Monday, 2 February 2015

Consumer confidence rising. IDH looks at dual EGX-LSE listing. AJE journo released. Israeli delegation in town for gas talks. Nouran to begin sugar production by 4Q16. KSA will still open to foreign investors. GTH sells Djezzy stake.

LAST NIGHT’S TALK SHOWS

Lamees El Hadidy stumbled upon what may be the making of a national strategy to combat population growth. President El Sisi alluded to the strategy during his speech on Sunday, and Minister of Social Solidarity Ghada Waly called into the program to confirm the existence of such a strategy for 2015. Apparently, the government will no longer provide cash subsidies to any family that has more than three children. “A fourth or fifth child is not eligible for any assistance,” said Waly.

Commenting on the release of Australian journalist Peter Greste, one of the imprisoned Al-Jazeera English Three, El Hadidy said, “good riddance” but “what about Mohamed Fahmy? Why isn’t he being deported to Canada? It doesn’t really make sense that he should be kept in jail just because he is a dual Egyptian-Canadian national. We are paying a very high political price for with these types of cases. The imprisonment of journalists is harming the country’s reputation and the reputation of journalism in Egypt. I call on our judiciary to look into such matters, and if laws must be amended to avoid these types of scenarios, then so be it. These people aren’t worth the damage that they are causing the country. Just deport them and be done with it. The President asked for this to happen early December. Why did it take two months to implement? We could have saved ourselves two months of condemnation from the international community.”

[While Lamees is at it, let’s note that pretty much every commentator we’ve read has despaired over the fate of Baher Mohamed, the producer imprisoned with Fahmy and Greste who appears at present unlikely to be released because he holds only Egyptian citizenship.]

El Hadidy continued to call for the removal from the internet of Jihadi websites and any website or news outlet that acts as a mouthpiece for Ikhwan. She called upon Hossam Saleh, an internet and information technology expert, who tried to explain what every 10-year-old knows: that the complete removal of any website by a third party is virtually impossible because they will appear in some form or another the next day. “We may be able to block some sites in Egypt, but we cannot make them cease to exist,” said Saleh.

Mahmoud Abaza, former head of Al-Wafd Party, was El Hadidy’s guest. Abaza provided analysis of the current political situation in Egypt and the region. He admitted that our political parties our weak and inexperienced, but in a fit of raging optimism said this will not remain the case. According to Abaza, it is inevitable that these parties will eventually mature and become effective. As for the upcoming parliamentary elections, Abaza feels that the reticence of the government (read: the President) to become involved is a mistake.

“The government needs to have a majority in Parliament in order to be effective and there is no shame in that because otherwise we will be at a deadlock. The only thing we need to ensure is that the elections are fair and there is not vote rigging,” said Abaza.

Amr Adeeb was happy with President Abdelfattah El Sisi’s meeting today with national leaders in the wake of the weekend terror attacks in North Sinai. Among those the president gathered together were the Ministers of Interior and Defense, political party leaders, Sheikh Al Azhar and the Coptic Pope. “The inclusiveness of the gathering sends a very strong message indicative of the President’s desire to be viewed as an accessible leader who is not out of touch with society,” said Adeeb.

[On a related note: Ahram Online had news following the meeting that the president and political leaders alike were resolute that both the upcoming parliamentary poll and Sharm economic conference would happen on schedule in March despite the weekend attacks. Al-Ahram has a lengthy take on the president’s remarks here.]

SPEED ROUND

Following rumors sparked by tweets from former parliamentarian and media figure Moustafa Bakry, and as noted above in our talk show review, yesterday witnessed the release of Al Jazeera English journalist Peter Greste, who arrived in Cyprus to rest before returning home to Australia, as reported byReuters.

Canadian Foreign Minister John Baird welcomed the news of Greste’s release, and expressed his hope that it will be followed by the release of dual national Mohamed Fahmy, with Baird noting that he is in contact with Foreign Minister Sameh Shoukry. In the Reuters piece, Fahmy’s fiancée is quoted as saying “His deportation is in its final stages. We are hopeful.” In another brief Reuters piece, an unnamed security official is quoted saying that Fahmy is set to be released within days. Al Jazeera, in its coverage, carries the statement: “Al Jazeera Media Network welcomed the move but demanded the release of Greste’s colleagues.” Fahmy’s mother has posted an open letter to President Abdelfattah El Sisi pleading for his release. Fahmy’s Twitter feed, which is managed by his family, was polling followers yesterday if they thought it was acceptable for Fahmy to renounce his citizenship in exchange for his release, in what appears to be an option being considered. At the moment, there is no word on progress or a specific mechanism that would permit the release of Egyptian national Baher Mohamed.

