Monday, 29 August 2016

It’s Groundhog Day for wheat industry as ergot limits return. Also: VAT set at 13% this year, 14% next.

TL;DR

What We’re Tracking Today

The House of Representatives will discuss the fact-finding report on allegations of corruption in the domestic wheat-buying program. Reuters reviewed the report, which it says finds that the government played a key role in “wasting public funds.” The report claims “government entities neglected their own storage facilities in favor of less regulated private sites, made contracts with ‘fake entities,’ and oversaw flawed reforms that caused subsidy spending to increase rather than decrease as publicly stated.” The scandal’s second victim, after now-former Supply Minister Khaled Hanafy, is the ministry’s spokesperson, who told Reuters he resigned from his post and could no longer comment on the issue. The fact-finding committee has called on protection for whistleblowers and witnesses in the case, Al Masry Al Youm said.

The Ismail government appears to have flip-flopped once more on ergot contamination in wheat imports, with Agriculture Ministry announcing yesterday a total ban on wheat with any level of the fungus. Cabinet had previously agreed to accept the UN FAO’s standard of 0.05%. More in Speed Round, below.

A Russian delegation is set to arrive as early as today to investigate airport security ahead of possibly lifting the flight ban on Egypt entirely, TASS reported.

The annual meeting of the Egyptian-Jordanian Commission and the conference Wastewater Egypt both begin today.

What We’re Tracking This Week

El Sisi to visit India, China: President Abdel Fattah El Sisi is expected to make a stop in India on a state visit on Monday en route to the G20 summit in China, which will take place next week.

Feed-in tariff news coming this week? Electricity Minister Mohamed Shaker is reportedly due to hold a press conference this week to discuss the embattled program. Also this week: Oil Minister Tarek El Molla is due in Cyprus for talks.

Speed Round

Speed Round is presented in association with

The House of Representatives has approved a baseline rate for the value-added tax. The VAT will ring in at 13% in year one and then rise to 14% in year two, Al Borsa reports. The House set the baseline rate in the same session as a show-of-hands vote approved the VAT in principle after a last pitch by Finance Minister Amr El Garhy. That sets-off a final round of debate on the measure that could end with a vote as soon as tomorrow — MPs have said they could vote on the VAT after as little as three sessions of debate. The government says the law will come into effect in October if the House approves it this week.

The state is expected to pull in about EGP 20 bn in FY 2016-17 at a 13% rate, said Deputy Finance Minister Mohamed Moeit. The 1 ppt cut from the 14% baseline rate the ministry had proposed will slash at least EGP 8 bn off the EP 32 bn in annual receipts the ministry was hoping to net, while state coffers will lose an additional EGP 4 bn in revenues because the measure will be in effect for only 10 months of the current fiscal year. The House Planning and Budget Committee is predicting the VAT will see the state collect an additional EGP 24 bn, but its math doesn’t factor-in the two-month delay in approving the measure.

The House deliberated on 39 articles and voted to approve the first 10 of them during yesterday’s debate, Al Borsa reports. The approved articles govern the transition from the sales tax to the VAT regime and allow businesses a three-month grace period to comply with the law. Discussions over the next few days will be expected to include the law’s exemptions list, according to the newspaper. As we noted yesterday, the Finance Ministry added international school tuition and pharma products to the list of exemptions, but will not announce the full list until after the legislation is voted on.

Detractors in the House: The VAT passed in principle thanks to the backing of the dominant Support of Egypt coalition, which also called on the Ismail government to update the House regularly on how revenue from the VAT is being used and its effect on inflation, Al Shorouk reports. Al Wafd, which had announced on Saturday that it was against the law, changed its mind and voted in favour, AMAY reports. A number of MPs from the 25-30 coalition walked out from the session in protest after the House voted to approve the VAT in principle, Al Masry Al Youm reports, prompting House Speaker Ali Abdel Aal to refer them to the House Disciplinary Committee. The Salafi Al Nour party also said it opposed the law on the grounds it would be inflationary.

Separate taxation legislation for SMEs unlikely to pass the House? It is unlikely that the House will approve a separate tax system for small businesses that fail to meet a minimum income threshold, said MP Ashraf Al Araby, a member of the House Economics Committee, Al Mal reports. The MP says the constitution affords the government the right to develop a separate tax system for SMEs without enacting new legislation.

Egypt bans wheat shipments contaminated with ergot — again. You are hereby forgiven for thinking you’re living in Groundhog Day. The zero-tolerance policy, which will ban “even trace levels of ergot,” was imposed by the Agriculture Ministry, according to Reuters. Better still: It apparently applies retroactively, highlighting one of many reasons why we rank 131 out of 189 countries on the ease of doing business index. “The ban will be applied to every grain of wheat entering the country. As of now no infected wheat will enter either from upcoming tenders or previous ones,” ministry spokesperson Eid Hawash said. “This will dramatically impact the market … Traders will now, if they decided to take the risk and participate in GASC tenders, charge much higher prices to cover the huge risk involving selling to Egypt,” Hesham Soliman, president of Alexandria-based Medstar for Trading, told Bloomberg. The decision to enforce the ban reverses a decree that had allowed for up to 0.05% ergot in wheat shipments, the international standard in line with the UN FAO’s Codex Alimentarius.

