World Bank sees 4.7% growth next year. TE faces antitrust probe. US delivers vessels to Egyptian Navy. Healthcare spotlight. New tariff structure for mobile, internet? Beltone Capital to list.

A NOTE FROM THE EDITOR: We have an important correction to the email edition dispatched this morning: Osama Bishai remains CEO of Orascom Construction. There has been no change in its board of directors or management. The disclosure that we cited was made by Orascom Construction Industries (اوراسكوم للإنشاء والصناعة) S.A.E not Orascom Construction Limited (اوراسكوم كونستراكشن). The web version of today’s edition (below) has been edited to reflect this. A clarification on the subject is available on OC’s website.

We regret the error and extend our sincere apologies to Osama and everyone at Orascom Construction

WHAT WE’RE TRACKING TODAY

According to the nice people at Islamic Finder, iftar will be at 7:00pm, while the cutoff for sohour will be 3:09am.

WHAT WE’RE TRACKING NEXT WEEK

A tripartite meeting between Egypt, Sudan and Ethiopia will be held in Cairo from 1-3 July to discuss the studies conducted by two international consultancy firms on the impact of Ethiopia’s Grand Ethiopian Renaissance Dam. If all parties approve of the studies’ findings, they are set to sign off on them on 11 July. (DNE)

LAST NIGHT’S TALK SHOWS

Lamees El Hadidy made her first Ramadan appearance last night in a more condensed version of her usual three-hour talkfest.

“It’s Ramadan and it’s a typically crowded month. The streets are crowded and television is crowded,” said Lamees, in her usual dulcet tones. “This year we have too much drama and too much advertising, with the result being that confused viewers are unable to follow much of anything. We are watching three minutes of drama and 15-20 minutes of advertising. I don’t think that is by any means an acceptable split, but is it an indicator that the economy is doing well? Does this huge volume of ads mean that Egyptian companies are back to having large advertising budgets?”

After a rundown of the headlines — including the release of Al Jazeera journalist Ahmad Mansour El Hadidyin Germany — Lamees held a long discussion about Ramadan television.

“Egyptian women cannot all be belly dancers, police officers cannot all be evil, and businessmen cannot all be corrupt.” She did however point out that there are few good works of drama this year, including H7aret El Yahood and Tah7t El Saytara.

Samy Abel Aziz, the former dean of the college of mass communications at Cairo University, also called in to complain about too much advertising. “No one can deny that advertising is important, because without it there would be no television, but commercials should only occupy 10-15% of the total airtime of any show, and this is not what we are seeing at the moment. You can’t see the same ad 3-4 times within one commercial break because the ads begin to lose their meaning, even the good ones.”

Abdel Aziz was also critical of the charity organizations and NGOs that have been bombarding viewers with pleas to donate to their causes. “We are starting to look like beggars in front of the Arab world. Also the use of sick and handicapped children in those ads raises some question marks. They are exploiting these children and suffocating people to the extent that the ads are having a negative effect on the naturally charitable nature of Egyptians during the month of Ramadan.”

El Hadidy reminded viewers that Minister of Communication and Information Technology Khaled Negmhas not kept his word. Negm promised on her show last month that Egyptians would experience a noticeable improvement internet service at lower prices by the beginning of June, which has obviously not happened.Negm called in and blamed the delay on the change in management at Telecom Egypt.

“I hope that we can have better internet soon. We really need it as people are now watching all the Ramadan series on YouTube without commercial interruption,” said El Hadidy.

** READ ENTERPRISE IN ARABIC **

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SPEED ROUND

The World Bank Group team, led by Ahmed Kouchouk, released its spring 2015 Egypt Economic Monitor. Kouchouk and company expect Egypt’s GDP to grow at 4.7% y-o-y in FY2015-16 and 4.3% y-o-y in FY2014-15 driven by:

• Strong private consumption as remittances remain resilient, civil servants take home more in their pay packets, and inflation is subdued.
• Growth in public and private investments.

The WBG sees economic growth breaking the 5% barrier if structural problems are addressed including:

• The cumbersome business environment
• Labor market conditions are addressed
• If the reforms take place, the output gap could possibly disappear in as early as FY2015/16.

