Monday, 13 June 2016

CPA orders four Ramadan ads off the airwaves

TL;DR

What We’re Tracking Today

Following yesterday’s move to pull Juhayna’s “dondoo” ad, the Committee for the Promotion of Virtue and Prevention of Vice Consumer Protection Agency (CPA) has ordered Ahram Beverages’ Birell, Cottonil, and Dice to pull ads the agency claims “violate community traditions and public tastes,” Al Masry Al Youm reports. Hala Mahran, CEO of Nile Productions AD, which produced the Cottonil ad, is adamant that the company will not pull the spots. The CPA says the companies must comply or face sanctions, Al Mal reports.

What have the offending ads allegedly done? According to the CPA:

  • Juhayna (watch): [Redacted] innuendo related to milk produced by human mammary glands; “promotion of unhealthy eating and drinking habits to children.”
  • Birell (watch or watch): [Redacted] innuendo from the use of a flip-flopping logo and one character examining another’s netherparts in a public restroom.
  • Cottonil (watch): [Redacted] innuendo in a scene showing women exercising; promoting unsafe behavior by showing a family of five on Vespa.
  • Dice (watch or watch): Again with the [redacted] innuendo and a closing shot showing a woman’s torso in briefs.

Meanwhile, the House of Representatives was recently overtaken by a fit of reasonable-ness: The House committee on legislative and constitutional affairs has discussed abolishing articles that criminalize contempt of religion. Two representatives, including Al Azhar professor Amena Nosseir, have submitted bills that would amend the criminal code to abolish the offense entirely, Al Mal reported. Nosseir said the “contempt of religion” articles had been used to stifle freedom of expression, which she characterized as being enshrined in Islam.

When do we eat? Iftar will be at 6:58pm CLT today, while the cut-off for sohour will be at 3:08am CLT, according to Islamic Finder.

Iftar today also happens to coincide with Apple’s 2016 Worldwide Developers Conference. What can we expect out of the event? Tweaks to iOS 10, with the possibility of a dark mode circulating based on the look of Apple’s WWDC app and site. Siri may also be getting a revamp, allowing it to access data and perform tasks in apps — and possibly moving to OS X, which may be rebranded MacOS (which oldtimers will remember was its original name, anyway). Also look for a redesigned Music app and possibly iMessage for Android. Following the FBI debacle rumors have suggested Apple is working on implementing stronger security measures “even it can’t hack” to protect iOS devices. Some of us aren’t holding our breath, but a leak this past weekend leaves open the door that a revamped MacBook Pro (thinner and with a touch-sensitive OLED strip instead of function keys) could be in the works.

How do I watch? If you own an Apple TV, you can stream the whole event by when Apple makes the “WWDC Live” app available. Tap hereto watch live on a desktop or your phone.

Back on planet Egypt: Expect the mercury to rise once again on Monday after a few days of what Ahram Online describes as “mild” weather (we put it just a few notches below “melting our faces off”). Temps are expected to reach a high of 39C in Cairo and 33C in Alexandria. Our iPhone weather app puts Tuesdays high at 41C and Wednesday at 40C before dropping down to 36C on Thursday.

What We’re Tracking This Week

The local wheat buying season will end on Wednesday as the government has already surpassed its set target of buying 4 mn tonnes. "Supplies Minister Khaled Hanafi pointed out that the door for receiving local wheat from farmers will close at the end of Wednesday due to lowering local procurement rates," Reuters quoted a Supply Ministry statement as saying.

Interest rate watch: The U.S. Federal Open Market Committee meets to discuss interest rates this coming Tuesday and Wednesday (14-15 June), with the Central Bank of Egypt’s Monetary Policy Committee due to do the same on Thursday. EFG Hermes’ Mohamed Abu Basha has come down on the side of a rate hike, predicting yesterday that the MPC would raise rates 25 bps, writing: “We see May’s sharp inflation acceleration – especially that of core inflation – warrants a move by the central bank. We therefore expect a 25bps rate hike on 16 June meeting, frontloading part of the 50-100bps hike we expect in 2H16 associated with the implementation of VAT.” Picking up where we left off yesterday, that leaves us so far with two analysts predicting a rate hike and one expecting none.

On The Horizon

The next session in the trial of former Central Auditing Organization chief Hisham Genena is due to take place on Tuesday, 21 June, and next week is Brexit week as the U.K. heads to the polls to vote on whether to remain in the European Union on Thursday, 23 June.

