EUR 1.8 bn in French agreements — and counting

TL;DR

1. El Sisi, Hollande sign 18 agreements worth EUR 1.8 bn on day one of French president’s visit; expect arms pacts to be announced today.
2. Russian delegation in Cairo to inspect airport security.
3. EFSA passes regulations on cross-ownership, minority rights protections
4. International oil company receivables inch up USD 200 mn in March- Oil Ministry
5. Egyptian Businessmen’s Association wants international companies to run airports in tourist cities
6. Orange to develop network infrastructure, float shares
7. GM injects EGP 110 mn in Egypt to assemble Chevy Optras
8. EFG Hermes Leasing to double market share in 2016, looks to capital increase in 2017
9. By the Numbers

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WHAT WE’RE TRACKING TODAY

A delegation from Russia arrived in Cairo yesterday for a seven-day visit to review airport security, the Civil Aviation Ministry said in a statement. The delegation will work with officials from the ministry to examine Sharm El Sheikh and Hurghada airports, according to Ahram Online. This is the second visit of its kind since the Metrojet crash last fall. Russian President Vladimir Putin had said flights would only resume between the two countries when Russian officials can work with Egyptian authorities to check passengers and luggage.

German delegation offers help with borders, mediation with creditors: German Vice Chancellor and Economy Minister Sigmar Gabriel met with Egyptian President Abdel Fattah El Sisi yesterday, as part of a delegation of representatives from 100 German companies and financial institutions. On the agenda: Offering Germany’s help in boosting Egypt’s border security, Deutsche Welle reports. Gabriel also suggested that Germany could mediate between Egypt and its international creditors (which is welcome, of course, except we weren’t aware we needed mediation — yet). “We announced our willingness to cooperate,” Gabriel said after the meeting, but added that Germany did not make any concrete financial promises to Egypt. The two-day visit is expected to culminate in a number of economic agreements and MoUs. Gabriel told a press conference in Cairo that Egypt has “an impressive president” that is “worthy of admiration,” DNE reports.

WHAT WE’RE TRACKING THIS WEEK

Renaissance Capital’s inaugural Egypt Corporate Access Day begins on Wednesday in Cape Town and will connect South African investors to key decision makers from select high-profile companies in Egypt. The two-day event ends Thursday.

Also on Wednesday: Parliament will vote on the Ismail government’s agenda on Wednesday, said Speaker of the House Ali Abdel Aal, Al Masry Al Youm reports.

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SPEED ROUND
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Hollande presses on economic ties, human rights on day one of visit. France is looking to improve economic ties with Egypt and thinks business is one of the keys to a deeper relationship, French President François Hollande said yesterday at a joint press conference following a meeting with President Abdel Fattah El Sisi in Cairo. Hollande said Egypt has plenty to gain from the experience and technical know-how of French companies, especially in energy and transportation (citing Cairo’s third metro line project) and water infrastructure development. “We also want assure people seeking to visit Egypt that Egypt is safe,” said Hollande on the topic of tourism.

On the issue of defense, Hollande praised Egypt’s stabilizing role in the region and its fight against terrorism. He stated that France wants to provide Egypt with the means to defend itself against terrorism, alluding to a EUR 1 bn arms trade agreement.

Human rights, however, dominated the majority of the press conference. El Sisi stressed that the focus on the integrity of Egypt’s security forces and human rights record were an attempt by “evil forces” to weaken the country’s institutions, particularly the police and the judiciary, and destabilize the country from within. “The region we live in, President Hollande, is very turbulent.” El Sisi noted that “European criteria” for human rights shouldn’t apply to Egypt, France24 said. Hollande, the broadcaster noted, “said respecting human rights was not an obstacle to fighting jihadists, who have conducted large scale attacks in both France and Egypt.” While France is committed to helping improve Egypt’s human rights, it would not be the sole basis for bilateral relations, said Hollande. He added that human rights and fighting terrorism were two sides of the same coin.

You can watch the full press conference here (run time: 21:14).