The WBG expects inflation rates to remain steady at an average of 10% through FY2016-17, but believe that the Finance Ministry will miss its target and will record a budget deficit of 11.5% of GDP in FY2015-16, with it only reaching the 10% to GDP deficit target in FY2016-17. However, the report lists four risks that could affect Egypt’s economic performance:

• The security situation;
• Possible policy slippage given the ambiguity surrounding the timing and implementation capacity of some policy;
• The speed in which social safety nets can be implemented to soften the impact of reform measures;
• Uncertainty surrounding the financing of mega-projects.

At Enterprise, we noticed that the report based its projections on oil prices at USD 80 per bbl. However, the government is projecting oil to be at USD 70 per bbl on average in FY2015-16. If the government’s projection turns out to be true, then the WBG expects GDP growth to be 0.2% higher, inflation to be 0.4% lower, and fuel subsidies 0.21% of GDP lower, but the balance of payments deficit is set to widen by 0.33% of GDP. The report also includes addenda analyzing the tax and investment law reforms as well as Egypt’s energy sector. The landing page of the report is here, but you can skip it and download the report in pdf here, if you like

World Bank chief on Egypt: The Wall Street Journal sat down with WBG chief Jim Yong Kim to talk about “progress in emerging markets.” In that context, Kim noted: “People have said that the Arab world is like a tent with two poles. One is Saudi Arabia and one is Egypt, and both have to be stable for the region to be stable. We’ve done a lot of work in Egypt over time. I met with President el-Sisi, and I was very impressed with his commitment to tackling major issues. Having said that, there are challenges. I went to Luxor. Egyptian antiquities are one of the great resources for the entire world. It’s really stunning. But at the same time it’s one of the very poorest regions. There’s a huge agenda with Egypt.”

Egypt signed a deal with BP to import LNG: BP will supply EGAS with 16 LNG cargoes through 2015 and 2016. As part of a tender in January to import 70 LNG cargoes, BP was supposed to supply 21 cargoes, but delays to signing a deal reduced the number of deliveries, sources said. “This deal was meant to form part of a major tender Egypt awarded in January to buy 70 LNG cargoes, worth about USD 2.2 bn, but recurring delays threw the deal with BP into doubt as Egypt scrambled to cover its energy needs,” Reuters reported.

Picking up where we left off yesterday: The Egyptian Competition Authority has opened an investigation into Telecom Egypt’s practices following accusations put forward by CIT Minister Khaled Negm, a source told Al Masry Al Youm. The source added that this is the first time a sitting minister accuses a company of antitrust violations. He added that it was expected that mobile network operators would be the parties submitting the complaints against TE. The fixed-line monopoly is also under attack by internet service providers alleging that its majority-owned subsidiary TE Data has engaged in anticompetitive practices to accumulate a 70% market share.

With three days left to go, the Egyptian public offering of Emaar Misr’s IPO is 1.3x oversubscribed, according to reports in the domestic press. As we reported earlier this week, Emaar Misr priced the offering at EGP 3.80 per share and expects a market cap at listing of c. EGP 17.6 bn. The now-closed institutional offering was 11x oversubscribed; the Egyptian public offering closes on Thursday, 25 June. EFG Hermes and JP Morgan are the joint global coordinators and joint bookrunners for the Emaar Misr offering.

EFSA has published Egypt’s first real estate valuation standards, which will come into effect on 1 July with the start of the new state fiscal year. All financial institutions will be required to abide by them when valuing real-estate assets, Al Borsa said.

Investment Minister Ashraf Salman gave GAFI staff a pep-talk yesterday that, stripped to its bare essence, reads as: “Thanks for the EEDC. You need to do more work, to a higher quality standard, and faster. Oh, and you’re probably going to be working longer hours.” Ahram Gate has the readout here. The meeting with GAFI-types comes just a week after Salman suggested in a meeting with President Abdel Fattah El Sisithat GAFI’s working hours could be extended to midnight.