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Speed Round

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Egypt to restart loan talks with the IMF — again? The Ismail government is reportedly considering restarting preliminary loan talks with the IMF, sources told Al Masry Al Youm. The amount of funding required has not been determined yet, but it is expected to be different from the USD 4.8 bn Egypt was in talks over most recently. The government has not yet informed the IMF of its intentions, the sources explain, as it is trying to build domestic political support first.

And while we’re on funding, the House Economics Committee unanimously approved a USD 1.5 bn loan agreement with Saudi Arabia to develop Sinai, according to an emailed government statement. USD 500 mn will be used to develop the King Salman University in Al Tor City, funding a series of agricultural and irrigation projects, and upgrading North Sinai’s network of roads. The remaining USD 1 bn will be allocated towards buying Saudi oil products for “development purposes.” Earlier this month, the House of Representatives overwhelmingly approved the Legislative and Constitutional Committee’s report in favor of the loan, before being referred to the Economics Committee. Both committees will then prepare a report, which will be reviewed, discussed, and voted on by parliament, Ahram Online reports.

EFG Hermes will distribute c. USD 122 mn in proceeds from its USD 310 mn sale of Credit Libanais to its shareholders in the form of cash and share buybacks. The company outlined its roadmap following the sale in a statement yesterday, which sets out its vision for use of the remaining proceeds as it adds firepower to its existing operations and expands into frontier markets and new product lines. Perhaps most intriguingly, the firm is looking to move to a merchant banking model, writing: “We will start to pursue underwriting activities for both debt and equity as well as selectively taking pre-IPO positions in companies that are in need of capital to finance their final phase of growth before going public.”

EFG Hermes also said it will also “fortify its operating subsidiaries” and enhance the capitalisation of its investment banking platform. A main objective for the company is to grow its assets under management through public and private markets by way of its asset management and private equity teams. EFG Hermes is looking to transform itself into a “frontier house,” with a strong presence in the MENA region as it eyes expansion in Pakistan, Morocco, Vietnam, Bangladesh, Sri Lanka, and Kenya. It is also looking to expand its finance platform, which includes microfinance arm Tanmeyah and its leasing business. Reuters has coverage, or you can read the full statement for yourself here in pdf.

Renaissance Capital (Rencap) considers setting up an investment banking business in Egypt, but the picture will be clearer by the end of 2016, the company’s MENA executive director Ahmed Badr told Daily News Egypt (the article was down at dispatch time this morning). Badr left open the possibility of entering via acquisition or a greenfield setup, saying Rencap has seven transactions in its pipeline for execution in Egypt, including both M&As and IPOs, noting that, “the public offerings managed … are expected to be implemented a year from now.” Badr also added that Rencap is in discussions to manage an international bond offering for Qalaa Holdings, a transaction that was scrapped last year as “market conditions were not optimal at the time.”

French car manufacturer Peugeot Citroen is looking to build a car manufacturing plant in Egypt that will see it hike its use of domestic components and supply regional markets, particularly in Africa, said Industry and Trade Minister Tarek Kabil. The decision to increase its investments in Egypt is contingent on the incentives and benefits laid out in the automotive directive, the company’s VP said in a statement. The French firm is also looking to contract Egyptian companies to build components for its assembly plants worldwide, AMAY reports.

Naguib sues Canada: Global Telecom Holding (GTH) announced (pdf) it filed a formal arbitration request against the government of Canada “in respect of actions taken by the Canadian Government against GTH and its subsidiaries in relation to GTH’s investment in Wind Mobile.” GTH says the Canadian government’s “actions” caused “loss to GTH including the sale of its interest in Wind Mobile in September 2014 at a significantly distressed price.” And while you’re on the GTH site, check out the epic bio of founder Naguib Sawiris.

Talk of another cabinet shuffle is in the air: It’s that time of the year, folks. Roughly three months since the swearing in of a new cabinet, there is already talk of another shuffle. Disappointing results from certain ministries, including one from the economic group, has allegedly prompted a decision to replace ministers, senior government sources tell Al Masry Al Youm in what is so far entirely uncorroborated chatter. The “disappointment” reportedly comes from the presidency itself, which met with a number of ministers before Ramadan to discuss their shortcomings. The move will supposedly take place following the Eid break. On the chopping block: the education Minister, likely because of the recent cheating scandal; irrigation, which recently announced that Egypt is in the midst of severe drought; and health, possibly over the ministry’s handling of a shortage of compounds used to treat medical conditions. The presidency was also not impressed with the continued blackouts in certain parts of the country and water shortages during Ramadan. We believe that a story speculating about a possible post-Eid cabinet shuffle is constitutionally mandated every year during the first two weeks of Ramadan.

