2014
The Ministry of Electricity admitted it used substandard fuel during last summer’s power crisis to save USD 100 / ton of fuel oil (mazut). A government official disclosed that a ton of standard mazut costs USD 700 / ton, but another grade of low-quality mazut with a higher concentration of sulfur was offered at USD 600 / ton. Due to the financial crunch gripping most government ministries, the Electricity Ministry opted for the cheaper substandard grade. As a result, several electricity plants experienced operational difficulties such as the clogging of heating equipment and other difficulties, which resulted in blackouts and increased maintenance costs. Electricity Ministry ran an EGP 25.7 bn deficit in the fiscal year 2013/14. (Read in Arabic)
El Sewedy Electric still assessing the building of six wind farms
Al Mal | 04 Dec 2014
El Sewedy Electric’s Director of Investor Relations, Tarek Yehia, stated the company has yet to make a final decision on building six wind farms in Al-Zayt Gulf in the Red Sea governorate with a total combined capacity of 600 MW. He noted that the company is still conducting feasibility studies for the new projects. (Read in Arabic)
OIL & GAS
Egypt exploring possibility of refining Kuwaiti oil in Egyptian refineries
Al Mal, Al Borsa | 04 Dec 2014
The Minister of Petroleum said Egypt is currently exploring the possibility of refining Kuwaiti oil at Egypt’s Nasr refinery (following similar news involving Algeria) while floating the idea of creating Egyptian-Kuwaiti refining and petrochemical companies. The news follows meetings between Prime Minister Ibrahim Mehleb, the Minister of Petroleum, energy ministers from Algeria and Kuwait, and the UAE’s Minister of State, with Mehleb stressing the necessity of regional coordination in energy exploration and development activities. Kuwait supplies Egypt each year with 3 million barrels of oil, 1.2 million tons of diesel and 120,000 tons of jet fuel. (Read in Arabic in Al Mal and Al Borsa)
Egypt to import LNG from Algeria
Aswat Masriya and Al Borsa | 04 Dec 2014
The Ministry of Petroleum will begin receiving shipments of LNG from Algeria in 2015. Egypt will import six LNG cargoes from Algeria between April and September, the peak summer season. Al Borsa also reported that the Ministry of Petroleum will create an Egyptian-Algerian oil company to capture industry expertise in the two nations. (Read in Aswat Masriya and in Arabic)
EGPC confirms UAE’s commitment to honor dates of fuel delivery
Al Mal | 04 Dec 2014
EGPC Chairman Tarek El Molla confirmed that the UAE will continue to supply Egypt with its fuel needs in accordance with an agreement between the two sides, denying reports that suggested the UAE may reduce its deliveries. The agreement between the two sides calls for the UAE to supply Egypt with 830,000 tons of fuel every month, including 375,000 tons of diesel, 270,000 tons of mazut, 130,000 tons of gasoline and 60,000 tons of butane gas. El Molla said the deliveries were not gifted to Egypt, but are part of an agreement for which Egypt pays for the fuel. (Read in Arabic)
80 mcf of gas to be added to Egypt’s daily production in December
Daily News Egypt | 03 Dec 2014
An EGAS official said that two wells owned by Petrobel are expected to come online this month. Each of the two is expected to have a daily output of 40 mcf. The EGAS official also told DNE that 520 mcf of gas will be supplied to fertilizer and cement factories, covering 60% of their needs. (Read)
IOCs operating in Egypt expected to sign deals buying gas from Israel
Lebanon Files | 04 Dec 2014
BG and Union Fenosa are expected to soon sign deals to buy gas from Israel. The two companies are also expected to build underwater pipelines, which will connect to an existing gas pipeline in the Sinai Peninsula. The existing pipeline was previously used to transport Egyptian gas to Israel, but is now expected to transport gas in the opposite direction. BG forecasts it will buy 7 bcm of gas annually from Israel over a period of 15 years at a total cost of USD30 bn. Meanwhile, Union Fenosa will purchase 4.5 bcm of gas annually, while a group of Egyptian investors are expected to purchase 2.5 bcm of Israeli gas annually. (Read in Arabic)