The two sides signed 18 agreements and declarations of intent totalling EUR 1.8 bn yesterday; an expected EUR 1 bn in arms agreements are due to be signed today. Concrete agreements include:

• EUR 1.2 bn agreement to complete Cairo Metro’s third line, signed with the VINCI-led consortium that includes Bouygues Travaux Publics, Orascom and Arab Contractors;
• EUR 250 mn agreement to build an electrical substation, signed by the Electricity Transmission Company and the Alstom Grid-Rowad Modern Engineering Consortium;
• EUR 68 mn grant to connect homes with the natural gas grid, signed with the French Development Agency;
• EUR 80 mn loan to fund rehabilitation at the Ramses-Heliopolis tram line;
• Cooperation agreement for a EUR 40 mn solar power plant in South Sinai;
• EUR 50 mn credit facility to build a power transmission control center in the Delta.

Major declarations of intent signed include: a EUR 50 mn wind farm in the Gulf of Suez and a EUR 60 mn water treatment plant in Alexandria. Al Masry Al Youm has what it says is the full list of agreements signed.

The domestic press is continuing to report on potential new agreements expected to be signed with the top 40 or so French corporations that have joined Hollande’s delegation, according to Al Borsa, so we may expect more agreements post visit. (Check out Al-Borsa’s list of 42 of the companies participating in the trade delegation.) Among the expected agreements not yet reported:

• An MoU between Électricité de France and El Sewedy Electric;
• An MoU between the New and Renewable Energy Authority and the AFD-owned Proparco.

• An EUR 60 mn credit line extended to CIB by the AFD and a EUR 20 mn credit line to CIB via AFD subsidiary Proparco;
• An MoU between both countries to fund the Alexandria tram development;
• An MoU between the New Urban Communities Authority and MEDEF International for sustainable cities solutions;
• A cooperation agreement between Itron and El Maasera for Engineering Industries for power and gas smart grid networks;
• A cooperation agreement between Edison and the EGPC.

Could the arms sale be smaller than we had thought? France’s La tribune (French) says that while the EUR 600 mn Thales-Airbus agreement to sell Egypt military satellite communications gear is as good as done, “negotiations are still ongoing between [naval contractor] DCNS and Egypt” for the sale of two Gowind corvettes and two coastal patrol vessels in a transaction worth as much as EUR 55 mn.

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The Egyptian Financial Supervisory Authority (EFSA) passed new listing regulations that aim to protect the rights of minority shareholders, govern cross-ownership of related parties, restrict asset sales, and strengthen corporate governance guidelines, said EFSA head Sherif Samy. Under the new regulations, listed companies that have a parent company or a majority shareholder are not allowed to own more than 10% of a sister company controlled by the same corporate parent, said Samy. The new rules also stipulate that shares purchased by parent companies in their subsidiaries will be counted as treasury stock and subject to regulation as such. The regulations will also require management must seek the approval of a general assembly to sell more than 50% of a company’s non-liquid assets, Al Mal reports. Audit committees under must have a minimum of three non-executive board members and at least two independent members. Companies have until 30 June to comply with the new amendments.

The greenback was trading at EGP 10.44 yesterday on the black market compared to EGP 10.35 on Saturday, with traders pinning the rate on increased demand on imports due to the approach of Ramadan, Al Masry Al Youm reports. The CBE is set to host its regular auction tomorrow.

Juhayna reported a 1Q2016 net profit of EGP 80.4 mn compared to EGP 65.2 mn in the same period last year, according to a brief statement to the EGX. Revenues hit EGP 1.1 bn, a 27% surge year-on-year.

Egypt parting ways with one-time BFFs? China’s AVIC and China Harbour Engineering have officially protested the cancellation of MoUs signed to produce train cars and construct the Tenth of Ramadan-Salam City electric train line. Both MoUs were signed at the EEDC last year. AVIC’s agent in Egypt said the company bore the entire cost of the feasibility studies and will conduct the project on a PPP basis, which was a government demand. He added that the company was open to the idea of financing the project itself, but that meant a slight increase in the project’s cost for AVIC to be able to recuperate the investment cost. The companies are urging the cabinet to reconsider the partnership agreements, Al Mal reports.