The decision was taken based on a three-week study conducted by the Agriculture Research Center, which concluded ergot could mutate and spread, potentially endangering plants and humans, said Ahmed Aboul Yazeed, head of the Agriculture Ministry’s Agricultural Services Department at a press conference on Sunday, Al Borsa reports. The Agriculture Ministry previously said studies showed ergot did not threaten the local crop, but that the ministry would amend its decision should “future studies appear that show an effect.” Sources are saying the minister of agriculture is trying to abide strictly to the letter of the law, fearing a fate similar to that of Supply Minister Khaled Hanafy, according to Al Mal.

Was the PM sandbagged on the decision? An agriculture ministry official claims Prime Minister Sherif Ismail was consulted on the decision. “The decision was taken in coordination with the prime minister,” Ahmed Aboul Yazeed said at the conference, Reuters reported. However, Al Shorouk is reporting that Fayed’s decision surprised Ismail, who had previously pushed for Egypt to follow UN FAO standards. The PM has reportedly responded by stepping-up the search for Hanafy’s successor. The newspaper suggests that Hanafy had been a thorn in Fayed’s side on the ergot issue.

More restrictions could come? The Agriculture Research Center has reportedly compiled a list of 15 countries which it says have the highest ergot contamination risk and could back additional restrictions on imports from those countries, said Ashraf Khalil, head of Plant Pathology Research Institute, according to Al Mal. Among them are some of the world’s largest wheat producers, including the US and Canada, as well as Brazil, Germany, Uruguay, and Serbia. A list of alternatives has also been drawn up in the event a ban on shipments from these countries are enforced. Countries the center deems to be of low contamination include Russia, Ukraine, Latvia and Moldova, said Aboul Yazeed.

The House of Representatives kicked-off discussions yesterday on amendments to the Customs Act. The changes are being billed as a “cornerstone” of the government’s economic reform agenda and will impose “strict punishments” on customs evaders while reducing clearance times and fees for importers. (Yes, even in 2016, the rhetoric of punishment comes ahead of tangible benefits in the state’s selling line whenever economic policies are under consideration.) The hearing by the House Economics Committee also saw Customs Authority chief Magdy Abdel Aziz testify about current issues with the customs apparatus in the country. The authority has fallen 18% short of its revenue target for FY2015-16, which Abdel Aziz blamed on a lack of coordination between the Authority and other government agencies, Al Shorouk reports. Abdel Aziz called on the committee to swiftly adopt the new customs legislation to help it clamp down on customs evasion, alleging that 90% of import documents from China and Turkey are forged.

Saudi Telecom makes another push for 4G license at a meeting with Al Qady: Saudi Telecom CEO Khaled Biyari push CIT Minister Yasser Al Qady during a meeting yesterday to allow STC to enter the Egyptian market with a 4G license, Al Mal reports. While details on the meeting are scarce, Saudi Telecom had been one of a number of international mobile networks looking for a chance to bid on the upcoming 4G licenses. China Telecom was also said to be interested, and Kuwait’s Zain had made an official request in July to bid be allowed to bid. Al Qady told all three that domestic MNOs would be given first dibs. In what Al Masry Al Youm is billing as the last interview he gave before leaving Egypt to run Orange’s Moroccan subsidiary, outgoing Orange Egypt CEO Yves Gauthier called for more talks with the NTRA on 4G licenses in the hopes of making the terms “more economically feasible.” He said the limited frequencies don’t make the terms economically viable for at least another two years. Local MNOs have until 22 September to make up their minds about bidding for 4G licenses.

The Central Bank of Egypt is reportedly considering customs breaks and other incentives for Egyptian expats to push them away from relying on the parallel market abroad and to stimulate the flow of remittances, according to Al Masry Al Youm, which claims to cite a policy paper by the CBE. Once FX reserves pick up as a result of import-restriction policies, the CBE will be able to effectively curb the parallel market, the paper states.

Speaking of which: The EGP held its pre-weekend rate of EGP 12.70 to the USD in the parallel market on Sunday, as FX bureaus were treading lightly as a result of the CBE’s crackdown, Al Mal reports.

In other CBE news, numerous pharma producers have asked the CBE to prioritise their access to FX to redress shortages of oncology and cardiovascular treatments, Al Mal reports.

**Earnings Watch: Cleopatra Hospitals reported 2Q2016 earnings yesterday, posting net income of EGP 8.3 mn on revenues of EGP 201.7 mn, reflecting what it said were “strong operational results despite seasonal softness in the healthcare market as well as one-time impairment and provisions charges,” the company said in a regulatory filing (pdf). Revenues were up 10% year-on-year on a pro forma basis. The company’s earnings release goes into detail on the progress of its integration program and notes it locked-in savings on consumables and pharma supplies on a quarter-on-quarter basis despite the current inflationary environment. In a separate statement, Cleopatra said its board approved retaining EFG Hermes to advise on the potential acquisition of a 47% stake in Cairo Specialised Hospital, Daily News Egypt reported.