BASIC MATERIALS & COMMODITIES
Supply Ministry signs USD 28 mn agreement with Blumberg Grain Silos; Blumberg considers Egypt for MENA technology export hub
Al Borsa and Blumberg release | 04 Dec 2014
Blumberg Grain Silos signed a USD 28 mn agreement with the Ministry of Supply to develop wheat storage facilities at 93 sites in Egypt. Blumberg will automate the sorting and storage equipment at the existing silos to ensure that waste is reduced. According to a release issued by the company, Blumberg Grain announced its intention to build a self-financed factory and export hub to produce food storage technology and systems for the MENA region and has been entertaining offers from possible locations, including Egypt. (Read in Arabic and read the release in English)
Emirati companies to grow wheat in Egypt
Al Borsa and Reuters | 06 Dec 2014
The UAE’s Al Dhara Agricultural Company and Jenaan will engage in a project to grow wheat in Egypt. The two companies will implement their project in Toshka and aim to produce the equivalent of 10% of Egypt’s domestic production of wheat. Jenaan’s CEO noted that the project is impeded by the high cost of transport to their site and the shortage of labor there, along with general concerns about a potential shortage of water. However, he also noted that Egypt had become more stable for investors and that growing wheat was simply the best option the company had for land it had leased in East Oweinat. (Read in Arabic or in Reuters)
Japan Solutions Food opens a factory in Sixth of October
Al Mal | 05 Dec 2014
The Minister of Agriculture attended the opening of first Japanese food production factory in Egypt. With Japan Solutions Food providing 70% of capital, the factory in Sixth of October will process fruits and vegetables for export and will rely exclusively on Egyptian inputs. (Read in Arabic)
Egyptian Saudi Investment and Finance plans to settle with EFSA over freezing its stake in Arab Dairy
Al Mal | 04 Dec 2014
Saudi Egyptian Investment and Finance plans to reach a settlement with the Egyptian Financial Supervisory Authority (EFSA) to reverse a decision to freeze its 30% stake in Arab Dairy. A settlement would enable Egyptian Saudi Investment to sell its stake in the company, which is the subject of a takeover battle between Lactalis, Pioneers and Arrow; Denmark’s Arla pulled out of bidding for the company after completing due diligence. (Read in Arabic)
Suez Cement’s Katameya plant is now running on coal
Amwal Al Ghad | 03 Dec 2014
Suez Cement CEO Omar Mohanna revealed that the factory has completed the transformation of its factory in Katameya that allows it to run on coal. The conversion cost EGP 207 mn and the factory has a production capacity of 1.6 million tons, according to the CEO. (Read in Arabic)
Ataqah Steel adds a new production line by 2015
Al Borsa | 04 Dec 2014
Gamal El Garhy, CEO of Ataqa Steel, said that the company is planning to build a new production line in 2015 with a total investment cost of USD 120 mn. The new line will increase the steel production capacity by an additional 1 mn tons per annum. The company already produces annually 2.5 mn iron pellets and 1,550 tons of steel rods and 2.2 tons of steel sheets, El Garhy said. (Read in Arabic)
BANKING & FINANCE
State-owned bank employees flocking to private sector, Ramez says not worried
Al Arabiya, Amwal Al-Ghad, Al-Masry Al-Youm | 04 + 07 Dec 2014
After the government began enforcing a salary cap for public sector employees, reports estimate that 140 central bank and state owned bank employees have resigned, including the deputy CBE governor, Nidal Assar. Most of the top level employees who resigned their positions moved to the private sector, where no such cap exists. Amwal Al Ghad was told by senior banking sources that capped remuneration is the main reason why private sector positions are now being sought. CBE Governor Hisham Ramez is quoted in Al-Masry Al-Youm this morning as saying the institution will not be meaningfully affected by the maximum wage law; his remarks came during a call-in to a Saturday talk show. (Read in Arabic on Al Arabiya and in Amwal Al-Ghad and check out Ramez’s comments with a link to the video here in AMAY)
EFSA to review M&A regulations?