Consumer confidence in Egypt surged a remarkable 14 points y-o-y, and 5 points q-o-q in 4Q2014, according to a Dow Jones MarketWatch pickup of a press release by global information firm Nielsen. In a release by Nielsen on its quarterly Middle East / Africa report, Managing Director of Nielsen Egypt Tamer El Araby is quoted as saying, “Egypt’s consumer confidence score has been climbing for the last two quarters, and we see a direct correlation to the country’s economic growth during that same period … As Egypt approaches the confidence baseline score of 100, the next challenge will be to improve how people perceive their personal finances. This could lead to a point when Egyptian consumers no longer focus on immediate living requirements, but rather look forward to potential future growth.” (Note from Enterprise: Attempting to download the report from the release page after being prompted for extensive personal details, however, gives a link to a different report about global eating habits. The Nielsen people might want to have a look at that.)

We’ll find out tomorrow after 5:30am London time whether purchasing managers surveyed for the HSBC / Markit PMI share the optimism of Egyptian consumers.

Tourism revenues rose 27% in 2014 to USD 7.5 bn, up from USD 5.9 bn in 2013, according to Minister of Tourism Hisham Zaazou yesterday, Reuters reported. Egypt received 9.9 mn tourists in 2014, up from 9.5 mn the previous year, the minister said.

Abraaj’s Integrated Diagnostics Holdings said yesterday it will delay its London IPO to seek a dual listing on the London and Cairo stock exchanges, according to a report in the Telegraph. The story claims the company cited “strong interest from international and particularly local Egyptian investors” for the decision to seek an EGX listing in parallel with the LSE. There was no word whether IDH would still bring on Lord Anthony St. John as non-executive chairman in such a scenario. Lord Anthony, a hereditary peer of the House of Lords, is the chairman of advisory firm Strand Hanson, as previous Telegraph coverage has noted, and was reportedly brought on to address LSE concerns about governance at MENA-based firms.

Sugar producer Al Nouran gets some love from Reuters this morning as Chairman and CEO Ashraf Mahmoud announces a 4Q2016 start of operations for the EGP 2.5 bn megaproject. “In the last quarter 2016 we start refining, first quarter of 2017 we start producing,” Mahmoud is quoted as having told an industry gathering yesterday. The 300 kt production and refining facility fits with the national move toward sugar beet rather than sugar cane, with the former requiring far less water to grow. Al Nouran will also produce ethanol and could export as much as 100 kt sugar annually after covering domestic demand, reducing Egypt’s reliance on sugar imports by as much as 25%. Egypt consumes 3.2 mn tonnes of sugar each year, the story notes.

Security analysts provide commentary on President El Sisi’s speech following the North Sinai attack on Friday: Speaking to Daily News Egypt, General Alaa Bazeid, Director of Egypt’s Strategic and Security Studies Centre, says El Sisi, when speaking about a meeting that took place on 21 June 2013 in which Egypt’s security was threatened with jihadis coming in from “all corners of the globe,” says that the threat originated from Muslim Brotherhood Deputy Guide Khairat Al Shater. Security analyst Abd Al-Moneim Saeed is also quoted in the piece stating that the attackers likely had outside help in the execution of their attack. (Read)

Two women were killed by Islamist militants in Sinai yesterday and a third died in crossfirebetween militants and the military, security sources said. Two women were killed by a wayward RPG which struck their home and was launched by Islamist militants in the town of Rafah bordering Gaza, as reported byReuters. Two other women and two children were injured in the RPG attack. A third woman was also killed in her home as militants and the armed forces exchanged fire.

President Abdelfattah El-Sisi told the nation’s armed forces and police to be “‘mindful of human rights’ while doing their jobs, in apparent response to growing criticism of what critics perceive as the security forces’ heavy-handed tactics,” Ahram Online reports. The president’s remarks came yesterday at a meeting of national leaders called after the weekend terror attacks. The same meeting saw Minister of Interior Mohamed Ibrahim “promise the people that if a police officer or conscript is proven implicated [in socialist activist Shaimaa El-Sabagh’s killing], I will hand him to the criminal and administrative courts,” referring to the slaying of the activist at a peaceful march on 24 January.