The Cabinet Economic Group met on Monday, with attendees including the ministers of industry, supplies, planning, electricity, transport, social solidarity, and investment as well as the governor of the CBE. Electricity and power generation dominated the meeting, according to cabinet spokesman Hossam Al-Qaweesh. The group explored the progress of the Siemens electricity projects and a slew of other power plants and renewable energy projects, Al Masry Al Youm reports. The meeting also looked into bolstering charities and reforming schools in the governorates in addition to planning out details of the upcoming Upper Egypt Investment Conference, according to  Al Ahram. Key meeting outcomes include:

• Formation of a joint stock company to coordinate and manage the installation and operation of power plants to help cover demand this summer and beyond;
• Financing the company’s operations through state investments, loans and possibly an IPO;
• Setting a pricing scheme for the energy produced;
• Mandating the General Authority for Supply Commodities to increase imports of commodities such as cooking oil in order to ensure affordable pricing on the market;
• Increasing subsidies to Egyptian exports to EGP 5 bn from EGP 2.6 bn on the request of the FEI.

Quoth the FT: “The west opens up to Egypt’s President Sisi.” The salmon-colored paper’s editorial board is running with a piece criticizing what it characterizes as the West’s embrace of El Sisi, warning of increased chaos in Egypt if the death sentences against Morsi and the rest of the Ikhwan leadership gang go through.

Speaking of those cozying-up to Egypt: The United States has delivered two Fast Missile Craft to Egyptian Navy, doubling the navy’s fleet of the maritime and regional security vessels to four, according to a statement from the embassy that has been picked up by Reuters and the domestic press. The statement quotes the U.S. Embassy’s Maj. Gen. Charles Hooper as saying: “The Fast Missile Craft directly supports maritime and regional security, which includes protecting vital waterways such as the Suez Canal and the Red Sea.  This delivery is a sign of America’s ongoing commitment to Egypt and to our shared security interests in Egypt and the region.” In similar news, defense chief Sedky Sobhi arrived yesterday in Paris for high-level talks with his French counterparts, Ahram Online reports, in the latest example of deepening ties between Paris and Cairo. Egypt signed this year a EUR 5.2 bn deal to purchase French Rafale fighter jets and awarded VINCI Bouygues Travaux Public a contract to complete the fourth phase of the third Cairo Metro line with French financing. French companies were active participants at EEDC and France’s top business association recently sent a high-profile trade delegation to Cairo.

Egypt’s endowments ministry to remove ‘extremist books’ from mosques: The Minister of Awqaf Mohamed Mokhtar Gomaa on Monday issued orders to remove all books and audiovisual media that incite violence and radicalism from mosque libraries around the country, according to Al-Ahram Arabic and asreported by Ahram Online.

Germany will not extradite detained Al Jazeera journalist Ahmed Mansour to Egypt. “No one will be extradited from Germany if they face the death penalty,” a spokesman for the German foreign ministry said according to Reuters.

Four bidders are seeking to acquire CIB and Legal & General’s stakes in Commercial Life Insurance (CIL) Al Mal reports. The bidders include Bahrain’s AXA Group, which recently obtained a license to operate in Egypt, and UK-based Prudential Financial, which the paper says has been attempting to enter the Egyptian market for the last four years.

“Egyptians pull kids from classes as schools blight economy.” Salma El Wardany and Caroline Alexander write in Bloomberg on Wafaa Bassiouny’s attempts to mainstream the concept of home-schooling in Egypt following concerns over the quality of education school children are receiving in the nation’s schools. The move signifies the utter loss of confidence in the Egyptian education system which has been constantly ranked as among the worst. It is also significant as it provides an alternative to the increasingly expensive private schools. If successful, this could undercut a tutor system which has been the bread and butter for most teachers in public schools.

Mona Zulficar, the high-profile corporate lawyer and non-executive chairperson of EFG Hermes, wasnamed first head of the Egyptian Microfinance Association on Monday, making her, in effect, the chief spokesperson for the fast-growing industry.Mohamed Mashhoor, who heads Banque du Caire’s retail banking division, has been named as her deputy.