Al Mal | 04 Dec 2014
An official with the Egyptian Financial Supervisory Authority (EFSA) said procedures for M&A deals in the Capital Markets Laws should be reviewed to allow companies and shareholders to evaluate competing offers. The comments from Sayed Abdel Fadeel come amid intense competition between local and global players to acquire BiscoMisr and Arab Dairy, the newspaper points out. (Read in Arabic)
OTHER BUSINESS NEWS OF NOTE
Italian companies plan to execute seven projects on the Suez Canal and Red Sea Areas
Al Borsa | 04 Dec 2014
A group of Italian companies plan to execute seven projects in the Suez canal and Red Sea area during the second half of 2015, revealed a source within the United Nations Industrial Development Organization (UNIDO) office in Italy. The projects include building two solar cell factories in the Suez Canal area as well as building five five-star hotels in the Red Sea area. The news follows President Abdel Fattah El-Sisi’s visit to Italy to attract investments last month. (Read in Arabic)
Greek-Egyptian business forum kicked off on Thursday with high-profile Greek delegation present
Zawya and SIS | 04-06 Dec 2014
A high profile Greek delegation was in Cairo to discuss investment opportunities and attend the Greek-Egyptian business forum last week. With trade between Greece and Egypt reaching EUR 1.7 bn in 2013, the forum explored ways to boost cooperation between Egyptian entrepreneurs and Greek businesses. According to a release following the forum, a cooperation protocol was signed between Egypt and Greece aiming to increase investments and cooperation in the fields of communications, logistics and manufacturing. (Read in Zawya and a brief wrap-up by SIS)
Agreement to combat Industrial waste signed with the EU
Al Mal | 04 Dec 2014
Minister of International Cooperation Naglaa Al-Ahwani has signed the third stage of an agreement to combat industrial pollution with the ambassadors of the EU and France and the head of the Near East division of the European Investment Bank. The agreement will secure funding of EUR 150 million for the Egyptian government’s environmental apparatus. These funds will be used to invest in projects that lower industrial pollution, invest in green energy and strengthen the functions of environmental regulatory bodies. (Read in Arabic)
Industry federation’s textiles division to settle with minister, federation head over spin-off
Al Borsa | 04 Dec 2014
The textiles division of the Egyptian Federation of Industries has agreed to the Administrative Court’s proposed settlement in its lawsuit against Minister of Trade and Industry Mounir Fakhry Abdelnour and EFI head Mohamed El-Sewedy. The lawsuit claimed Abdelnour and El-Sewedy had failed to enforce a previous court decision to announce the results of a referendum deciding whether the ready-made garments division could splinter off. (Read in Arabic)
EGYPT POLITICS + ECONOMICS
President El Sisi urges adherence to environmental standards regarding usage of coal
Al Mal | 04 Dec 2014
In a meeting with the Minister of Environmental Affairs, President Adel Fattah El-Sisi reviewed recent developments in the usage of coal in domestic industries. While coal could be used to diversify Egypt’s energy sources, El Sisi said, its ramifications on human health and the environment should be monitored and assessed. (Read in Arabic)
Investors’ problems in Egypt remain unaddressed – SEBA
Al Mal | 04 Dec 2014
The Secretary General of the Saudi Egyptian Businessmen Association (SEBA) said that Saudi investors continue to face problems in Egypt despite the government’s promises to resolve issues. He cited the problem of dairy producer Al Marai, which promised to pump EGP 4 bn in investments into Egypt six months ago, but still awaits government approval for land registration and licensing. (Read in Arabic)
Canary Wharf rebuffs new USD 4 bn bid from Qatari wealth fund
Reuters | 05 Dec 2014
On Friday, Songbird Estates, owner of London’s Canary Wharf, rebuffed a raised USD 4.1 bn bid for the financial district from Qatar and North American investor Brookfield Property Partners LP, saying the offer “does not reflect the full value of the company, its unique position and future growth potential”. In a hostile move, QIA and Brookfield had taken their new joint all-cash bid directly to shareholders on Thursday. Songbird owns 69.4% of Canary Wharf Group, and Brookfield already owns 22.1 percent of Canary Wharf. QIA owns 28.6% of Songbird. (Read)
Bidding set to begin for EUR 6 bn Swedish power grid – sources
Reuters | 04 Dec 2014
Reuters reports that Finland’s state-controlled utility Fortum is selling its Swedish power grid, which is seen as being able to command a selling price of EUR 6 bn. Bidders for the utility include Canadian pension fund investment entity Borealis, Macquarie Funds Group and Cheung Kong Infrastructure Holdings (CKI), the largest publicly listed infrastructure company in Hong Kong. (Read)
Putin state of the union address: SWF should recapitalize domestic banks
Reuters | 04 Dec 2014
In his annual state of the union speech on Thursday, Russian President Vladimir Putin announced that the country sovereign wealth fund, the National Wealth Fund (NWF) should step in to help fund domestic banks to assist them in meeting loan demand given their operating constraints under Western sanctions. According to Reuters, “Russian Economy Minister Alexei Ulyukayev said he considered support of 250 billion rubles for VTB as “minimal” if the state wanted it to fund infrastructure projects and grow faster.” (Read)
Judd Apatow-Seth Rogen movie may have triggered North Korean hackers’ cyber attack on Sony
Reuters and Quartz | 05-06 Dec 2014