Saudi Prince Alwaleed bin Talal launched the pan-Arab media outlet Alarab News Channel yesterday. The first broadcast aired from their studio in Bahrain, although their office in Riyadh is expected to be their largest bureau, according to the AFP. The channel will be headed by Jamal Khashoggi, who will serve as Alarab’s general manager. The AFP piece notes that Khashoggi was forced to step down from Saudi daily Al-Watan in 2010 after the paper published  an opinion column that offended religious conservatives. Khashoggi says that the channel’s coverage will strive to be neutral and estimates its global staff will number at around 280 with correspondents in 30 countries. The new channel’s website is Alarabtv.net and its Twitter handle may be found at @AlArabNewsTV. While not mentioned in the AFP piece, a tweet by Alaa Shahine, Bloomberg News Team Leader for Mideast, states that the channel will run Bloomberg-branded stories.

Chief Financial Officer Mohammed Fahmy of Prince AlWaleed bin Talal’s Kingdom Holding Co.announced that the investment company is planning to a number of IPOs from 2016-2018, according to an interview given in Riyadh to Bloomberg Business. “Flynas LLC, the Saudi budget airline in which it holds a 34 percent stake, is among companies planning share sales, he said, declining to identify others.” (Read)

Saudi Arabia remains on track to open stock market to qualified foreign investors, the new head of the Capital Market Authority said yesterday, according to a Reuters report played prominently by the Saudi Gazette. “The CMA is committed to open the market to foreign investors in the first half of this year. This decision is very important and has huge benefits, and we have institutional commitment to it,” Reuters quoted Muhammad Al-Jadaan as telling Al-Hayat. Al-Jadaan was founding partner at the Riyadh law firm of Al-Jadaan & Partners and was made head of the CMA in a wide cabinet shuffle ordered this past Thursday night by King Salman. Al-Jaadan also suggested he looks forward to new listings in the kingdom; he replaces Mohamed El-Sheikh, who quickly beat a path to the press after Abdullah’s death to reassure investors the market would still open to foreigners as planned.

Jordan in talks to buy gas from Gaza: In news that raises some questions, The Jordan Times quotes Minister of Energy and Mineral Resources Mohammad Hamed as saying that Jordan is in negotiations to import 130 to 150 mn cubic feet of natural gas per day from BG Group sourced from the Gaza Marine offshore gasfield. BG Group has a 90% interest in the field, with the agreement being signed with the Palestinian Authority, which was signed before Hamas seized Gaza by force in 2007. (Read)

Libya’s Tripoli now has its own Islamic State affiliate, calling itself “Tripoli Province,” the Wall Street Journal‘s Matt Bradley and Benoit Faucon report. The group claimed responsibility yesterday for the bombing last week of the Corinthia Hotel, an incident that killed nine. There were reports of a Daesh affiliate in the eastern town of Derna, 450 miles from Tripoli, as far back as last November.

Al-Mal is championing Croatia’s move to forgive the debt of thousands of its poorest citizens, putting its spin on a wire story on the topic, and prompting us to wonder how widely in the Egyptian press this news might travel, though it would be difficult to replicate here: Key is that the poorest of the poor in Croatiahad access to credit and were “banked” in the first instance.

UK’s Prince Charles to visit the Gulf region: The UK’s Prince Charles will begin a tour of the Gulf region at the end of this week from 6-12 February, and will reportedly visit Kuwait, the UAE, Jordan and Qatar. (Read)

The Obama administration will propose a one-time 14% tax on U.S. profits banked overseas and a 19% tax on the future global earnings of U.S. companies in its 2016 budget plan due to be released today. The measure would net the treasury some USD 238 bn to fund infrastructure projects in America. Get more from the WSJ, BBC or Associated Press.

The ‘Oracle of Omaha’ to speak: Warren Buffett and his business partner Charlie Munger, who have a combined age of 175, we are reminded, are planning to write separate letters to shareholders looking back on the past 50 years of Berkshire Hathaway and setting a vision for the 50 years to come, the FT reports in a lengthy look back at the “philosophical foundation of a confounding company.”