“Potemkin. Paging Prince Potemkin”: A delegation of human rights activists visited a new central detention facility designed to serve as a pre-trial detention facility for the capital city — the Rikers Island of the Cairo Security Directorate, if you will. The 4,000-detainee facility is presently home to some 3,020 people.Ahram Online notes that pre-trial detention can, since late 2013, be extended indefinitely and says the delegation noted the 15 May facility is “designed in a modern style to ensure a minimum level of decent living and health care.” The Interior Ministry has opened five prisons in the past two years, bringing the total to 42 nationwide; two more are due to open in the coming months, the paper says.

EgyptAir strikes back — again and again. EgyptAir just doesn’t get Google. The national flag carrier is decrying a five-year-old listicle on Business Insider suggesting EgyptAir is the ninth-worst airline in the world. After first answering back three months after the initial ranking was published, EgyptAir is at it once again. Al-Borsa says the airline believes the story keeps coming up because of malicious campaign designed to discredit it. It may have more to do with, well, Google: The BI story is the top hit on a search for “EgyptAir ranking”.

A year after being elevated to MSCI emerging markets status along with Qatar, the UAE just sent a major signal it may be serious about luring foreign investors to its bourse: The National reported last night that “the government has lifted the restriction on foreign ownership of Etisalat shares, opening up the country’s biggest publicly traded company to overseas investors for the first time.” Foreign investors will be allowed to hold up to 20% of the company. The newspaper cites a recent EFG Hermes Research report, saying “Opening up UAE publicly traded companies to increased foreign ownership is key to keeping up with emerging markets requirements, EFG-Hermes said last week. ‘We believe that the most important criteria to address is openness to foreign ownership,’ the bank said.”

“Exercise is not a vaccine against heart disease,” the WSJ reminds us after the death of JP Morgan vice chairman James B. Lee, who died after becoming short of breath while exercising. If you’re over 35, male and work in a high-stress job, you might want to give the story a read. The tl;dr: “There is unequivocal evidence that regular physical activity and exercise have multiple benefits that far outweigh any risk of the exercise itself,” says one expert. “Middle-aged men in high-stress jobs need to get a checkup once in a while,” adds another.

CORRECTION: Haim Koren is Israel’s ambassador to Egypt, not the Israeli Foreign Minister. The FM’s post is actually vacant at present. H/t DJR + Karim N.

***
A MESSAGE FROM PHAROS HOLDING

On the new state budget and Ramadan performance of the EGX

On 18 June, the Egyptian cabinet issued a statement summarizing the draft budget for FY16, prior to sending it to President Abdelfattah Al Sisi for review and approval. Pharos Research recorded the most notable projections made, namely GDP growth of 5.0% (vs. 4.2% in FY15) and a budget deficit standing at 9.9% of GDP (vs. 12.0% in FY15). In addition to that, the statement also pointed out that EGP 61 bn will be allocated to fuel subsidies over the course of the fiscal year, 13% below the amount earmarked for the previous one (EGP 70 bn).

Meanwhile, the EGX hit a two-year low in market turnover, with shares worth EGP 152.6 mn changing hands on Monday, affirming the stock market’s usual soft performance during the month of Ramadan. Read more of our Market Note here.
***

SPOTLIGHT ON Crisis in the public health system
(and its roots in finger-pointing within the medical establishment)

No airing dirty scrubs: The ongoing feud between the Egyptian Medical Syndicate and Health Minister Adel Adawy recently took a sharp turn for the worse, when the minister ordered state-funded hospitals and clinics to force doctors to sign non-disclosure agreements preventing them from publicly discussing conditions at state facilities, Al Mesryoon reports. The move comes after a month-long campaign on social media that has seen physicians catalogue appalling conditions at state hospitals.

The Egyptian Medical Syndicate criticized the decision, saying the minister’s attitude is emblematic all that is wrong with healthcare in the country. Ehab Taher, head of the Cairo branch of the syndicate, countered that physicians have a constitutional right to express themselves on the issue and reiterated his organization’s call for Adawy’s resignation and, of course, healthcare reform.

Gov’t response to crisis: In response to Prime Minister Ibrahim Mahlab’s call to improve health care in underprivileged communities, Adawy has filled his diary with meetings and inspection tours. He held a meeting on Saturday with the heads of Azhar University’s faculty of medicine and hospital to develop a plan to reform the quality of service and how to better coordinate it with the ministry, Al Shorouk reports.

