Thursday, 21 July 2016

Amer hints at devaluation (again) and outlines recipe for economic recovery

TL;DR

What We’re Tracking Today

MPs voted yesterday to give pensioners a raise. Citizens collecting state pensions will get a raise retroactive to 1 July 2016. As near as we can piece together from muddled (and sometimes conflicting) media reports, the House voted to give pensioners minimum raises of 10% or EGP 125 per person (whichever is greater), a move estimated to cost state coffers something in the range of EGP 2-2.6 bn. In parallel, MPs also voted to raise the minimum pension to EGP 500 per month after factoring-in this year’s raise increment, a move that will cost a further EGP 16 bn, adding about 20% to the total pension bill for 2016-17. Need more? Go hit up Al Borsa, Al-Shorouk and Akhbar Misr (state broadcaster ERTU’s news portal).

Meanwhile: 57 of the 76 articles of the Civil Service Act have now been approved by the House of Representatives, which passed a further 18 articles on Wednesday, Ahram Gate reports. The House is expected to continue voting on the bill today.

Foreign Minister Sameh Shoukry is due in Washington today for a ministerial-level meeting of the anti-Daesh coalition. FM Shoukry will also take part in a number of multilateral talks on the sidelines of the coalition meeting.

It’s Revolution Day Weekend as the nation observes the anniversary of the 23 July 1952 revolution. The national holiday falls on Saturday, making it a public service holiday; private-sector working stiffs such as ourselves will nevertheless have our noses to the grindstone: There’s no sign at time of dispatch that the government plans to make Sunday a day off to compensate for the holiday falling on a weekend.

On The Horizon

Interest rates are on review next week: The Central Bank of Egypt’s Monetary Policy Committee will meet on Thursday, 28 July to review interest rates. That’s one day after the U.S. Federal Reserve’s Federal Open Market Committee wraps a two-day meeting for the same purpose.

** Saving Cairo from Itself

Why is your day in Cairo so hard — and what can we do about it?

Cairo is a tough city to love. It takes from us, on average, four hours of our lives each day commuting to and from work and getting errands done. For those not fortunate enough to live in a gated community, public space is often a rented plastic chair on a bridge or a blanket in the middle of a roundabout. The implications for human health and happiness of a life spent in Cairo are well-known and reasonably well-documented.

It wasn’t always this way: Our grandparents and parents tell us stories of a time when they could walk to university, ride a bus (and find a seat) and have access to public space that was maintained and pleasant to use. Cairo was referred to as the Paris of the East.

What happened? We grew and changed — and Cairo didn’t adapt. Citizens from across the nation migrated to Cairo like never before, and the capital city grew at alarming, unprecedented rates.

Today, Cairo is at a crossroads. Turn right, and we can rebuild one of the world’s most iconic cities. Or keep left on our current course and continue to grow far below our potential. The only way to move off the default path is for all the actors in our city — business and government alike — to  agree to shed yesterday’s baggage and preconceptions and start a real conversation. [ Tap here to read the rest of part one in the series. ]

** This is part one of a five-part series by SODIC, a leading real estate developer and proud sponsor of Enterprise. Here, SODIC shares its view on how business and government can work together to save Cairo — doing good for more than 20 mn people and making a reasonable profit at the same time. Subsequent instalments will appear each Thursday morning, exclusively in Enterprise.

Speed Round

Speed Round is presented in association with

Central Bank of Egypt Governor Tarek Amer has ruled out floating the EGP anytime soon, while hinting that he might resort to devaluation “at the appropriate time,” according to a statement by Amer following a meeting with the House of Representatives’ Economic Affairs Committee to discuss monetary policy, Al Mal reported on Wednesday. Before the Eid break, Amer had said that holding the EGP at a specific exchange rate in the past was a “big mistake,” which caused speculation to mount over a potential devaluation and fueling a rise in equities.

As for his views on how to address the weakening economy, he reckoned that floating the shares of state-owned companies on the EGX, tax reforms (including passing the value-added tax) and improving the investment climate are three key measures to help with growth. The committee has asked Amer to provide data on Egypt’s external debt position; Amer is expected to have another meeting with the committee next week, MP Medhat El Sherif told Al Mal.