The House of Representative has confirmed the appointment of former prosecutor Hisham Badawi as the chief of the Central Auditing Organization, succeeding Hisham Genena, who is currently being charged with “misleading the public.” 329 of 596 MPs voted in Badawi’s favour.

Negotiations between the planning and budget committee and the Finance Ministry are underway to increase earmarks for the education and health sectors in the 2016-17 budget to the constitutionally mandated 10% of GDP, sources told Al Borsa. In the new budget, the health sector is allocated EGP 60 bn, including EGP 49.5 mn for the Health Ministry and EGP 9.9 bn for university hospitals that are technically under the Higher Education Ministry, the source added. Finance Ministry officials have previously raised very on-point concerns as to whether the health or education sectors presently have the capacity to deploy the fully constitutionally mandated amounts and are instead looking to phase-in the funding hikes.

It’s baaack: A court has overturned a March decision by Egypt’s Media Free Zone to ban Al Faraeen TV Channel from the airwaves for a year, Ahram Online reported on Sunday. The authority suspended the channel, which is owned by infamous former MP and TV host Tawfiq Okasha, after receiving complaints that the channel “had violated the law and principles of operation in the media zone.” Okasha still appears to be banned from appearing on TV, however, but the decision can still be appealed. Members of parliament orchestrated Okasha’s exit from the House after he had the Israeli ambassador to Egypt over for dinner.

**Related: Obligatory clip of Mahmoud Azab portraying Tawfiq Okasha: (Watch in Arabic, running time: 5 minutes)

Egyptian investigators said yesterday that the black boxes of EgyptAir flight 804 have only around five days of battery power left before they stop emitting signals that are allowing searchers to triangulate on them, the Associated Press reports.

In what is being called the worst mass shooting in US history, a gunman who reportedly pledged allegiance to Daesh killed 50 people and injured 53 others on Sunday at a nightclub in Orlando, Florida, Reuters reports. The shooter, who has been identified as Omar S. Mateen, an American citizen whose parents were from Afghanistan, “called 911 and talked about the Islamic State shortly before the massacre at the Pulse nightclub,” according to the New York Times. Daesh claimed responsibility hours after the attack, claiming it “was carried out by an Islamic State fighter,” according to a transcript provided by the SITE Intelligence Group. Mateen’s ex-wife has come forward calling the 29-year-old man “unstable” and abusive but that he showed no signs of any radical leanings during their months-long marriage that ended eight years ago.

Closer to home: A bomb exploded outside the headquarters of Lebanese Blom Bank in central Beirut on Sunday, causing damage but no fatalities, according to Reuters, which is framing this as part of a banking crisis in the country following a US decision to have banks target the finances of Hezbollah.

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Egypt in the News

Egypt is the world’s fourth-biggest weapons importer, spending almost USD 2.3 bn in the past year, the consulting company IHS Inc. said in its Global Defence Trade Report published Sunday. “Before 2013, the country spent [USD 1 bn] or less annually, but ‘there’s been this ramp-up,’” according to Ben Moores, a senior defense analyst at IHS Aerospace, Defence & Security. “IHS research indicates the higher spending is being underwritten by Egyptian allies France and Gulf Arab states,” Bloomberg reports.

Small victories: Egyptian-made Ramadan lanterns are reportedly gaining on their Chinese counterparts this year, according to Gulf News. Tin, wood, and khaymiyya cloth draped lanterns “re-established a foothold at the Egyptian market, years after they were outrivalled [sic] by lanterns made in China.” Last year, Egypt banned imports of foreign lanterns to protect the local industry and preserve the traditional handicraft of lantern making.

Worth Reading

To Understand Clinton’s Moment, Consider That It Came 32 Years After Ferraro’swrites the New York Times in a piece comparing Geraldine A. Ferraro, the first woman to be tapped by a major party to run for vice president in 1984. “There were the strange male missteps: the mayor of Los Angeles saying he wanted ‘a vice president I can hug,’ the Mississippi official who called Ms. Ferraro ‘young lady’ and asked whether she could bake a blueberry muffin. The grim drumbeat about her husband’s finances, his real estate dealings and his tax returns. There was the constant watch for weakness — would the woman cry?