He also conducted a surprise visit to Family Healthcare Center on Monday, where he announced the formation of an inspection team which would make the rounds of hospitals. Adawy also urged more inspections of the quality of foods being offered in the market in light of the “donkey meat” scandal which came up this month, Youm7 reports. He also inspected Cairo hospitals and Sovaldi distribution centers.

Media-savvy reform plan? The minister’s tours culminated in him issuing five directives, the most important of which is to extend the working hours of doctors. According to Al Masry Al Youm, the move further incensed the Egyptian Medical Syndicate, which has accused the minister of pandering to the media without addressing the root causes of problems in the system. The chairman of the EMS stated that the move will drive doctors to quit the morning shift (where medical services are offered for free) and will fail to bring meaningful change.

Background: When Prime Minister Mahlab made an impromptu inspection of state hospitals in early June, the flood gates opened to criticism of the dilapidated state of the Egyptian healthcare system. The flap has crossed into the international media: The Economist published a piece we noted yesterday, stating that despite a 27% increase in spending, healthcare expenditure by the state remains only 1.75% of GDP, falling short of the constitutionally mandated 3%. Local new sources continue to scour state-run clinics and hospitals and continue to uncover horrid conditions, such as this hospital in Qalyubia. Spearheading this campaign were the doctors on the frontlines themselves, who have not been shy to report incidents after what they claim was Mahlab blaming them for the state of healthcare — a state they blame squarely on the government’s lack of commitment.

EGYPT IN THE NEWS

Erdoğan criticizes Germany for arresting Al-Jazeera journalist on Egypt’s request: “European states, which leave Turkey alone in fighting terrorism and condone terrorist organization members, unfortunately behave very differently over a request by coup stagers,” Erdoğan is quoted as saying by Daily Sabah. Erdoğan, who always seems to find the time to comment on nearly everything that happens that has to do with Egypt, has his own problems to deal with, as he breaches his own constitutional mandate in interfering with the potential formation of a coalition government after his AK Party failed to secure a majority in Turkey’s recent parliamentary elections. “I know how to exercise my powers under the constitution quite well,” he said. “I don’t need orders from anyone on this.” (Read in Bloomberg)

WORTH READING + WATCHING

Al Jazeera’s Ahmed Mansour’s interview with Jabhat al-Nusra leader: Al Jazeera journalist Ahmed Mansour was released from detention in Germany on Monday, where he had been held under request from Egypt. Berlin’s public prosecutor said Germany cannot extradite an individual who could potentially face the death penalty abroad. Mansour was sentenced in absentia to 15 years in prison on charges of torturing a lawyer in Tahrir Square in 2011.

Mansour recently conducted a fawning interview with Abu Muhammad al-Julani, the founder and leader of the Al-Qaeda-linked terror group Jabhat Al Nusra. The segment aired on Mansour’s program “Without Borders” on 27 May. Mansour attempts to rehabilitate Nusra’s image to the world as he asks “You don’t do any of those things you’re accused of in the Western press, do you?” while Al-Julani answers with his face hidden from view. Among the highlights of the interview, Jolani confirms that there is no such thing as the Khorasan group, and says that Al Nusra is not planning on waging war on Christians “yet.”

The entire interview is available here, (Watch in Arabic, running time: 51:25), alternately, MEMRI has a few segments of the interview with English subtitles available here and here, (running times 4:18 and 8:50, respectively).

Hassan Hassan, associate fellow at Chatham House’s Middle East and North Africa Programme, and co-author of “ISIS: Inside the Army of Terror” recently wrote for The National a good breakdown of the interview titled Jabhat Al Nusra leader reveals his true colours. “Perhaps Al Jolani’s most significant remarks are his statements about the Muslim Brotherhood. He said that the Muslim Brotherhood has ‘deviated’ from Islamic teachings when they accepted modern democratic norms. His contempt for the organisation is a surprising move by the group that is intended to build influence within various conservative segments of Syrian society.”