EGP at a new record low against the USD: The EGP weakened again on Wednesday with Al Shorouk putting the parallel market rate at yet anotherrecord-low level of EGP 11.80 per USD 1, while Reuters put the figure at EGP 11.75. Economists told Reuters that a further weakening of the EGP on the black market is in the cards.

The Ismail government officially published its FY2016-17 budget in the Official Gazette yesterday. The proposal as published can be viewed here (pdf, in Arabic) via Al Borsa.

Enel Green Power pulling out of Egypt? Italian renewable energy firm Enel Green Power reportedly informed the Electricity Ministry that it was backing out of feed-in tariff (FiT) projects worth USD 300 mn, industry sources tell Al Borsa and may shut its office in Egypt. These include a 50 MW solar power plant in Benban and two 100 MW wind power plants. Electricity ministry and company officials will meet next week to discuss the issue, a ministry source said. The pullout comes on the back of the dispute with the government over its insistence on domestic arbitration which has scared off foreign funding for the FiT projects. Excessive red tape was cited as another reason by sources for Enel’s departure. Enel Green is the second company to back out from feed-in tariff projects after Saudi’s Abdul Latif Jameel exited in April.

M&A Roundup: Naeem Holding will finalize the acquisition of AT Financial and AT Brokerage within the month, having completed due diligence, a source at Naeem Holding told Al Borsa. Naeem had signaled its interest in acquiring the two companies this past March. Mubasher and Sigma Capital had also reportedly been interested in snapping up the brokerage.

Mega Investment will close an agreement to acquire Acumen Securities & Brokerage, a subsidiary of Acumen Holding, within days, sources told Al Borsa. When negotiations started last April, the plan was a merger between Mega and Acumen, sources said.

It’s 4G theater… In a little piece of politico-corporate theater, CIT Minister Yasser Al Qady has reportedly told officials from Kuwait’s Zain that domestic companies are at the head of the line for 4G licenses, an unnamed government source told Al Borsa. At a meeting attended by Prime Minister Sherif Ismail, Al Qady reiterated the government line that international tender will be in the works if any of the local telecom operators back down from applying for a 4G license. As we noted on Monday, Zain had formally requested to apply for a 4G license last Thursday.

Leading business and investor associations are lobbing criticisms at the value-added tax (VAT) legislation. The VAT will make life difficult for investors, said Hassan Ratib, deputy head of the Egyptian Union of Investors Associations, literally hauling out the “goose that lays the golden egg” metaphor. Federation of Egyptian Industries head Mohamed El Sewedy said the tax will fail to bring the informal economy into the tax system and reiterated the FEI’s call that the EGP 500K mandatory minimum income level for registering for the VAT be scrapped. Mohamed El Bahay, head of the FEI’s taxation committee, tells Al Mal that the FEI will lobby the House of Representatives to amend the legislation. Ahmed Sheeha, head of the Importers Division of the Cairo Chambers of Commerce, implied that the VAT runs contrary to promises to draw in new investments. Ali Eissa, head of the Egyptian Businessmen’s Association, called for the minimum threshold required for registration be abolished so that a comprehensive taxation record be established.

Finance Minister Amr El Garhy is set to appear before a House committee on Tuesday in hearings on the VAT, as will representatives from the FEI, export councils and chambers of commerce, according to unnamed sources in the planning and budget committee speaking to Daily News Egypt on Tuesday. A request was reportedly submitted to El Garhy to have the ministry set the tax value in the draft law, as well as submit the tables of the general sales tax law from the Tax Authority. The finance ministry had previously suggested a baseline of 14%, but had left the decision up to the House.

Enterprise hates taxes. There, we said it. We’re capitalist, profit-loving scum who enjoy paying our staff living wages. Every penny paid in tax eats into that. But we wonder: What’s going to pay for the social safety net? What’s going to continue to build public infrastructure? Aren’t public finances every bit as important as our own? And if the VAT is a measure we all [redacted] know the IMF is going to demand — and if we agree the IMF facility is one of the keys to getting the economy moving again — then what would the chattering class suggest the Ismail government do? Our present tax system is rife with corruption and leaky as a sieve. Who among us, at the retail level, hasn’t been told we’ll need to pay an extra 10% if we “want a tax invoice”?