Talks between IMF and donor countries are ongoing as it appears there may soon be an agreement to forgive some of the debt of Ebola-hit West African nations.

“Apple is so big that…”: BuzzFeed’s Tom Gara started the quarterly gabfest with his weekend piecefollowing the tech company’s best-ever quarterly results, noting that “Apple now has enough cash to buy Twitter, LinkedIn, Yahoo and HP. … After the results were announced, Apple rose in value by one entire Yahoo. … Apple lost more revenue to currency fluctuations than Microsoft made from its entire phone hardware business.” The Wall Street Journal’s Money Beat blog is also getting in on the act, noting that if Apple can keep the pace through year’s end, its revenues will be “more than the individual economies of Hong Kong, the Philippines or Egypt, among others.”

CORRECTION: In yesterday’s issue of Enterprise, an omitted word misrepresented President El Sisi’s statement regarding terrorism. The passage should have read: “President El Sisi also reaffirmed his commitment to the upcoming Egypt Economic Development Conference in Sharm, saying that terrorism will not deter the country from economic recovery.” H/t Osama Ezzeldin for bringing this to our attention.

IN FOCUS: PROGRESS ON ISRAELI GAS

After Israel’s Antitrust Authority’s commissioner David Gilo threw Israel and the larger region for a loop in December 2014 by announcing he planned action against the partners in the Leviathan gasfield Delek Group and Noble Energy, threatening charges that they constituted a cartel, it seems some headway is finally being made to amicably resolve the issue. While Gilo’s move was applauded by populist members of the Israeli Knesset, a near-unanimous consensus viewed the move as suicidal for Israel’s gas industry, as the reserves are not sufficient for a highly competitive industry to emerge.

Hearings were held behind closed doors last weekend between the antitrust body and the Leviathan partners, with the case being stronger for the developers, according to The Jerusalem Post. “Industry sources told the Post on Wednesday that from a legal standpoint, the Delek-Noble partnership in Tamar and Leviathan in no way constitutes a restrictive agreement … Should the Antitrust Authority proceed with the move to declare the partnership a restraint of trade, the sources expressed confidence it would lose a legal battle in court. It is unlikely the commissioner will bring the issue to court, however, as work on a compromise among the parties is continuing, the sources added.” (Read in The Jerusalem Post)

However, the proposed deal to export gas from Israel to Egypt seems to be sidestepping the regulatory uncertainty regarding the Leviathan field altogether, as a Reuters piece, which was picked up in the Egyptian Arabic press, notes that the gas may be sourced from the Tamar field, which is also run by Noble Energy and Delek. While Tamar has had its share of regulatory uncertainty in the past since its discovery in 2009, the field is already developed, with plans to double such production for export to Egypt, as reported in November by Israeli news site Haaretz.

Israeli delegation visits Egypt yesterday to discuss supplying natural gas: A delegation from Noble Energy arrived in Egypt yesterday from Israel, according to Reuters citing a source at the Cairo airport. A piece in Al-Shorouk cites an unnamed source at EGAS speaking to Reuters that the Israeli delegation will discuss the possibility of supplying Egypt with natural gas from the Tamar field through the East Mediterranean Gas company pipeline that was supposed to transport gas from Egypt to Israel. Additionally, some partners in the Israeli offshore gas field Tamar explained that they negotiated during last October, selling at least five billion cubic meters of gas over a three years period to private sector companies in Egypt through the ten years old pipeline built originally to transport gas to Israel. (Read the original piece in Reuters and or in Arabic in Al Shorouk)

In related news, the Minister of Petroleum, in a statement to Al Borsa carried by sister publication Daily News, said that he was informed prior to negotiations by Dolfinos Holdings Ltd. of their interest in importing gas from the Tamar field to the EDCO plant.