ALSO WORTH READING + WATCHING

No Time to Be Nice at Work: The most-read article on the New York Times site at the moment is their Sunday Review opinion piece on the deleterious effects of discourtesy in the workplace — and findings that point to a marked decrease in productivity as a result. The following passage should have particular relevance to Egyptians, as the Arabic word for “nice” [tayyeb] in Egyptian parlance is often a direct synonym for “stupid”: “There can be a perceived inverse relationship between warmth and competence. A strength in one can suggest a weakness of the other. Some people are seen as competent but cold — he’s very smart, but people will hate working for him. Or they’re seen as warm but incompetent — she’s really friendly, but probably not very smart.” However, the article points to studies conducted by the author Christine Porath and her co-researcher Amir Erez which demonstrate “people working in an environment characterized by incivility miss information that is right in front of them. They are no longer able to process it as well or as efficiently as they would otherwise.” (Read)

Lastly, because BuzzFeed destroyed the internet, the above article features a quiz: How Toxic Is Your Work Environment? (Take the quiz. Unless you work at Enterprise, of course. Or Inktank. Or…)

But what about those of us who find it difficult to live without being difficult? We feel your underreported pain, and for you we are re-upping a video as a bookend that we previously featured in Enterprise: A Collection of Insults from Veep, (Watch, running time: 4:21) Also, see: Larry David’s Curb Your Enthusiasm Insult Supercut (Watch, running time: 2:55)

DIPLOMACY

In secret meeting, Israel and Turkey renew reconciliation talks: In a story that Haaretz broke and has since been picked up by Turkish daily Zaman, Israeli and Turkish senior officials reportedly held secret meetings in Rome on Monday to effect a reconciliation. Normally pragmatic and cordial relations between the two states broke down following Israel’s boarding and subsequent killing of 9 Turkish nationals aboard the Mavi Marmara aid convoy that was headed for Gaza. Despite Israeli Prime Minister Benjamin Netanyahu’s belated apology in 2013, relations have yet to return to where they were. (Read in Haaretz, paywall, and inZaman)

Meanwhile, the AP reports on a Jordanian thinktank focused on Israel, in a piece that highlights the dichotomy between the functional and practical relations that Israel has with its Arab neighbors versus official rhetoric and generations raised upon hatred of the Jewish state. “Oded Eran, a former Israeli ambassador to Jordan, said he believes some Jordanians are re-evaluating their country’s relationship with Israel, but that real peace would likely only be possible if progress is made toward an Israeli-Palestinian deal.” (Read in AP)

ENERGY

Egypt might have to agree to import Israeli gas, source says
Al Borsa | 22 June 2015
Egypt might have no option but to import natural gas from Israel, a source told Al Borsa. The obligation could come in order to supply the liquefaction facilities in Idku and Damietta. The source said Union Fenosa Gas has agreed to drop the arbitration case filed against Egypt only under the condition that it is allowed to import gas for its liquefaction plant. He added that the Egyptian government remains hesitant about an Israeli deal due to political consideration. (Read in Arabic)

Shell’s oil production in Egypt maintained at 130,000 bpd, MD says
Daily News Egypt | 21 June 2015
Shell has managed to maintain oil production rates at 130,000 bpd, MD Aidan Murphy told Daily News Egypt in an interview. “This way, it avoided a huge decline in the production of most petroleum and tanks, especially with the hard work on the Assil and Karam project in its concession area Badr El Din 3,” Murphy said. He added that Shell’s JV Bapetco will drill 50 new wells in the Western Desert this year to support a high rate of production. Murphy did not refer to fracking operations with Apache in the Western Desert, choosing, instead, to refer to them as the operations to drill “two vertical wells in Apollonia field in order to collect data and determine the best sites for the three horizontal wells and their design.” (Read)

Ministry of Supply signs cooperation protocol with Ministry of Petroleum and ACPA
Amwal Al Ghad | 22 June 2015
The Ministry of Supply signed a cooperation protocol with the Ministry of Petroleum and the Alexandria Company for Petroleum Additives (ACPA) to repurpose used cooking oil into diesel manufacturing. The protocol will involve the ministry of supply collecting the used oil from citizens in exchange for basic commodity points, and sending them off to ACPA. (Read in Arabic)