If not at VAT, then what? The train has left the station, folks. The question is not should we have a VAT, it’s can we implement it in a way that’s fair to all, and maximally fair to low income earners? Rather than growling about its inflationary impact or demanding some shopkeeper (who makes in a year what one of us spends on a vacation) be included in the system, shouldn’t we be talking constructively with Finance about how to best implement the measure? The VAT is coming to Egypt, as it has to nearly every country on the planet except for the United States. (Check out this infographic from the New York Times, and forgive it its error: It includes Egypt as having a VAT in 2009.)

The Egyptian Civil Aviation Ministry denied Russian reports that Egypt has completed investigations into the crash of the Metrojet flight in Sinai, according to an official statement. The ministry says Civil Aviation Minister Sherif Fathy did meet with Russian Transport Minister Maxim Sokolov, but stresses that the Prosecutor General’s office will be the entity to present any updates regarding the investigation. The Prosecutor General will travel to Russia to present all updates “next week,” the statement said. Sputnik had reported that Fathy announced that the investigation into the crash entered its final stage.

Russians haven’t booked a date to come inspect security at Egyptian airports: A representative of Russia’s Transport Ministry said “the visit date of Russian specialists for completion of the security audit of Egyptian airports has not yet been fixed and depends on fulfillment of security requirements,” according to TASS. Fathy had invited Russian experts to assess airport security in Egypt during his visit, Daily News Egypt reported.

Another (small) step toward local election: The Ismail Cabinet held its weekly cabinet meeting on Wednesday, approving the Local Administration Act which would set up local elected councils and organize their elections. The law would allow 25% of council seats to individual candidates, while 75% of the seats would be set up for coalition lists, with a quota of 50% of council seats reserved for farmers and workers. Cabinet also signed-off on amendments to the Public Roads Act that would see a fine of EGP 10,000 imposed on unlicensed roadworks or obstructions of public roads. Also, NUCA will get 992 feddans of land for New Toshka.

Ezz Steel reported a 1Q2016 net loss after tax and minority interest of EGP 136.90 mn even though sales grew to EGP 4.97 bn from EGP 4.79 bn a year ago. Ezz Steel blames “weak exports and a chronic gas shortage” as factories were operating at less than 50%, Reuters notes.

Net profits after tax of the Egyptian Gulf Bank increased by 99.7% to EGP 240.6 mn y-o-y in 1H16, the bank said in its disclosure. The bank gave loans of EGP 4.4 bn in loans in 1H16, increasing its loan portfolio to a total of EGP 12.6 bn in funding end of June compared.

MOVES- GE appointed Joseph Anis as President & CEO for Power Services in the Middle East & Africa, according to a statement on Tuesday. Anis replace Azeez Mohammed, who is now CEO for GE Energy Connection’s Power Conversion unit in Paris. Anis has been with GE since 1997, most recently having been made vice president and officer in 2010.

Turkish President (for the time being) Recep Tayyip Erdogan sat down for an extended interview with Al Jazeera on Wednesday (watch in Arabic, running time: 37:31), where he discussed surviving a coup, before getting to the one subject he is truly passionate about, which of course, is Egypt. “The people of Syria and Egypt are passionate about democracy,” Erdogan said. “Egyptian President Abdel Fattah El Sisi has nothing to do with democracy. He killed thousands of his own people.” There is no mention of Egypt or El Sisi in Al Jazeera’s truncated English dub of the interview (7:18), or the accompanying article.

Meanwhile, the former director of Al Jazeera news channel, Wadah Khanfar, said to Turkey’s state news agency Anadolu on Wednesday: “I doubt that such a coup could be made without first consulting — or at least informing — the Americans…. In my estimation, the Americans knew of the matter [i.e., the coup attempt] but they didn’t overtly embrace it.”

Egypt’s foreign affairs ministry issued a statement (Arabic) in response to Erdogan’s comments, which read in part “The [Turkish] president continues to confuse issues and to lose his sense of judgment, which reflects the difficult circumstances he is going through. Among the issues which the Turkish president confuses the most is the ability to differentiate between a full-fledged popular revolution where over 30 mn Egyptians went out calling for the armed forces’ support and military coups by definition.”

Erdogan announced a three-month state of emergency during a televised press conference on Wednesday night, the Guardian reported. The entirety of the country’s academics were also slapped with a work travel ban, as potential accomplices were perceived as flight risks. All 1,577 deans of public and private universities have resigned at the state’s request. As for what motivated the coup plotters, “Intelligence sources say many of the officers who took part in the coup were on a list of some 600 high-ranking military personnel accused of Gulenist ties that was submitted by the national intelligence… The officers were facing dismissal in August,” the Guardian notes.