WORTH READING

King Salman of Saudi Arabia instituted a sweeping cabinet reshuffle last Thursday night, but left untouched the ministries of oil, finance and foreign affairs. Beyond the Cabinet, the king also abolished a number of councils, created new ones in their place, empowered his son and relieved others of their duties. Salman also appointed Mohammed Al Jadaan as new chief of the Capital Market Authority. In addition to the political changes made, the king also ordered a significant increase in public spending, including two months of bonus salary to all public sector employees and pensions to those already retired, as well as a USD 5.3 bn spending program for electricity and water to new housing developments. For a comprehensive and straightforward outline of the political and economic changes made without much in the way of editorialization or commentary, a good place to start is Ahmed Al Omran and Summer Said of The Wall Street Journal’s piece ‘Saudi King Shuffles Cabinet, But Leaves Oil Minister.’ (Read, paywall)

For analysis and a closer look at what the political implications of these decisions, Andrew Critchlow, former deputy bureau chief at Bloomberg and former managing editor of Dow Jones Middle East, writes for The Telegraph: ‘Saudi Arabian oil minister weakened by elevation of king’s son.’ From the report: “Although the new king has left Al-Naimi in his post he has significantly diluted his power over the nation’s oil policy by promoting his son Prince Abdulaziz bin Salman al-Saud to the position of deputy oil minister, from his previous role as assistant minister. According to insiders in the kingdom this subtle change could have profound implications for Al-Naimi’s future and perhaps signal that he is gradually being ushered out of the seat he has occupied since 1995.”

Aside from the recent political re-ordering and public spending, David Andrew Weinberg at FP charts King Salman’s history and alleged ties to financing fundamentalists around the world for the past few decades. (Read)

WORTH WATCHING

Love him or blame him for a number of the problems we still face today, the impact Gamal Abdel Nasserhad on our country and region is undeniable and warrants attention and study even to this day. Watch him here address an audience about a conversation he had with the Muslim Brotherhood Supreme Guide in 1966.It’s fascinating to see how Egyptian society has evolved since the speech. (Watch in Arabic with English subtitles, running time: 2:20) H/t Cade Benedict.

DIPLOMACY

The Ministry of Foreign Affairs’ condemned last weekend Israel’s announced intention to build 450 new housing units in the West Bank in a statement, saying “this settlement destroys Egypt’s endeavors to resume peace talks between Palestine and Israel.” A spokesperson for Israel’s Housing Ministry is portraying the units as not being new but as remarketed units after the initial announcement a year prior had failed to attract contractors. (Read)

Meanwhile, sources close to Hamas have said that the group no longer accepts Egypt as a mediator with Israel, according to sources speaking to Reuters last Saturday, in response to an Egyptian court’s decision the same day to designate Hamas’ military wing the Al Qassam Brigades as a terrorist organization. Interestingly enough, an editorial has appeared in Qatari-owned media outlet The Peninsula yesterday which is nominally titled ‘Mending ties’ followed by a garishly-sized dek that reads: “Hamas and the Sisi government need to sit together and sort out their differences.” Owned by Qatari royal Khalid bin Thani Al Thani, The Peninsula’s editorial is remarkable, if not for its inflammatory language (which we’ve come to expect from Qatar, which seemed only too eager to resume hostile relations with Egypt almost instantly as King Abdullah was laid to rest) but for its reference to the supposed “source” regarding the above-mentioned story on Hamas. From the editorial: “The relations between the two sides are sinking to new lows, and that’s a complete turnaround compared to the cozy relations between Hamas and the former Brotherhood government of Mohammed Mursi … The court ruling is in keeping with the systematic crackdown on Islamists by Sisi.” Etc

Maybe Hamas could turn to its old friends, Iran and Hezbollah. The Tehran Times reported on Saturday thatHamas asks for more Iran’s[sic] support. Now, Iranian media is otherwordly in its blatant untruths (refer to the piece on Egypt below), but Israeli news site i24 News also alleges that “A senior Israeli official told the Walla web site on Sunday that Iran had been transferring funding to the Hamas after cutting off support to the organization some three years ago to protest its backing of rebels opposed to Syrian President Bashar Assad. ‘We’re not talking about the same amount of funding as Qatar, but it’s a significant move,’ the official said.” (Read on i24News)

MOFA seeks to end transmission of Ikhwan-affiliated satellite television channels: Meanwhile, Egypt’s Foreign Ministry is “conducting extensive talks with France where it says the Brotherhood-linked television channels are being aired from, and is seeking “firm action” against them,” according to Ahram Online, referencing statements from the MOFA. “Some members of these entities are wanted for trial and are visiting many states to promote wrongful and extremist ideas ….. as well as making efforts to shore up support for malicious goals to destroy the Egyptian state,” according to the statement. (Read in Ahram Online)