BASIC MATERIALS & COMMODITIES

Egypt looking to pay for Russian wheat in rubles
Reuters, AMAY | 22 June 2015
We’ve come full-circle: After Egypt agreed earlier this spring to accept payment from Russian tour operators in ruble, Supply and Domestic Trade Minister Khaled Hanafi. A Russian trader reached by Reuters said, “The payment in roubles would ease the risk of currency volatility for Russian suppliers, but the question where Egypt would find the roubles to pay remains in place.” The answer, we would suggest, would be from tourism receipts, if that agreement is actually working. As we noted yesterday, Al-Masry Al-Youm reported that Russia’s Sistema RZ Agro Holding would be willing to sell Egypt wheat on ruble-denominated contracts. (Read)

Metallurgical industries chamber calls on CBE to improve USD availability
Al Borsa | 22 June 2015
The Chamber of Metallurgical Industries is calling on CBE to improve the availability of USD urgently to allow factories access to imports. The Chamber’s secretary expects a market shock as demand from real estate increases with steel factories’ supply unable to keep up. He added that factories are operating at 60-80% capacity. (Read in Arabic)

Cotton exports up 23% this season
Al Mal | 22 June 2015
Cotton exports in the current season are up 23% year-on-year to 48,000 tons. Cotton Exporters Association head Mofreh El Beltagy attributed the rise of exports to lower Egyptian cotton prices in the international market.

MANUFACTURING

221 industrial projects worth EGP 3.133 bn approved says Trade and Industry Minister
Al Mal | 22 June 2015
Minister of Trade and Industry Mounir Fakhry Abdel Nour announced a 130% increase in the amount of approved industrial projects and their net worth. He added that 221 industrial projects worth EGP 3.133 bn received final approval in May of this year, while the same statistics from last year showed 96 projects worth EGP 1.219 bn. Abdel Nour added the projects spanned the chemicals, basic commodities, construction and textile industries among others. (Read in Arabic)

HEALTH & EDUCATION

Pharmaceutical companies to participate in business delegation to Kazakhstan
Al Borsa | 22 June 2015
15 companies operating in the pharmaceuticals and medical sector are participating in a business delegation trip to Kazakhstan in September organized by its export council of medical industries. The visit is set to be the second this year promoting Egyptian products in Kazakhstan and to open new markets. Egypt’s export council of medical industries hopes to sign USD 50 mn worth of MoUs during the visit following the successful visit by five companies in May. (Read in Arabic)

Minister of Education, El Sisi discuss Egypt’s education strategy
Al Mal | 22 June 2015
Minister of Education Moheb El Refaie met with President Abdel Fattah El Sisi on Monday to discuss the ministry’s strategy for improving the country’s education system. El Refaie told the president that construction of 100 new schools will be completed by the end of June 2015. The minister also provided El Sisi with an overview of the ministry’s disciplinary-code, which aims to put an end to bullying and violence throughout Egypt’s school system. Additionally, El Refaei discussed the ministry’s efforts to improve students’ reading and writing abilities — and to create a school for high-achieving students. El Sisi told the minister there should be a school for high achievers in every governorate, according to the meeting readout. (Read in Arabic)

REAL ESTATE & HOUSING

NUCA issues three tenders
Al Borsa | 22 June 2015
The New Urban Communities Authority will issue three tenders for projects in Sheikh Zayed and New Beni Suef. The continuation of the electrical and power grid projects in the thirteenth district will also be issued in a public tender between the companies listed in the Egyptian Federation for Construction & Building Contractors. (Read in Arabic)

TELECOMS & ICT

MCIT mulls tariff restructuring for all communication services
Al Borsa | 22 June 2015
The MCIT is considering a comprehensive overhaul of Egypt’s tariff structure for communications services, Al Borsa reports, including fixed and mobile communications, as well as all forms of internet connectivity. MCIT is also mulling the possibility of imposing additional charges on users of e-banking and cash transfer services. The MCIT has entered into talks with communications providers in order to discuss the tariff restructuring. The ministry has also requested that the NTRA provide it with information on their cost base to take into consideration during negotiations. (Read in Arabic)