In response to Turkey’s numerous requests for extradition of cleric Fethullah Gulen, US Secretary of State John Kerry said on Wednesday that he had told Turkish Foreign Minister Mevlut Cavusoglu “Please don’t send us allegations, send us evidence.”

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Egypt in the News

It’s a delightfully quiet morning for Egypt in the international press. In the U.K., coverage is all about Boris Johnson mistakenly referring to the “Egypt crisis” in an appearance with U.S. Secretary of State John Kerry, when in fact he meant Turkey. The U.S. press, meanwhile, seems more interested in digesting a blog post that claims Egypt is the most rectangular country in the world. MASR.

Three Canadians unjustly imprisoned in Egyptian jails — including Mohamed Fahmy — have together written an op-ed for the Toronto Star demanding Canadian PM Justin Trudeau “make the call” the President Abdel Fattah El Sisi to ask that former Morsi staffer Khaled Al-Qazzaz be allowed to leave Egypt. Al-Qazzaz has been released from prison, but still faces a travel ban; he is a permanent resident of Canada.

In another snow-bound nation: The Russian press is alive with speculation that Egypt is behind a USD 2 bn arms agreement that “could be set to save the struggling MiG aircraft company.” The story covers MiG’s sale of MiG-29 “Fulcrum” fighter jets to Egypt, a story we first discussed last month.

The Macro Picture

The US Energy Information Administration (EIA) released its weekly petroleum status report(pdf) on Wednesday, showing a 2.3 mn barrel decrease in US crude inventories, beating expectations of analysts polled by S&P Global Platts who had expected a drop of 1.25 mn barrels. Despite the drop, the report notes “US crude oil inventories are at a historically high levels for this time of year.” Further, US gasoline inventories increased by 0.9 mn barrels last week. Most oil price futures responded positively to the news of declining crude inventories, while prices for US gasoline were down 20% y-o-y.

Nearly every major oil player has significantly increased their share of production of natural gas relative to petroleum over the past 15 years, except for BP, data from Bloomberg shows. Explaining the rationale behind Royal Dutch Shell’s acquisition of BG, which helped solidify Shell’s control of over 20% of the global LNG market, Shell’s chief executive Ben van Beurden says “We’re more a gas company than an oil company. If you have to place bets, which we have to, I’d rather place them there.” “[Gas is] considered a crucial ‘bridge fuel’ in the transition to a low-carbon future, because gas-fired power plants are far cleaner than those that burn coal,” according to the piece. “They’re also relatively cheap to build and easy to switch on and off, making them a natural complement to solar and wind generation. Shell is also working to create a market for gas-fueled vehicles, especially ships and heavy trucks that, unlike cars, won’t go electric soon.”

Egypt in the News

The Guardian’s David Batty profiled The Solar Grid, a graphic novel by Egyptian artist Ganzeer. The artist, best known for his murals in Cairo post-2011, “took inspiration from his first sighting of the Nile’s Aswan dam.” He says “it was so breathtaking, being on top of this huge machine. But as I’ve grown older and become more concerned for the environment, it feels like if humanity ever had a warning sign in regards to the impending doom of the earth, that Egypt is probably it.”

Worth Reading

First described by researchers Brendan Nyhan and Jason Reifler in their 2006 study ‘When corrections fail: The persistence of political misperceptions’ (pdf), the backfire effect is the comprehensively soul-crushing psychological phenomenon that when confronted with unassailable evidence that their previously held belief was false, people may not only reject the evidence, but dig in even deeper into their false beliefs. “Just as confirmation bias shields you when you actively seek information, the backfire effect defends you when the information seeks you, when it blindsides you,” notes David McRaney of the blog You Are Not So Smart, dedicated to exploring the concept of self-delusion. “A great example of selective skepticism is the website literallyunbelievable.org. They collect Facebook comments of people who believe articles from the satire newspaper The Onion are real,” including “articles about Oprah offering a select few the chance to be buried with her in an ornate tomb.” (Read: The backfire effect)

Image of the Day

Clash movie poster is out and we love it: The poster for Egyptian director Mohamed Diab’s movie Clash [Eshtebak], which screened at Cannes Film Festival last May, is finally out. The film will arrive at Egyptian theatres next Wednesday. Remember artist Ahmed Emad Eldin, who was behind Pink Floyd’s ‘Endless River’ album cover art? He designed this poster as well. Set during the 2013 demonstrations, the movie is entirely shot inside a police van. Here’s another poster for the film also by Emad Eldin. Watch the trailer in Arabic, running time: 1:37.