Worth Watching

A group of Egyptian companies from a range of industries is funding an awareness campaign launching a “proudly made in Egypt” quality seal issued by the Trade and Industry Ministry. The long-term campaign encourages Egyptian consumers to “buy Egyptian” by poking fun at our national love-hate relationship with all things foreign. The campaign, created by TNA, debuted during Ramadan and actively encourages consumers to play a role in Egypt’s economic recovery with the choices they make in stores every day.

Watch the first three installments here, here and here.

The Macro Picture

The energy downturn has shown oil majors the virtues of “vertically integrated” oil groups, according to the Financial Times (paywall), which combine the “upstream activities” such as finding and developing oilfields with “downstream functions” like refining crude and selling petroleum products. The model not only creates a hedge against a drop in the price of crude, but also “captures the highest value for every molecule that flows through” facilities, according to Rex Tillerson, chief executive of ExxonMobil.

Meanwhile, the FT’s (paywall) Ed Crooks tells us that the drumbeats of US shale are softly sounding as the industry evolves in survival of the fittest. “The best of the shale companies, however, now look like evolutionary winners for the long term. It is the big oil companies and their mega-projects that increasingly look like the dinosaurs.

The IMF is sounding the alarm on China’s corporate debt, joining a host of other voices calling out the nation on its debt-riddled economy, according to the FT (paywall). “We have learned over and over in the past 20 years how disruptions in one country’s economy and markets can reverberate worldwide,” said David Lipton, the IMF’s number two and the leader of its latest mission, which ends on Tuesday. Lipton also cited the global “spillovers” from last year’s turmoil in Chinese markets.

Diplomacy + Foreign Trade

Portuguese Foreign Minister Augusto Santos Silva is heading a delegation on a two-day visit to Cairo that began Sunday for trade and political talks, according to Ahram Online. Silva is slated to meet his Egyptian counterpart Sameh Shoukry. “An Egyptian-Portuguese trade committee is set to meet in Cairo in the second half of 2016,” the newspaper added.

The drafting of a model of a unified Arab-world customs law has been finalised, Magdy Abdel Aziz, the head of the Egyptian Customs Authority said, adding that countries involved are currently following up on a procedural manual to accompany the law, Al Borsa reported on Sunday. Egypt is expected to submit a working paper that provides mechanisms to tighten control over the movement of trade across borders, specifies the roles of customs authorities within the framework of the World Customs Organisation, as well as suggests ways to strengthen coordination with all related bodies. (Yeah, we’re not holding our breath either.)

Energy

Thirteen banks will arrange EGP 5 bn loan for Petrotrade

A consortium of 13 banks will arrange a EGP 5 bn loan for the Petroleum Trading Services Company that will be used to pay debts to the Egyptian General Petroleum Company (EGPC), sources told Al Mal. The consortium includes NBE, the Arab African International Bank, and CIB, who are arranging 50% of the loan, among others, the source added. The final loan agreement will be signed by next week, with the loan being paid back over five years, the source said.

GE, Orascom Construction complete civil engineering works on Assiut power plant

General Electric and Orascom Construction have completed civil engineering works on the USD 420 mn project to convert the Assiut power plant to a combined-cycle plant, said Ibrahim El Shahat, head of the Upper Egypt Electricity Production Company. the companies will install eight steam boilers producing 500 MW each as part of the turnkey project, Al Mal reports.

Weak transmission infrastructure behind spate of power cuts in Upper Egypt

Crumbling infrastructure at electrical substations were behind the latest spate of power cuts affecting parts of Upper Egypt and the Red Sea governorate throughout Ramadan, Al Mal reports, citing remarks by Deputy Electricity Minister Gaber Dessouky. These problems will be addressed as part of an EGP 16 bn plan to revamp Egypt’s transmission network, said Dessouky.

Merlon International ups investments in Fayoum concession to USD 100 mn

Merlon International has allocated USD 100 mn towards its Fayum concession through its JV Petrosilah for FY2016-17, Al Mal reported. The USD 15 mn increase from last year is to cover rising costs and expenditures, said Petrosilah Chairman Taher Abdel Rehim. The company is planning three exploratory wells in November at a cost of USD 3-5 mn each, he added, noting the company will increase its production from 10.5k bbl/d to 11k bbl/d of crude within days, he said.