AUTOMOTIVE & TRANSPORTATION

Nissan Egypt to finish pumping USD 70 mn in investments by 2016
Amwal Al Ghad | 22 June 2015
Nissan Egypt will finish pumping its planned USD 70 mn in investments in Egypt by 2016, the car manufacturer’s regional manager said. Nissan hopes to increase its car sales in Egypt to 30,000 vehicles in FY2015/16 from 28,927 last fiscal year. The company has a 10% market share, the regional manager said, putting it in second place amongst the international brands. He also expects the elimination of the import tariffs that is scheduled for 2019 to hurt domestic manufacturers severely. (Read in Arabic)

AVIC to submit implementation report for train assembly plant
Al Mal | 22 June 2015
Chinese manufacturing group AVIC is set to present in August its technical and financial offer to build a USD 500 mn train assembly plant, a senior advisor to the Transport Minister said yesterday. The first phase will focus on the assembly of rolling stock and will carry an investment cost of c. USD 100 mn. The Transport Ministry has met with four Chinese banks in the past week — including the China Development Bank — to discuss financing for the project. We reported during the Egypt Economic Development Conference in Sharm that the Chinese company had inked a USD 1 bn deal to manufacture rolling stock and develop rail assets. Groundwork had been set during President Abdel Fattah El Sisi’s trip to Beijing. (Read in Arabic)

BANKING & FINANCE

Beltone Capital to float shares on EGX
Al Borsa | 22 June 2015
Beltone Capital Holding submitted its documents to float 58,446,431 shares on EGX worth EGP 580.45 mn at EGP 10 per share. Beltone Capital chairman Hazem Barakat had previously stated his company was looking to make USD 130-150 mn by floating 35-45% of its capital shares. The revenue was needed to fund numerous projects, the most noteworthy of which was an energy project with Total. (Read in Arabic)

EGYPT POLITICS + ECONOMICS

Mahlab assess preparations for Upper Egypt economic conference
Al-Ahram, Amwal Al Ghad | 22 June 2015
PM Mahlab held a meeting yesterday to assess the preparations for the Upper Egypt economic conference currently being planned, reports Al-Ahram. The meeting was attended by the Ministers of Local Development, Manpower, Investment, and Interior. The Investment Minister said Hurghada was chosen to hold the conference as it has cities with ballroom capacities large enough to host over 2,000 invitees along with its larger number of hotel rooms. The conference will look to attract investment in the ten cities of Upper Egypt and the Red Sea. (Read in Arabic)

ON YOUR WAY OUT

Negotiations with representatives from Arabtec on its 1 mn homes project are set to continue within a week, an assistant to the Housing Minister told Amwal Al Ghad.

There are 72 licensed NGOs operating in Egypt legally, the Minister of Social Solidarity said after granting Action Against Hunger the right to operate in the country.

The Social Solidarity Ministry began registering potential recipients of Takaful and Karama transfer payments in Cairo’s informal settlements in Boulak El Dakrour, Al Shorouk reported. The Ministry will begin recording recipients in Qena and Aswan after the end of Ramadan.

The Interior Ministry has hardened the security of Cairo Metro stations and tunnels with the installation of 42 explosives trace detectors as well as the setup of both fixed and mobile security checkpoints. The news came in the context of an Interior Ministry security update that received widespread attention in the local press yesterday.

Army digs trench along Gaza border to prevent smuggling: Reuters reported on Monday that “Security sources said passages had been made for vehicles and for pedestrians. They said the U-shaped trench is two kilometers away from the border and will have a depth of 20 meters and a width of 10 meters.” (Read)

Egyptian security forces killed 22 suspected militant in North Sinai on Monday, reports Reuters. “ Security forces struck a group of people meeting outside a mosque south of the Sheikh Zuwayed town who were planning an attack on security points. They also targeted a vehicle with four militants and two more riding a motorcycle.” (Read)

BY THE NUMBERS

USD CBE auction (Sunday, 21 June): 7.5301 (unchanged since Monday, 02 Feb)
USD parallel market (Sunday, 21 June): 7.67 (-0.01 from Sunday, 07 June, Reuters)

EGX30 (Monday): 8,489.41 (-0.54%)
Turnover: EGP 375.3 mn (21% below the 90-day average)

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