Worth Watching

Predicting corporate fraud: Big Think sits down with Georgetown assistant professor Robert Davidson to talk about the results of his study (abstract) which examines the relationship between where an executive sits on the spectrum from materialistic to frugal and the level of unintentional errors and fraud cases associated with their firm. (Watch, running time: 5:29)

Diplomacy + Foreign Trade

The Foreign Affairs Ministry has renewed its travel warning to Libya, according to an official statement. The ministry also urged Egyptians already in Libya to exercise caution and to stay away from conflict zones. It also warned against following smugglers who offer to transport Egyptians to Libya.

Supply Minister Khaled Hanafy met with tea and meat producers from Kenya to form a strategic partnership that aims to bolster Egyptian imports and open new markets for Egyptian exports, Al Shorouk reported. Kenya recently imported brown sugar from the Sugar and Integrated Industries Company, said Hanafy.

Energy

Legislation to deregulate the natural gas market is with Maglis El Dowla

If you were wondering what happened to the Natural Gas Act, which would deregulate the natural gas industry and see the state step back to become the market regulator and provider of pipelines, it is with the Egyptian Council of State (Maglis El Dowla), according to Amira El-Mazni, Vice Chairman of EGAS. Her statements came at a seminar on the Natural Gas Act hosted by the British Egyptian Business Association. Industry execs at the gathering expressed frustration with how long it has taken to move the law forward, pointing out it was signed-off by cabinet nine months ago. The consensus at the seminar was that the act was crucial to attracting new investments, Al Borsa reports.

FSRU tender attracts four major firms

The tender to lease a third floating and storage regasification unit (FSRU) has drawn interest from four international firms, an official told Reuters. Those interested include Norway’s Hoegh and BW Gas, who are currently supplying Egypt with one FSRU each, as well as Excelerate Energy. The official did not name the fourth firm, but noted that “the door to present offers is open until the end of next week so offers can be decided on in the period between the end of August and the beginning of September.” On a side note, five unnamed Egyptian and foreign companies have applied to EGAS for a license to import LNG, Al Borsa reported on Wednesday.

EGPC amends PSA agreement terms

EGPC has announced amendments to its production sharing agreements with foreign partners, according to Al Borsa. EGPC cancelled a provision requiring IOCs to give up part of the exploration zone within a concession every two years. It also increased the amounts capped for cost recovery in production sharing agreements to 40%, instead of 35%. The amendments will not be implemented retroactively but will applied to EGPC’s most recent tender for 11 concessions.   

Infrastructure

Red Sea Ports Authority to issue international tender for Port Safaga multi-purpose platform

The Red Sea Ports Authority is set to issue an international tender to build a multi-purpose platform at Port Safaga in a month’s time, the head of the authority said, adding that they are currently awaiting the approval of the Transportation Ministry on the finalized bidding terms, Al Borsa reported on Wednesday.

Basic Materials + Commodities

Blumberg Grain’s completed storage system not operational due to weak power supply

Blumberg Grain’s shouna wheat storage systems, completed as part of phase one of a grain storage project undertaken with the Supply Ministry in 2014, had not been fully operational due to weak electricity supplies, said company chief David Blumberg, according to Al Borsa. He places primary responsibility for this on the Supply Ministry’s General Company for Silos and Storage (GCSS), which was apparently to supply the facilities with power. Mahmoud Abdel Aziz, head of the GCSS, retorted that he received no official complaint from Blumberg Grain on the situation. Al Borsa is also running an unsubstantiated claim from unnamed sources that Blumberg had written to the president on the situation and had set a deadline of 5 August for resolving the issue before pulling out of Egypt and abandoning the development of a 30 feddan grain treatment and assembly center in East Port Said.  