Amid an ongoing backlash against the handover of Tiran and Sanafir to Saudi Arabia, Prime Minister Sherif Ismail held a press conference to reaffirm that the islands were Saudi’s in the first place. In fact, he said, a decree issued in 1990 outlining Egypt’s territory in Sinai acknowledged that fact. He said that 11 joint committees had been formed with the Saudis since 2008 and have continually affirmed the islands’ status as Saudi territory. Foreign Minister Sameh Shoukry joined the Ismail at the conference and noted that Egypt had not once raised its flag on the islands, Al Borsa reports.

Meanwhile, political parties opposed to the border treaty have launched a campaign called “Egypt is not for sale” and will collect petitions from across the nation and send lobby groups to pressure MPs to vote down the treaty and dissolve the Ismail cabinet, AMAY reports. The coalition will visit both islands and will take part in demonstrations planned on 25 April — the national holiday marking Sinai Liberation Day — to oppose the handover.

Taking advantage of the pressure, Sudan called on Egypt to have a sitdown to resolve the dispute over Halayeb and Shalatin once and for all. A statement by Sudan’s Foreign Ministry stated that Sudan may turn to international arbitration to settle the case if Egypt does not join in direct negotiations over the region, Youm7 reports. Egypt’s foreign ministry replied to the statement last night, stating that Halayeb and Shalatin are Egyptian and refusing to comment further on Sudan’s proposal, according to Al Masry Al Youm.

Proof there is no justice in the world: Egyptian companies win nods at MIT’s Startup Track, but lose to Kuwaiti karaoke… Yes, karaoke. Kuwait’s Ghinwa won first place in the Startup Track for an application for Arabic karaoke in this year’s MIT Enterprise Forum (MITEF) Startup Competition, Wamda reported. Other Startup Track winners included “Zamen from Egypt, an app offering daily breaking news coverage in Arabic from trusted news sources worldwide, and Saudi Arabian B8ak, which is an app that allows users to book handymen and service providers to maintain their houses.” Tutorama from Egypt and Morocco’s Deep OR and Ostor Lab were the winners of the Ideas Track.

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THE MACRO PICTURE

Emerging-market stocks are peeking their head outs from the rut, Bloomberg writes, as China’s economy is stabilizing, commodities rise, and the Fed signalled it would slow down on raising rates. “Short interest in the largest exchange-traded fund tracking developing-nation [USD]-denominated bonds has fallen to 2.2 percent of shares outstanding, near the lowest level since 2012, from 13 percent in mid-February,” according to data compiled by Bloomberg and Markit Ltd. “We’ve passed the low point,” Jens Nystedt, a New York-based emerging-market debt manager at Morgan Stanley Investment Management.

The looming Brexit isn’t looking good for the UK business environment, writes the FT (paywall). Uncertainty is having a “chilling” impact on business activity as companies rein in hiring and investment in several sectors. “[Brexit fears are] having a huge impact on general confidence” due to fear of the unknown, said Lord Mervyn Davies, chair of several private equity companies. The IMF has already warned (pdf) of the “severe” damage it would cause and Washington and Germany have also voiced concern. “In a survey of 370 European companies recently conducted by the European Business Awards, more than a fifth said that a potential UK exit from the EU was discouraging them from investing in the country.”

Don’t let the ‘inflation nutters’ get to you is the headline of at FT (paywall) piece penned by David Oakley, who asks if negative rates even matter to any of us who aren’t wealthy. BlackRock CEO Larry Fink had argued last week that negative rates hurt savers and pensioners, which Oakley says there is some truth to, but “Mr Fink’s remarks are also self-serving, as negative interest rates are bad for his business. It is the banks and rich people, whom asset managers largely serve, that negative interest rates hit hardest.” But more important it looks like negative rates aren’t going anywhere. “Policymakers, investors and consumers need to learn to live with them … the current levels are probably not a serious problem for most of us who don’t have [mns] … in our savings accounts,” writes Oakley.