Ikhwan leaders to reportedly return to Qatar, according to the Facebook page of Brothers Without Violence, as reported by The Cairo Post. “The secretary general of the Brotherhood Mahmoud Hussein, Freedom and Justice Party spokesperson  Hamza Zawba, along with Essam Talima, the  office director of sheikh Yousef al-Qaradawi, are among those expected to return to Qatar, according to the statement.” (Read in The Cairo Post)

EGYPT IN THE NEWS

The release of Peter Greste, an Australian national and one of the three Al-Jazeera English journalists to have spent some 400+ days in jail for allegedly supporting the Brotherhood, dominated international headlines about Egypt overnight. Get your fill from the FT, the BBC, Reuters or the New York Times. All of them hit the same notes: Relief the release of Greste; hope that Fahmy will follow; and despair that the same path of ‘release and deportation’ is inapplicable in the case of Baher Mohamed, the Egyptian producer.

Gulf supports Egypt in its “hour of need”: UAE-based Gulf News published an editorial yesterday affirming the support of the UAE and Saudi Arabia for Egypt, including its struggle against the Muslim Brotherhood. The Gulf countries share Egypt’s view that “the Muslim Brotherhood is an existential threat …   It is significant that the Gulf states have not wavered in their support for Al Sissi’s government, despite wayward international speculation and the falling oil price.” (Read)

The funniest news you will read all day: Iranian state media is reporting that President Abdelfattah El Sisi met with Iran’s Deputy Foreign Minister for Arab and African Affairs Hossein Amir-Abdollahian on the sidelines of the AU Summit in Addis Ababa. The news appeared in The Tehran Times, and PressTV. It could be just a grievous typo (we wish we could excuse the entire article as just one big typo), but both articles state that the alleged meeting was held on Sunday. Which is really funny. President Abdelfattah El Sisi left for Ethiopia on Thursday, returned to Egypt on Friday and met yesterday in Cairo with Egyptian political, military, police and civil society leaders. That the alleged meeting took place on Sunday was emphasized by The Tehran Times as they state it was also the day that a meeting was held between Iranian and South African diplomats. Lastly, the Photoshopped image could use some work. A white background? That’s just lazy. Get it together, Iranian state propaganda.

Dina Khayat, identified as the founder and chairman of an unnamed asset management firm in Egypt, (likely MadarCapital, but this is not mentioned in the article) writes for The Hill: ‘In Egypt, we are all the Egyptian army.’ The piece criticizes the Americans for meeting with members of the Brotherhood against the backdrop of riots and terror attacks in Egypt, stressing that this sends an incredibly negative message to Egyptians who view the security services as their sons, given that “Egyptians see in the army their sons protecting the borders and fighting terror.” The attempt at providing an Egyptian perspective is laudable but, Khayat unfortunately steps into some logical and rhetorical inconsistencies when citing shared universal values between the Egyptian and American governments, considering that the Egyptian government’s position on certain criticisms, whether each individual subscribes to the position or not, is that issues such as the death penalty reflect cultural norms and will not be abolished. (Read)

The UAE’s The National carries a nice profile of the SME scene in Egypt as told through the eyes of errands service Ingez and Shariah-compliant crowdfunding platform Shekra.

ENERGY, RENEWABLE ENERGY & SUBSIDY REFORM

20 MW solar power station in Hurghada to be tendered
Al Mal | 01 Feb 2015
The construction of a 20 MW solar power station in Hurghada will be tendered this month. The Ministry of Electricity is aiming to attract international firms to the project that is expected to cost around USD 50 mn. The Japanese International Cooperation Agency has conducted the feasibility studies for the project and will be providing the funding for the power station that is expected to come online in 2016. (Read in Arabic)

Co-Op Petroleum to begin implementing second phase of smart card system
Al Mal | 01 Feb 2015
Co-Op Petroleum will begin implementing the second phase of the smart card system for fuel in Suez, Ismailia, Port Said, and Damietta. The smart cards will be used in Co-Op’s 100 gasoline stations in the four cities. The ministries of Finance, Petroleum, and Planning are aiming to have trialled the second phase of the system before the end of June. (Read in Arabic)

Ministry of Electricity to hold meeting mid next month with 136 renewable energy companies
Al Borsa | 01 Feb 2015
The Ministry of Electricity will hold a meeting next month with the companies that were pre-qualified for renewable energy projects in Egypt. The topics to be addressed include licensing and registration, land allocation, financing, and power allotment. Some 136 domestic and foreign companies have been pre-qualified in categories including: under 20 MW and 20-50 MW for solar and over 20 MW for wind projects. (Read in Arabic)