Wheat silo owners intend to submit memorandum to General Prosecutor

A group of wheat silo owners intend to submit a memorandum to the Prosecutor General about what they characterize as exaggerated estimates by the House of Representatives fact-finding committee on fraudulent supply reports, Daily News Egypt reported on Tuesday. The group of silo owners contend that the committee alleges EGP 7 bn in unaccounted for supplies. As we have previously noted, the committee has yet to issue its final report, which is expected to be completed by the end of the month. Its last statement claimed EGP 200 mn was estimated as missing.

Juhayna plans to increase sales by 20% in 2016 y-o-y to EGP 5 bn

Juhayna is planning to grow sales 20% year-on-year to EGP 5 bn by the end of 2016 compared, CEO Seif Thabet told Amwal Al Ghad. The company plans to add three new dairy lines before year’s end, following the addition six juice and yogurt production lines before Ramadan, Thabet added. Juhayna had said last month it plans to invest EGP 640 mn in growth in 2016.

Manufacturing

Indian firm invests USD 280 mn in chemicals sector

Indian firm TCI Sanmar Chemicals will invest USD 280 mn into its Egyptian unit to bolster its polyvinyl chloride (PVC) production to 400k tonnes annually, Trade and Industry Ministry Tarek Kabil told Ahram. Production from the facility will be directed towards the domestic market, said company Director P. S. Jayaraman in a meeting with Kabil.

Port Said governorate issues 108,000 sqm for EGP 1.6 bn investments

Port Said governor signed an agreement with a group of investors which would provide 108k sqm for manufacturing projects worth EGP 1.6 bn, Amwal Al Ghad reported. The investments include tyres manufacturing, vegetable oil refining, packaging and extracting, manufacturing energy-saving light bulbs and producing reinforcement steel.

Four cement companies in talks to build waste-to-energy plants to diversify energy mix

The Environment Ministry is in talks with four cement companies to build waste-to-energy facilities to supply their factories in an effort to diversify their energy sources beyond coal, a ministry source tells Al Borsa on Wednesday. El Amreyah Cement Company and Lafarge Egypt were among the companies interested, with El Amreyah noting that it would likely begin building its plant in the next few months. The government plans to help these companies source the waste needed to power the cement plants through a waste collection initiative it is launching in cooperation with the Social Fund for Development.

Real Estate + Housing

Egyptian Council of State shoots down NUCA’s new real estate regulations

The Egyptian Council of State (Maglis El Dawla) apparently shot down NUCA’s new real estate regulations last week, sources tell Al Mal. Remember those? NUCA had drawn up and ratified a series of new regulations for the real estate market back in October, set guidelines for bidding on tenders; establish a ranked database for developers; streamline bureaucratic procedures; set penalties for investors who do not meet terms and conditions; and form a committee to expedite ongoing disputes with developers and investors. These new regulations apparently violate certain clauses of the authority’s own executive regulations, said the source, who didn’t specify the offending articles.

PHD announces reverse stock split for GDRs

Palm Hills Developments announced a ratio change in its depositary receipt program, according to a statement from the developer on Wednesday, entailing a reverse stock split on the basis of one new depositary share for every four depository shares as of end of day 29 July 2016. Effective 1 August, all holders of the old GDRs will need to switch them out to receive one new depositary share for every four old.

Automotive + Transportation

Three international bids to finance Cairo Metro lines five and six

The government has received proposals from three international lenders to finance Cairo Metro lines five and six, Transportation Minister Galal Saeed told Al Shorouk. The offers came from South Korea, China, and the EU, he added. The ministry is currently studying the proposals before selecting the winning bid, he said.

Banking + Finance

MasterCard plans to grow customer base in Egypt to 20 mn by 2017’s end

MasterCard is planning increase the number of clients it serves to 20 mn by the end of 2017 from 15 mn currently, MasterCard’s Egypt country manager Magdy Hassan told Reuters’ Arabic service in an interview. Handling cash is fraught with risks and involves costs amounting to 1-1.5% of GDP, Hassan says. Even though the company has managed to move the public sector’s payrolls to an electronic system, it still believes that there are more opportunities in increasing electronic payments for taxes, customs, and other services.