Shell, Apache will complete production tests at Apollonia field in June

Royal Dutch Shell and Apache are set to complete initial natural gas production tests from limestone layers in the Apollonia field by the end of June, sources tell Daily News Egypt. The two companies plan to drill 30 wells in the Western Desert after the tests are completed, he added. As we had previously reported, Shell and Apache have agreed to price the natural gas at USD 4.6 per mmBtu.

Infrastructure

Societe Egyptienne d’Entreprises developing 500 feddans in New Alamein

Societe Egyptienne d’Entreprises is completing infrastructure work over an area of 500 feddans in New Alamein at a total cost of EGP 400 mn, Vice Chairman Mohamed El Khatib told Amwal Al Ghad. The 500 feddans represent the first phase of the 2,000 feddan New Alamein project, in which the Arab Contractors are also participating, he added. The company aims to complete the infrastructure network within a year and a half, said El Khatib.

Arab Organisation for Industrialization to deliver Dabaa sewage plant on Sunday

The Arab Organisation for Industrialization is set to deliver an EGP 450 mn sewage plant in Dabaa next week, an official at the organization told Al Borsa on Sunday. It also signed a protocol on cooperation with the governorate of Fayoum to build an EGP 100 mn sewage treatment plant with a daily capacity of 400 cubic metres, in collaboration with the Local Development Ministry and an agreement with the General Authority for Educational Buildings to provide 10 schools in the Gharbia governorate before the start of the new academic year.

Manufacturing

Electrostar begins building EGP 70 mn refrigerator factory

Electrostar has begun building a new EGP 70 mn refrigerator factory that is set to begin production in March 2017, Managing Director Khaled El Menoufy told Al Shorouk. The company aims to boost its refrigerator exports while maintaining its market share in the domestic market, he added. Electrostar is looking to boost sales to EGP 500 mn this year, up 10% from last year, said El Menoufy.

Raya Trade to assemble smart TVs in Egypt in 3Q2016

Appliance distributor Raya Trade plans to begin assembling smart television sets in Egypt with an unnamed partner in 3Q2016, said Raya CEO Bassem Megahed. The company hopes to produce 50,000-60,000 TVs per year with components sourced from China, Megahed tells Al Mal without stating the size of the investment. The move would put the company in competition with Samsung and LG, which both assemble TVs in Egypt.

Health + Education

Eva Pharma resumes manufacturing and distributing meds

Eva Pharma has resumed manufacturing and distributing 10 products in short supply in Egypt and priced under EGP 30, Al Borsa reports. Health Minister Ahmed Rady had stated last month that around one third of all medications in Egypt were in short supply as a result of manufacturers pulling the plug. This prompted the cabinet to approve a 20% increase in products under EGP 30, but capped the increase at EGP 6. Companies that fail to produce any one compound within three months of the price hike being authorized will have their licenses revoked, said Rady.

Real Estate + Housing

Palm Hills contracts AS&P to conduct feasibility study on Wahet October project

Palm Hills Developments has contracted German consultants AS&P to conduct feasibility studies on the 6,000 feddan Wahet October project in Sixth of October, Al Shorouk reported. AS&P will study the investment cost of the project along with the project’s master plan in conjunction with ongoing negotiations between Palm Hills Developments and the New Urban Communities Authority and the UAE’s Aabar Investments. The two companies signed an MoU with the Housing Ministry at the EEDC conference in March 2015 to build a housing project over 10,000 feddans, but the area was later reduced to 6,000 feddans.

Tourism

Saudi Arabia approves daily flights between Riyadh and Sharm El Sheikh

Saudi Arabia has approved having daily flights between Riyadh and Sharm El Sheikh for three months after Ramadan, said the deputy head of the Tourism Development Authority Ahmed Hamdy. He added that the ministry has reached an agreement with tourist resorts and hotels to provide offers and special pricing for GCC tourists. He also stated that JWT had launched its promotional campaign targeting the GCC and Jordan earlier this week, Al Mal reports.

Telecoms + ICT

NTRA to offer highest bidder right to temporarily be the sole 4G provider

The National Telecommunications Regulatory Authority (NTRA) is considering allowing the highest bidder for the 4G licences the exclusive right to offer 4G services before competitors. Al Borsa says NTRA is considering allowing the highest bidder up to three months where it would be the sole 4G provider, with a source noting that the value of the licences will not be the same for the four potential bidders.