EGYPT IN THE NEWS

Egypt is one of several countries getting on the bandwagon of marketing “diaspora bonds”, which Reuters says was successfully pioneered by India and Israel but “sometimes tricky to imitate.” Egypt’s USD and EUR debt certificates were an attempt to mitigate a hard currency shortage, but even CBE governor Tarek Amer admitted there’s been low appetite for them, attracting only USD 150 mn, he said during an interview with Lamees El Hadidy in March. But Egypt isn’t the only one underestimating the generosity of its expats. Greece was unable to raise USD 3 bn at the height of its debt crisis in 2011 and Ethiopia’s 2009 bond to fund a hydroelectric dam failed due to the same lack of appetite. “Many governments need to really look at themselves in the mirror, as to what has been their historic relationship with their diaspora and use that reality in their calculation when they offer investments,” said Liesl Riddle, a George Washington University professor. A diaspora as an investment can be beneficial because those with a “link to a country are often happier than other outsiders to take risks in the local currency, and at lower yields,” says Dilip Ratha, manager of the World Bank’s Migration and Remittances Unit, and “they can also be more willing stick around in a crisis than the big funds that dominate emerging market debt,” he added.

Egypt’s relinquishing of the Tiran and Sanafir islands, “ceded to it by Saudi Arabia in 1950,” has “exposed the Egyptian leadership’s narrative that the country remains a major regional power as a lie,” New America researcher Barak Barfi writes in Project Syndicate. The glib, quasi-intellectual piece traces the origins of Egypt’s problems to foreign debt and includes gems like how “the Soviet Navy had transformed the port of Alexandria into a virtual Soviet republic, with Russian spoken as a second language” during Nasser’s era. Barfi closes by saying “in a country where ancient artifacts are deeply cherished, the myth of regional greatness is one relic that should disappear soon.” Ah, amateur hour.

Bassem Youssef documentary has debut at Robert De Niro’s Tribeca Film Festival: A documentary titled Tickling Giants that followed the twists and turns of satirist Bassem Youssef had its world premiere in the Tribeca film festival in New York and is receiving coverage by Reuters. “You can do funny to be a distraction and you can do funny to affect people and this is the difference,” Youssef said about his shows.

Independent films trying to spark social dialogue in Upper Egypt: The Cinema Everywhere Initiative, launched in 2013, has screened about 40 films in locations across Upper Egypt, in locations that do not have any movie theatres. “However, it seems that the initiative’s ability to bring about change and consecrate independent art culture is still limited due to lack of funding and government support,” Reham Mokbel writes for Al-Monitor.

Egypt’s Hollowed-Out Society: An essay written by Egyptian lawyer Gamal Eid for the New York Times on the case levied against him and human rights advocate Hossam Bahgat.

Elsewhere in the Times, the US faces continued pressure from families for a reluctance to confront the UAE and Egypt over detained dual-citizen Americans in both countries for almost two years. The families of the accused have complained of a lack of attention by American officials, reports the New York Times. The US often advises families to not speak out because “private diplomacy is preferred,” said Human Rights Watch researcher Nicholas McGeehan, noting that this raises the concern of “whether these countries are prioritizing their citizens’ interest or their own strategic and business interests.” The issue also reiterates the fragile ties between the US and its Arab allies, including assuaging the UAE and its GCC counterparts follow the nuclear deal with Iran.

Israel-Turkey relations unlikely to thaw: Shoshana Bryen pens a piece for the Gatestone Institute about the touch-and-go relationship between Israel and Egypt, Turkey, and Russia, the main gist of which is all in the conclusion: “For Israel to trade its increasingly important relations with Russia, with Egypt — and thereby with Saudi Arabia — and with the Kurds for Turkish political approval and a promise to buy Israeli natural gas would seem to be a bad deal. For Israel to accompany that with the lifting of the Israel/Egypt embargo on Gaza that would empower Hamas — and thereby the Muslim Brotherhood, Iran and ISIS — would seem an enormous risk for no gain.”