On Your Way Out

President Mike Pence? Does Donald Trump even want to be president? An alleged inside account of Trump’s son approaching Gov. John Kasich’s camp on a possible vice presidency calls into question Trump Sr.’s interest level in governing, according to a report in The New York Times Magazine on Wednesday. “Did [Kasich] have any interest in being the most powerful vice president in history? When Kasich’s adviser asked how this would be the case, Donald Jr. explained that his father’s vice president would be in charge of domestic and foreign policy. Then what, the adviser asked, would Trump be in charge of? ‘Making America great again’ was the casual reply.” While Donald Jr. disputes the adviser’s account of the conversation, it would echo comments made by Trump’s chief strategist Paul Manafort in May: “He needs an experienced person to do the part of the job he doesn’t want to do. He seems himself more as the chairman of the board, than even the CEO, let alone the COO.”

Ben Carson is staying relevant this week at the Republican National Convention by drawing attention to Hillary Clinton’s links to Lucifer. (Watch, running time: 1:11)

The markets yesterday

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USD CBE auction (Tuesday, 19 July): 8.7800 (unchanged since Wednesday, 16 March)
USD parallel market (Wednesday, 21 July): 11.80-11.75 (up from 11.75-11.70 on Tuesday, 19 July, Shorouk, Reuters)

EGX30 (Wednesday): 7,503.4 (-1.23%)
Turnover: EGP 511.6 mn
EGX 30 year-to-date: +7.0%

Foreigners: Net Short | EGP -8.7 mn
Regional: Net Short | EGP – 3.7 mn
Domestic: Net Long | EGP +12.4 mn

Retail: 68.5% of total trades | 65.6% of buyers | 71.3% of sellers
Institutions: 31.5% of total trades | 34.4% of buyers | 28.7% of sellers

Foreign: 13.7% of total | 12.9% of buyers | 14.6% of sellers
Regional: 4.8% of total | 4.4% of buyers | 5.1% of sellers
Domestic: 81.5% of total | 82.7% of buyers | 80.3% of sellers

WTI: USD 45.73 (-0.04%)
Brent: USD 47.18 (+0.02%)
Natural Gas (Nymex, futures prices) USD 2.65 MMBtu, (-0.49%, Aug 2016 contract)
Gold: USD 1,311.90 / troy ounce (-0.56%)

TASI: 6,630.6 (-0.2%) (YTD: -4.0%)
ADX: 4,612.4 (+0.6%) (YTD: +7.0%)
DFM: 3,546.5 (+0.6%) (YTD: +12.6%)
KSE Weighted Index: 352.01 (+1.0%) (YTD: -7.78%)
QE: 10,591.6 (-0.5%) (YTD: +1.6%)
MSM: 5,816.8 (-0.4%) (YTD: +7.6%)
BB: 1,167.3 (-0.5%) (YTD: -4.0%)

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Calendar

21 July (Thursday): Foreign Minister Sameh Shoukry is due in Washington for a ministerial meeting of the anti-Daesh coalition. 23 July (Saturday): Revolution Day, marking the 1952 Revolution. We’re expecting that Sunday will not be a national holiday despite the statutory day falling on the private-sector weekend. 25 July (Monday): The European Bank for Reconstruction and Development, European Investment Bank, and World Bank launch their joint report: What’s holding back the private sector in MENA? Conrad Hotel, Cairo. 28 July (Thursday): Central Bank of Egypt’s Monetary Policy Committee meets to review rates. 28 July (Thursday): Ruling expected on charges of disseminating false news against former Central Auditing Organization head Hisham Genena. 07 August (Sunday): Deadline for mobile operators to submit applications for 4G licences 29-30 August (Monday-Tuesday): Wastewater Egypt conference. 05-08 September (Monday-Thursday): The 6th EFG Hermes London MENA and Frontier Conference, Emirates Arsenal Stadium, London, UK. 11-13 September (Sunday-Tuesday): Eid El Adha (national holiday, tentative date). 19-20 September (Monday-Tuesday): Euromoney Egypt conference, venue TBD. 22 September (Thursday): Central Bank of Egypt’s Monetary Policy Committee meets to review rates. 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. 11-12 October (Tuesday-Wednesday): Global Islamic Economy Summit, Madinat Jumeirah, Dubai. 17 November (Thursday): Central Bank of Egypt’s Monetary Policy Committee meets to review rates. 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 December (Sunday): Prophet Muhammad’s Birthday (national holiday; date to be confirmed). 11-13 December (Sunday-Tuesday): The Middle East Fire, Security & Safety Exhibition and Conference (MEFSEC), Cairo International Convention Centre, Cairo. 29 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee meets to review rates.

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