OIL & GAS

IDB unit extends Islamic reinsurance for Apache’s Egypt projects
Reuters | 1 Feb 2015
The Islamic Development Bank has “has provided USD 80 mn worth of sharia-compliant reinsurance to cover political risk for oil and gas projects” at Apache concessions in Egypt. (Read)

10 banks to extend a EGP 15 bn loan to EGPC
Al Mal | 01 Feb 2015
A consortium of 10 domestic banks including NBE, CIB, Banque Misr, and QNB have proposed to extend a EGP 15 bn loan to EGPC. The proposed loan could be repayable over 5-7 years in agreement with EGPC and the Electricity Holding Company (EHC). The loan will be used to repay IOCs but will also help resolve financial issues between EHC and EGPC. EHC will be responsible for repaying the loan, thereby cancelling it out receivables owed to EGPC. (Read in Arabic)

APRC to invest EGP 1.7 bn in a new refinery
Al Mal | 01 Feb 2015
The Amreya Petroleum Refining Company (APRC) is planning on investing EGP 1.7 bn to build a new oil refinery. APRC is currently assessing funding options as well as considering the options for designing and implementing the project. The proposed refinery will have a capacity of 4-5 million tons of crude as the company aims to increase its production of butane, gasoline, and fuel oil. (Read in Arabic)

Dana Gas achieves significant milestones with Egyptian growth plans
ADX Press Release | 01 Feb 2015
Dana Gas filed a statement to the Abu Dhabi Securities Exchange announcing the achievement of “significant milestones” in Egypt. The milestones include the repayment of USD 60 mn (28% of all receivables) from the Egyptian government following the signing of a Gas Production Enhancement Agreement. Dana Gas has become the sixth largest oil and gas producer in Egypt after increasing production by 8% y-o-y with gas, LPG, condensate, and crude output growing to around 40,000 barrels of oil equivalent per day. (Read)

Plans to import 1 bcf of LNG by 2018, gas shortage reaches 700 mcf currently – Minister of Petroleum
Amwal Al Ghad, Al Borsa | 01 Feb 2015
The Minister of Petroleum announced that the shortage of natural gas in Egypt is around 700 mcf. This amounts to 15% of the domestic market’s demand. The Minister also said that he is overseeing initiatives to increase production and increase the number of houses connected to the natural gas grid. Al Borsa published part of the Ministry’s plans for natural gas which expects the amount of LNG Egypt imports to double to 1 bcf by FY2017/18. (Read in Arabic and here)

MANUFACTURING

FEI denies planned price increases starting this week
Al Ahram | 01 Feb 2015
Federation of Egyptian Industries’ chairman Mohamed El Sewedy denied reports of planned price increases of manufactured goods as a result of the devaluation of the Egyptian pound. El Sewedy expects the prices of some products to stabilise and if there are any increases they will be limited to 2-5%. There should be no significant increases in prices as manufacturers were already factoring in the black market foreign currency exchange rate. (Read in Arabic)

REAL ESTATE

Ministry of Housing and Arabtec begin steps to implement 1 mn homes project
Al Borsa | 01 Feb 2015
The Ministry of Housing handed over plots of land to Arabtec on a preliminary basis to begin implementing the million-homes affordable housing project. A source told Al Borsa that Arabtec had presented its design plans to the ministry for the first phase of the project in Badr, Obour, and New Minya cities. Arabtec is currently assessing bids for the contracting part of the project, with contenders including OCI, NCCD Mokhtar Ibrahim, and Hassan Allam. (Read in Arabic)

EFSA finalizes new real estate valuation standards
Al Mal | 01 Feb 2015
The Egyptian Financial Supervision Authority has finalized the standards for real estate valuation, which aims to add confidence and objectivity to the regulations, according to Al Mal. The EFSA launched the initiative to develop the new standards and assigned a committee to supervise the project and finally added its results in the Egyptian Real Estate Valuation guidelines. (Read in Arabic)