WORTH READING

The best piece of economic thinking we’ve read in the past month is from the Guardian, where the lefty newspaper’s economics editor, Larry Elliott, argues that helicopter money — basically, the one-time transfer of cash into an economy to raise inflation and growth — is coming. Why? China’s recovery isn’t as durable as you think, oil prices remain “brittle,” real incomes in the U.S. continue to be squeezed — and the U.S. faces the prospect of a corporate debt crisis triggered by falling share prices. (Oh, and if helicopter money sounds like just another name for quantitative easing, Elliott notes the key differences: “The cash goes directly to firms and individuals rather than being channeled through banks, and there is no intention of the central bank ever getting it back.) Read: “The bad smell hovering over the global economy.”

DIPLOMACY + FOREIGN TRADE

Foreign Minister Sameh Shoukry stressed Egypt’s “maintained support for Palestine” in a meeting with Fadwa El Barghouthi, the wife of jailed Palestinian activist Marwan El Barghouthi. “Foreign Ministry Spokesman Ahmed Abu Zeid said the status of the Palestinian prisoners and detainees in Israeli prisons were discussed at the meeting,” SIS reported. The Foreign Affairs Ministry carried a statement in Arabic.

Immigration Minister Nabila Makram is visiting the US and Canada to “promote the purchase of USD [Belady] certificates by expats as a banking tool to support the national economy,” SIS reported. Makram will also ask expats to donate to the “Say Good Morning to Egypt” campaign, as well as meet with Egyptian scientists to discuss support for the Daba’a nuclear power plant.

A Chinese delegation is set to arrive in Egypt in May to discuss building a new textiles industrial city in Minya with the Readymade Clothes Export Council, said the Council’s head Mohamed Qassim. He adds that this would be the first business delegation since the one that accompanied Xi Jinping last January, Al Mal reports.

ENERGY

International oil company receivables up USD 200 mn in March- Oil Ministry
Egypt’s total debt to international oil companies ticked up by USD 200 mn in the last quarter to USD 3.2 bn in March, sources from the Oil Ministry told Amwal Al Ghad. The ministry had managed to maintain the debt at under USD 3 bn until the end of 2015 by paying monthly instalments of up to USD 500 mn, the source added. The ministry is in talks with the CBE, the Finance Ministry, and other state institutions to arrange financing for the debt to encourage further investments, Oil Minister Tarek El Molla said. (Read in Arabic)

Fuel flow to governorates up 15% in time for harvest season- Oil Ministry
The Oil Ministry is increasing fuel flow to governorates by 15% ahead of the harvest season, which runs until May, said EGPC Chairman Tarek El Hadidi. The ministry currently pumps roughly 40,000 tonnes of diesel and c. 22,000 tonnes of gasoline into the market each day, he added, but is adding 15% in anticipation of a spike in demand. (Read in Arabic)

BASIC MATERIALS + COMMODITIES

Montenegro offers four ships to transport grain to Egypt
Montenegro has offered up the use of four of its shipping vessels to transport grain to Egypt, Amr Moselhy, a member of the Alexandria Chamber of Commerce, said. Montenegro’s nonresident ambassador to Egypt noted the possibility of using Montenegrin vessels to transport commodities from nearby countries to the Port of Bar, then to Egypt. (Read in Arabic)

MANUFACTURING

Ceramica Cleopatra targets doubling exports to Saudi Arabia
Ceramica Cleopatra is planning to double its exports to Saudi Arabia, according to comments made by Chairman Mohamed Abou El Enein. He said the company is now working on how to make the best use of the facilities provided by Saudi Arabia to Egyptian producers. Abou El Enein also called on the Egyptian government to reduce the price of natural gas to ceramics producers, as it did for steel manufacturers. (Read in Arabic)