Sony Pictures Entertainment company was the victim of a cyber attack starting on 24 November in what has been described as the most destructive to date against a firm on US soil. According to Reuters, the attack “knocked much of Sony’s network off line with malware that wipes drives of PCs, making them unable to operate. It is expensive to repair them because each drive needs to be manually replaced or re-imaged. People close to the investigation have told Reuters that North Korea is a principal suspect, yet a North Korean diplomat has denied that his nation is involved.” On Friday, the story took a more worrying turn when Sony employees reported receiving death threats purporting to be from the same group who committed the attack. Quartz notes that while the attack was probably prompted by the upcoming Apatow-Rogen film The Interview, “a comedy about an attempt to assassinate Kim Jong-un” the attack seems to not have fazed investors, as Sony’s stock moves toward a 1-year high. (Read in Reuters here and here and in Quartz)
Business Insider reports that the US Defense Department has caught Egyptian-American naval engineer Mostafa Ahmed Awwad in a sting operation in which he is alleged to have tried to sell schematics for a U.S. nuclear-powered aircraft carrier to an individual he thought was working for Egyptian intelligence. According to Business Insider, Awwad “even explained the best places to strike the carrier in order to sink it. Awwad allegedly brought a handgun to one of his meetings with his contact as well.” What an idiot. What did he believe that Egypt would do with this information? Go to war with the United States? Really? (Read)
Gender equality triggers suicides, Turkish PM suggests: There’s really nothing more for us to add; no point beating a dead horse. (Read)
Ahram Online and The National are reporting that Interpol has issued a red notice for the arrest of some hillbilly named Yusuf Qaradawi on the grounds he faces charges in Egypt of “agreement, incitement and assistance to commit intentional murder, helping prisoners to escape, arson, vandalism and theft.” Asharq Al-Awsat joins the party with the lede that “Interpol issued arrest warrants for more than 40 senior Muslim Brotherhood-affiliated figures” including Qaradawi, quoting a “high-level Egyptian security official” as saying on Saturday that “Egyptian authorities succeeded in persuading Interpol that these figures are fugitives and terrorists who are inciting violence and crimes.” (Check out the Qaradawi red notice here)
The reality, however, may be a bit more complicated, as GlobalMBwatch reminds us: “It is highly likely that the INTERPOL action was disseminated by Egypt by means of the agency’s ‘I-Link’ system, an instantaneous means for distributing alerts … Red Notices issued in this manner are only temporary and are subject to review, part of which will undoubtedly consist of a determination as to whether or not the charges against Qaradawi are politically based. Whether or not the notice is rescinded, it would appear to be somewhat of a headache for Qaradawi, restricting his ability to travel while the notice is in effect.
An executive who used to run a joint venture between Bechtel and Egypt’s electricity company pleaded guilty to accepting USD 5 mn in kickbacks to manipulate the bidding process for state contracts, according to Reuters.
An Egyptian has been added to the FBI’s most wanted list: The New York Times reports that Yaser Abdel Said has been added to the list as he is wanted for the murder of his daughters. While we’d never make light of murder, the New York Times gently pokes fun at the FBI’s description, calling it a “particularly detailed announcement,” which is being modest. The description reads: “Said’s physical features may vary in order to conceal his identity” [i.e. we may be dealing with a shape-shifting mutant, not entirely dissimilar to Mystique]. “He always wears dark sunglasses, both indoors and outside … He frequents Denny’s and IHOP restaurants and smokes Marlboro Lights 100s cigarettes. Said has ties to New York, Texas, Virginia, Canada, and Egypt.” This last part of his description narrows the field down to every Egyptian, ever. (Read in the NYT and his description on the FBI’s most wanted list)
Sam Richardson was a standout in Veep season 3 as one of the more overly helpful underlings portrayed on television in recent history. This past September, the showrunners announced that Richardson will be joining the show as a series regular. Have a look at his debut episode in this deleted scene from Season 3. Running time: 2:00 (Watch)
On the other end of management pyramid, Glenn Close delivers excellent put-downs (which we all enjoy) in her portrayal of Patty Hewes on Damages, great for the next time you’re fuming for days trying to come up with comeback. Running time 2:30 (Watch)
YOUR DAILY LARRY DAVID: Larry David honors Steve Martin at the Mark Twain Awards circa 2005. Running time 7:24 (Watch)
ON YOUR WAY OUT
Japan not yet committing to Sharm summit: Japan is awaiting “clarification on the vision for this conference, the Daily News reports, quoting Japanese Ambassador to Cairo Takahiro Kagawa as saying: “The investment climate in Egypt is not bad, but Japanese private sector companies operating here face many problems, most notably accessing foreign currency on the local level.”
GAFI announced that 2,823 companies were set up from July until October 2014 with investments equivalent to EGP 4.7 bn. (Read in Arabic)
Uber taps Qatar Investment Authority in USD 1.2 bn fundraising round. Says the WSJ: “Qatar is one of several foreign investors with whom Uber has discussed a strategic investment as the startup seeks to build ties with powerful allies who can help ease its expansion into new geographic regions.” (Read)
It’s all Turkey’s fault: Prices of Nutella, Ferrero Rocher and other hazelnut-based chocolates could rise this holiday season as Turkish farmers (responsible for c. 70% of the world’s supply) horde hazelnuts after an early frost slashed production by 28% this year. (Read)
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