TELECOMS

Global Telecom to sell 51% stake in Djezzy, will still retain operational control
Reuters | 01 Feb 2015
Global Telecom Holding (GTH) announced the sale of a 51% stake in Algerian mobile operator Djezzy to the Algerian National Investment Fund. GTH will retain operational control over Djezzy despite the sale in accordance with a shareholder agreement that creates a public-private partnership. The CEO of VimpelCom (GTH’s Russian parent firm) said “the deal, on a group level, also releases significant cash amounts to GTH and VimpelCom to pay down gross debt.” (Read)

Link to being providing internet service through fiber-optic cable this month
Amwal Al Ghad | 31 Jan 2015
Linkdotnet, a subsidiary of Mobinil, announced it reached an agreement to begin using Telecom Egypt’s optic-fiber cable infrastructure to provide its internet service. Link will use the optic fiber cable infrastructure instead of copper wires. TE is currently replacing copper-wire infrastructure with fiber-optic cable in a project that is expected to be completed by the end of 2015. Yves Gauthier, Mobinil’s CEO, believes that TE’s drive to shift to fiber-optic cables is monopolistic as they caused service disruptions to over 20,000 of Link’s customers and drove some to switch to TE-owned TE Data. (Read in Arabic)

EGYPT POLITICS + ECONOMICS

French business delegation postpones trip to Egypt
Al Mal | 01 Feb 2015
The French Chamber of Commerce postponed a conference that was planned with a French business delegation assessing investment opportunities in Egypt. Sources told Al Mal the reason behind the cancellation is the preoccupation of Egyptian government officials with Vladimir Putin’s anticipated visit. (Read in Arabic)

Renaissance Dam negotiations continue, Egypt and Ethiopia call for dam evaluation plans
Al Mal | 31 Jan 2015
Egypt’s Minister of Water Resources and Irrigation Hossam Moghazy met with his Ethiopian counterpart Almayo Tengo in Addis Ababa to decide on an advisory firm to evaluate the Renaissance Dam project. The talks included Sudan’s Water and Electricity Minister, who joined in by phone, and all parties agreed to invite five consulting practices to present their offers to conduct the assessment this month, with bids including plans requiring more than 12 months set to be disregarded. A source close to the discussions said all parties are hoping to have the dam assessments conducted expediently, but refused to comment on why the contract has not yet been awarded. (Read in Arabic)

MOF approves EGP 5.1bn loan for ministries
Al-Mal | 1 Feb 2015
Minister of Finance Hany Demian approved an urgent EGP 5.1bn financing package for the ministries of Electricity, Health, Justice, Supply, Petroleum, and Housing. (Read in Arabic)

USD 15-20 bn in investments expected from Egypt Economic Development Conference
Al Borsa | 01 Feb 2015
The Egypt Economic Development Conference in Sharm is expected to attract USD 15-20 bn in investments, according to Minister of Investment Ashraf Salman during a press conference. The press conference was attended by the Prime Minister Mehleb as well as Saudi Arabia’s Minister of Finance. The latter noted that Saudi investors remain eager to increase their exposure to Egypt. (Read in Arabic)

REGIONAL

Algeria’s Skikda gas plant shuts LNG unit for maintenance -Source
Reuters | 01 Feb 2015
Algeria’s Skikda plant has closed a 4.7 mn ton / year LNG unit for maintenance for up to a month and a half after having already been shut down shut down for two weeks due to maintenance and poor weather conditions, according to a source at state energy company Sonatrach speaking to Reuters on Sunday. Last week, a shipping source told Reuters that some Skikda cargoes were canceled or deferred, saying that one cargo was due to be exported in the next few days and another around 20 February. (Read)

ON YOUR WAY OUT

Ezz DK records a net loss of EGP 205.4mn vs. a net profit of EGP 789.9mn in 2013, Al-Masry Al-Youmreports.

BY THE NUMBERS

USD CBE auction (Sunday): 7.5101 (+0.02 from Thursday’s sale)
USD parallel market (Sunday): 7.89 (+0.02 from Saturday)

EGX30 (Sunday): 9,779.76 (-0.64%)
Turnover: EGP 513.0 mn (25% below the 90-day average)

WTI: USD 46.88 (-2.82%)
Brent: USD 51.66 (-2.51%)

TASI: 9,143.9 (+3.0%)
ADX: 4,552.6 (+2.2%)
DFM: 3,840.2 (+4.5%)
KSE: 445.4 (+0.08%)
QE: 12,062.1 (+1.4%)
MSM: 6,572.2 (-0.2%)

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