Centamin to begin mandatory profit sharing at Sukari concession
The Egyptian Mineral Resources Authority (EMRA) has completed reviewing Centamin’s expenditure and revenue report for the Sukari mine and will implement a mandated profit-sharing agreement by late-June, Daily News Egypt reports. Centamin will recover all investment expenses in the Sukari mine, said EMRA chairman Omar Teama. Pharaonic Gold Mines Company, a subsidiary of Centamin, planned to start profit-sharing with the Egyptian government in 2017, according to CEO Yousef Al-Raghi. (Read)

HEALTH + EDUCATION

Futures British School placed under gov’t financial, administrative control
Futures British School has been placed under the Education Ministry’s administrative and financial control, a source told Al Masry Al Youm. The school is the subject of an investigation involving the alleged [redacted] assault of students by a member of its security personnel. The source said the school will be under the ministry’s control until the issues are resolved. The cases are currently being investigated and a suspect is under arrest. (Read in Arabic)

REAL ESTATE + HOUSING

Engineering Authority to tender Hadabat Al Galala projects soon
The Engineering Authority of the Armed Forces will tender projects as part of the Ain Sokhna Hadabat Al Galala development soon, said the authority’s head Gen. Kamal Al Wazeer. He reiterated that the Engineering Authority will be the sole body responsible for issuing tenders for a 1,000 feddan development, which will include constructing a yacht marina, a beachside resort, two hotels, and a water park. Al Wazeer also ordered the construction of a EGP 40 mn marble plant in the area to help the development. (Read in Arabic)

TOURISM

Egyptian Businessmen’s Association calls for tasking international companies with running tourism city airports
The tourism committee at the Egyptian Businessmen’s Association is calling on the government to task international companies with running Egyptian airports in tourist cities within a month, Al Borsa reports. Converting the Ras Banas military airport to a civilian airport in the next six months will help bring back investments to the Red Sea area, said tourism committee head Ahmed Balbaa. (Read in Arabic)

TELECOMS + ICT

Orange Egypt to develop network infrastructure, float shares; will pay 1% royalty to parent company
Orange Egypt’s priority in the upcoming period is refurbish its network infrastructure to accommodate its customers’ demands, Chairman Atef Helmy said. The company aims to issue new products soon that showcase the transition from “a local operator to an international one.” Helmy also added that Orange Egypt will float an unspecified number of shares on the EGX, according to Al Mal. Meanwhile, Orange’s Egyptian subsidiary will continue paying its parent company 1% of its annual revenues as a royalty for use of the Orange trademark, Al Borsa reports. The agreement, which was ratified by Orange Egypt’s general assembly, will take effect this year and will be up for renegotiation in 2018, said company sources.

AUTOMOTIVE + TRANSPORTATION

GM injects EGP 110 mn in Egypt to assemble Chevy Optras
General Motors (GM) is going to assemble Chevrolet Optra cars in Egypt with an investment of EGP 110 mn, Al Mal reports. The Egyptian operations will be under strict supervision and will abide by international operational standards, GM’s domestic sales manager noted. Also speaking at the launch event yesterday was GM Egypt’s managing director Tarek Atta who stated that the company’s plan to export from Egypt to the African and Saudi Arabian markets hinges on the adoption of the automotive directive, the newspaper adds.

Auto industry to hold meeting with Organization for Standardization over upcoming July standards
Auto industry representatives will meet with the Trade Ministry’s Organization for Standardization and Quality (EOSQ) on Thursday to discuss the new standards it plans to impose on the industry, said head of quality control at General Motors Egypt Ayman Badr during a press conference for the launch of Chevrolet Optra in Egypt. As we noted back in February, the EOSQ plans to set some 42 new standards for both imported and locally assembled cars, which will be phased in over three years beginning in July 2016, according to statements by the authority’s chairman Hassan Abdel Meguid.