Automotive + Transportation

Kuwait investor Nawal Al Sabah will invest USD 50 mn in land transport

Kuwaiti investor and World Fund for Development and Planning Ambassador Nawal Al Sabah has declared her intent to invest USD 50 mn into Egypt’s land transportation sector, Al Mal reported. Al Sabah said she has contracted a major transportation company to import 100 buses and microbuses as well as 70 locomotives after the Eid Al Fitr holidays, noting that a number of them will be donated to the public transportation sector.

Arab Contractors-Orascom Construction consortium will complete Phase 4B of Third Metro line within two years

The Arab Contractors-Orascom Construction consortium is set to complete construction work on Phase 4B of the Third Metro line within two years, Arab Contractors Chairman Mohsen Salah told Amwal Al Ghad. The original project duration was six years, he added. The construction includes the stations, electromechanic works, a central control room, and railroad lines, he said. Phase 48B is 6.1 km long and extends from the Nozha 2 station to the Adly Mansour station “across a viaduct and five elevated stations,” OC said in a statement last week. OC’s share of the contract under the 50-50 joint venture will amount to c. EUR 295 mn.

Transportation Ministry to reintroduce plan to raise metro ticket prices

The Transportation Ministry is apparently planning to reintroduce in the House of Representatives a plan to raise Cairo Metro tickets to EGP 3, sources tell Al Shorouk. Cairo Metro has prepared a detailed plan which was reviewed by the Transportation Minister and will present it to the House Transport Committee. The House previously rejected the metro’s plan to raise prices.

Banking + Finance

Etisalat Egypt in negotiations with private banks for EGP 6 bn loan

A private bank is studying arranging an EGP 6 bn loan for Etisalat Egypt in which the Abu Dhabi National Bank and Emirates NBD are set to participate, banking sources told Al Shorouk. The loan will be used to finance future expansions in the domestic market, including funneling investments of EGP 10-12 bn over a period of five years into infrastructure expansions.

Saudi’s Al Fanar signs agreement to borrow EGP 800 from QNB Egypt

Saudi’s Al Fanar as signed an agreement with Qatar National Bank Egypt for an EGP 800 mn loan to finance a 50 MW solar power plant in Egypt, Al Shorouk reported. The company is looking to obtain a separate EGP 2.5 bn loan to finance a 200 MW solar power plant, sources said. The two plants are Al Fanar’s first renewable energy projects, having already established two companies for the projects in accordance with the regulations of the Egyptian Electric Utility and Consumer Protection Regulatory Agency.

Egyptian Electricity Transmission Company signs USD 450 mn loan agreement with SACE, BNP Paribas end of month

The Egyptian Electricity Transmission Company (EETC) signed a USD 450 mn loan agreement with Italy’s export credit agency SACE and French bank BNP Paribas to finance upgrading the electricity grid through multiple projects, Al Borsa reported. Alstom is also looking to implement an MoU signed with EETC to build four transformer stations, three with capacities of 550 kV and one with 220 kV, sources told Al Borsa.

FEP Capital to invest EGP 2 bn in small and medium enterprises

First Equity Partners Capital, a private equity, investment banking and consulting firm, plans to invest EGP 2 bn in Egypt’s SMEs, raising it from the current EGP 400 mn, CEO Omar El Maghawry said, according to Youm7.

Other Business News of Note

MBC files USD 6 mn lawsuit against Presentation Sports

MBC has filed a USD 6 mn lawsuit against Egypt’s Presentation Sport for breaching an agreement to allow MBC to broadcast Egyptian Premier League games, Al Mal reports. Presentation was contractually obligated to pay MBC if the contract was violated but had been stalling, MBC alleges. Presentation was acquired earlier this month by Ahmed Abou Hashima’s Egyptian Media Company.

National Security

US military defence delegation in Cairo to talk bilateral security

Minister of Defence Sedqi Sobhi met Sunday (domestic press has the meeting taking place on Saturday) with head of the US military’s Defense Intelligence Authority Vincent Stewart in Cairo to talk military cooperation between the two countries, according to Ahram Online. Stewart, who is heading a military delegation, also met with Egypt’s military chief of staff Mahmoud Hegazy to discuss bilateral security cooperation and exchanging military expertise. The talks were also attended by US Ambassador to Egypt Stephen Beecroft.

Mistral-class helicopter carrier heads to Egypt

The Mistral Class helicopter carrier Gamal Abdel Nasser has left France and is heading to Egypt, Al Masry Al Youm reports.