Egyptian Automotive CEO talks regional expansions, internal conflicts
The Egyptian Automotive and Trading Company, Volkswagen’s licensed distributor in Egypt, has been holding talks to acquire Volkswagen’s distributors in Libya, and Audi’s official distributor in Sudan, said Egyptian Automotive’s CEO Karim Naggar. Egyptian Automotive is also holding talks to form a partnership with Volkswagen’s Ghana distributor, Naggar tells Al Mal. He did admit that the Libya talks have stalled as a result of the turmoil in the country. Naggar also spoke about the internal conflicts within the company instigated by an unnamed Lebanese majority shareholder (who owns 40% of Egyptian Automotive). This shareholder has been using “minor violations” to try and oust Naggar to shift the strategic direction of the company, he said. (Read in Arabic)

BANKING + FINANCE

EFG Hermes Leasing to double market share in 2016, looks to capital increase in 2017
EFG Hermes Leasing plans on doubling its market share and is looking extend lease financing on assets worth c. EGP 1-1.5 bn in 2016, its CEO Ahmed El Kholy said during a conference on financial leasing on Sunday, Mubasher reports. The wholly owned subsidiary of EFG Hermes is in talks with eight local banks to provide portfolio financing of EGP 900 mn compared to EGP 800 bn received from five banks in 2015, he added. El Kholy also pointed to possible joint financing agreements worth EGP 650 mn with national financial leasing companies, adding that this would coincide with a targeted capital increase to EGP 125 mn from EGP 100 mn in 2017. EFG Hermes Leasing launched in May 2015 and was the ranked the fourth-largest player in the industry on the March league table. Al Borsa has coverage in Arabic.

Leasing contracts fall 36.5% in February
Leasing contracts in Egypt fell 36.5% year on year in February to EGP 2.2 bn, down from EGP 3.8 bn in February 2015, read an EFSA report published in Al Mal. CIB subsidiary Corplease held the industry’s top position scoring EGP 854 mn contracts in February and capturing a 24% market share, followed by Arab African International Leasing with a 19% market share, Global Lease with 18% and EFG Hermes leasing with 12%, according to Al Mal.

Banks to reprioritize financing after Housing Ministry issues 500k low-income units
The Housing Ministry’s issuance of 500k low-income units at the end of the month is expected to cause a boom in real estate financing over the next few years, Al Borsa reports. While the announcement carries a positive impact for the banking industry, the high demand requires further assistance from the CBE, bankers told Al Borsa. A CBE official said the bank is ready to grow the EGP 20 bn financial portfolio it allocated toward real estate financing after both phases worth EGP 10 bn are completed. (Read in Arabic)

AXA signs EGP 20 bn reinsurance agreement for Suez Canal tunnels; to rebrand, double capital of CIL
AXA has signed a EGP 20 bn reinsurance agreement for the Suez Canal tunnels, Al Borsa reports. AXA also plans to double the capital of its subsidiary Commercial Life Insurance (CIL) to EGP 180 mn before 1H2016 is out as part of a EGP 500 mn expansion plan over the coming three years, said AXA’s CEO Hassan El Shabrawishi. He added that the company plans to rebrand CIL, which it acquired from CIB, with the AXA stamp. (Read in Arabic)

Banking market does not need another credit bureau- deputy CBE governor
The banking market does not need another other credit bureau right now, said CBE deputy governor Gamal Negm in response to a lawsuit filed by by Egyptian and US investors appealing the CBE’s refusal to allow them to establish a credit bureau under the name EgyScore, DNE reports. The lawsuit, levelled against the prime minister, the investment minister, and the CBE governor, states that allowing only one company, I-Score, to practice constitutes a monopoly, which violates market rules. The CBE granted I-Score a license in 2008, and the company has 25 banks associated with it along with the Social Fund for Development. (Read)

OTHER BUSINESS NEWS OF NOTE

Half International to recycle waste for LafargeHolcim for USD 175 mn
Egyptian waste management and recycling firm Half International signed a USD 175 mn agreement with LafargeHolcim to import and recycle 50,000 tons of solid waste per year. Half International will recycle 3,000 tons of waste per month from LafargeHolcim until the contract expires in September 2017 through its three main recycling centers in Egypt. (Read in Arabic)

LEGISLATION + POLICY

New draft Journalism and Media Act could be done in the next few days
The Journalism Syndicate has apparently formed a committee that has been in talks with the government over the past week to fine tune and finalize the draft Journalism and Media Act, which has been long dormant since its announcement back in August. Syndicate number two Khalid El Balshy stated that he expects the draft will be finalized in the next few days, adding that the 230-article legislation aims to unshackle media from censorship but also promote self-restraint. Previous drafts of the legislation have sought to form an overall media governing body, restrict foreign ownership of outlets, and set new licensing rules for the industry.

NATIONAL SECURITY

UAE, Egypt continue joint naval exercise in Arabian Gulf -report
Warships from the United Arab Emirates and Egypt drilled in waters off the UAE, Egypt’s military spokesman said yesterday, saying the Khalifa II military and naval exercises will continue “for several days.” The exercises involve scenarios “handling enemy targets at sea, storming suspect vessels, ship combat, [all] while coordinating with air forces to receive air support.” Ahram Online reported.

ON YOUR WAY OUT

Egyptian Disney fans are calling on the company to return to dubbing its films in the Egyptian dialect, instead of having them dubbed in modern standard Arabic. Ahram Online says the campaign isn’t the first of its kind, referencing one from 2014, to which Disney responded by saying it was targeting the entire Arab world, not just Egypt. This claim is not entirely valid, a Brown University professor had said, as he said Disney commissioned “separate translations of its films for speakers of Castilian Spanish and Latin American Spanish, European Portuguese and Brazilian Portuguese, European French and Canadian French, but is moving in the opposite direction when it comes to Arabic … The markets are there. What is missing is a constituency for cultural production in dialectal Arabic.”

Egypt’s Court of Cassation overturned the three-year jail sentences for 17 Al-Azhar students convicted of rioting in December 2013, Ahram Online reports.

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CALENDAR

17-18 April 2016 (Sunday-Monday): German economic delegation visits Cairo.

18 April 2016 (Monday): French President François Hollande visits Cairo.

20-21 April 2016 (Wednesday-Thursday): Renaissance Capital’s inaugural Egypt Corporate Access Day, Cape Town, South Africa

31 March-22 April (Thursday-Friday): The Downtown Contemporary Arts Festival (D-CAF), various locations, Cairo.

23 April 2016 (Saturday): TECHPULSE 1.0 conference by Youthpire, Nile University, Egypt. You can register for the conference here.

25 April 2016 (Monday): Sinai Liberation Day (national holiday)

26-28 April (Tuesday-Thursday): Arabian Hotel Investment Conference, The Madinat Jumeirah, Dubai.

01 May (Sunday): Easter Holiday / Labour Day (national holiday)

02 May (Monday): Sham El Nessim (national holiday)

02-03 May (Monday-Tuesday): The Middle East Investment Summit 2016, Ritz-Carlton DIFC, Dubai.

10 May (Tuesday): Business News Foundation’s Third Annual Energy Conference: Energy and Sustainable Development, InterContinental Hotel Citystars Cairo. Register here.

16-17 May (Monday-Tuesday): Egyptian-Bahraini committee meets, Cairo.

25-26 May (Wednesday-Thursday): The Middle East and North Africa Solar Conference and Expo MENASOL 2016, Hyatt Regency, Dubai.

02-03 June (Thursday-Friday): The first annual EBRD Research Symposium on The Economics of the Middle East and North Africa, EBRD headquarters, London, UK.

06 October (Thursday): Armed Forces Day (national holiday)

27 November 2016 (Sunday): 2016 Cairo ICT Conference Group

04-06 December 2016 (Sunday-Tuesday): Solar-Tec exhibition, Cairo International Convention Centre, Cairo