On Your Way Out

Pope Tawadros II declared The Virgin Mary Church in East Cairo’s Zeitoun district a new papal headquarters, Ahram Online reported. “This is the third location that has been named as a papal headquarters. The two other headquarters are the Abbasiya Cathedral, also in Cairo, and the Saint Bishoy Monastery in Alexandria’s Wadi El-Natroun.”

The markets yesterday

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USD CBE auction (Tuesday, 7 June): 8.78 (unchanged since Wednesday, 16 March)
USD parallel market (Saturday, 11 June): 10.92-10.95 (compared to 10.90 on Tuesday, 7 June, domestic press)

EGX30 (Sunday): 7,650.62 (-1.36%)
Turnover: EGP 309.8 mn (29% below the 90-day average)
EGX 30 year-to-date: +9.20%

THE MARKET ON SUNDAY: Egypt’s benchmark index fell 1.4% on Sunday. EFG Hermes and Telecom Egypt were the only constituents to close in the positive territory. The EGX30’s worst-performing constituents were OTMT, Edi­ta, and Porto Group. The index’s largest constituent, CIB, was down 2.0% on the day. Market turnover hit EGP 309.8 mn, with local investors being the sole net buyers.

Foreigners:Net short | EGP -19.2 mn
Regional:Net short | EGP -16.3 mn
Domestic:Net long | EGP +35.5 mn

Retail: 59.4% of total trades | 64.9% of buyers | 54.0% of sellers
Institutions: 40.6% of total trades | 35.1% of buyers | 46.0% of sellers

Foreign: 6.7% of total | 3.6% of buyers | 9.8% of sellers
Regional: 13.1% of total | 10.5% of buyers | 15.8% of sellers
Domestic: 80.2% of total | 85.9% of buyers | 74.4% of sellers

WTI: USD 49.07 (flat)
Brent: USD 50.54 (flat)
Gold: USD 1,275.90 / troy ounce (flat)
Nymex (futures prices) USD 2.56 MMBtu, (flat, July 2016 contract)

TASI: 6,570.9 (-0.5%) (YTD: -4.9%)
ADX: 4,367.9 (-0.3%) (YTD: +1.4%)
DFM: 3,336.1 (-1.0%) (YTD: +5.9%)
KSE Weighted Index: 355.7 (+0.2%) (YTD: -6.8%)
QE: 9,794.0 (-0.4%) (YTD: -6.1%)
MSM: 5,868.4 (-0.3%) (YTD: +8.5%)
BB: 1,115.9 (-0.3%) (YTD: -8.2%)

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Calendar

13 June (Monday): Apple’s Worldwide Developers’ Conference gets underway with a keynote speech at 7pm CLT.

14-15 June (Tuesday-Wednesday): The U.S. Federal Open Market Committee meets to discuss interest rates.

15 June (Wednesday): Buying season for Egypt’s domestic wheat harvest officially ends.

16 June (Thursday): The Central Bank of Egypt’s Monetary Policy Committee meets to consider interest rates.

21 June (Tuesday): Trial of former Central Auditing Organization chief Hisham Genena resumes.

23 June (Thursday): It’s Brexit Day as the United Kingdom holds a referendum on whether or not to leave the European Union.

27 June (Monday)” Beltone Financial’s general assembly to decide on converting a third of its share capital to GDRs, according to Reuters.

06-08 July (Wednesday-Friday): Eid El Fitr (national holiday, tentative date)

05-08 September (Monday-Thursday): The 6th EFG Hermes London MENA and Frontier Conference, Emirates Arsenal Stadium, London, U.K.

11-13 September (Sunday-Tuesday): Eid El Adha (national holiday, tentative date)

19-20 September (Monday-Tuesday): Euromoney Egypt, venue TBD

02 October (Sunday): Islamic New Year (national holiday, tentative date)

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

November (TBD): Delegation of German companies in the renewable energy sector due to visit to discuss investment opportunities.

01 November (Tuesday): Prophet’s Birthday (national holiday, tentative date)

27 November (Sunday): 2016 Cairo ICT, Cairo International Convention Centre

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

04-06 December (Sunday-Tuesday): Electricx exhibition, Cairo International Convention Centre

11-13 December (Sunday-Tuesday): The Middle East Fire, Security & Safety Exhibition and Conference (MEFSEC), Cairo International Convention Centre, Cairo

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