Speaking of healthcare: There is no evidence of anti-competitive practices in the healthcare industry that require intervention, Egyptian Competition Authority chief Mona El Garf told Al Mal yesterday. Even after a two-year wave M&A activity in the sector, the market is not concentrated, she added. The ECA had investigated the sector at the request of the Health Ministry, which formed a taskforce to see whether recent M&A activity had left any one player in a position to enjoy a monopoly.

A year to forget: Egypt’s tourism sector has recorded inflows of just USD 4.5 bn in FY 2015-16, Finance Minister Amr El Garhy said, according to Al Borsa. That’s less than half of the USD 9.4 bn recorded in FY 2011-12 and more than 39% off the USD 7.4 bn recorded in FY 2014-15.

Photojournalist Omar Adel has been missing since Friday, when he contacted his brother to say that he was being arrested and taken to Matariya police station, Daily News Egypt reported on Sunday. Police have denied he was being held at the station and gave no further information on his whereabouts. The Journalists Against Torture Observatory filed a complaint with the Prosecutor General’s Office and Interior Ministry. Egyptian law requires detainees to be brought before a prosecutor within 24 hours of their arrest. Fourteen detainees have reportedly died while in custody at Matariya police station over the past two years, according to the Egyptian Initiative for Personal Rights.

CORRECTION- In our story in yesterday’s issue on accusations that frozen strawberries exported from Egypt were responsible for an outbreak of hepatitis A in Virginia that has so far resulted in 28 cases as of Thursday, we repeated Food Safety News’ erroneous claim that Egypt exports 40 mn tonnes of strawberries per year. According to the most recently available data from the Food and Agriculture Organization of the United Nations, Egypt produced 422k tonnes of strawberries in 2013. We regret the error. H/t Mohamed M.

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Egypt in the News

Guess what everyone — Breitbart News operates from a building in DC owned and rented out by an Egyptian: Stephen Bannon, Donald Trump’s campaign CEO and executive chairman of far-right media news website Breitbart, is known to stay at the so-called “Breitbart embassy”: “a luxurious [USD 2.4 mn] townhouse beside the US Supreme Court in Washington, DC, where his website’s staff work from basement offices.” The building is owned by Egyptian member of parliament Mostafa El Gindy, The Guardian says. The piece is originally about how Bannon is registered to vote in Florida at a vacant house at which he does not live. The geniuses at Al Arabiya reframed the whole story to write that “Donald Trump has chosen El Gindy’s house as his campaign headquarters.” El Gindy had to clarify, issuing a statement that the house was rented out by his tourism company to Bannon’s Breitbart News and has nothing to do with Trump’s campaign. As noted in the aforementioned Guardian piece, “Gindy has received favorable coverage from Breitbart News, which styles him as a ‘senior statesman,’ without an accompanying disclosure that he is the website’s landlord.” If any of our readers are unfamiliar with Breitbart’s owner Bannon, see Mother Jones’ article ‘How Donald Trump’s New Campaign Chief Created an Online Haven for White Nationalists,’ which notes that Bannon more or less “endorsed House Speaker Paul Ryan’s primary challenger, businessman Paul Nehlen, who floated the idea of deporting all Muslims from the United States.”

My summer vacation in Sahel, by Mona Eltahawy: Mona Eltahawy writes an op-ed for the New York Times that we can back. You don’t have to read the whole thing: The gist of it is that Egypt’s beaches on its North Coast are tolerant of whatever women want to wear — bikinis, burkinis and one-pieces — at the same time as the issue has turned into an existential crisis in Europe. The idea that a Muslim country could reflect and tolerate a variety of modes of self-expression in what women choose to wear in public (be it niqab, hijab or no hair covering) is a basic fact of which a good number of individuals in the West seem to be completely unaware — and one imagines that if one tried to explain that fact, one would receive a silent stare in response that could be interpreted to mean that you misspoke, or they misheard, or that if they keep staring silently the moment will just pass.

Taking pictures of tourist attractions in Egypt — 170 years ago: The Daily Mail reports on a rare collection of nineteenth-century photographs that captured Ancient Egyptian artifacts from 1849 to 1851. The black-and-white images were captured by French photographer Maxime Du Camp on a government-backed expedition where he was joined by renowned novelist Gustave Flaubert. The set is part of a wider volume Du Camp released called Égyptie, Nubie, Palestine et Syrie. The collection is currently on sale.

On Deadline

Al Ahram Columnist Makram Mohamed Ahmed says former Supply Minister Khaled Hanafy’s resignation raises more questions than it answers. Hanafy should have been able to present his case to the House of Representatives, he says, explaining that without transparency on whether there was corruption and why it is being swept under the rug, the people become wary of the whole government.

Worth Reading

More on Russia’s disinformation campaigns as part of its military doctrine: Following up on the 2015 piece by Adrian Chen we posted earlier this month on the Kremlin’s paid internet troll farms, Neil MacFarquhar details for the New York Times how Russia used a disinformation campaign through traditional and social media to attempt to influence political opinion in Sweden against joining NATO. “The planting of false stories is nothing new; the Soviet Union devoted considerable resources to that during the ideological battles of the Cold War. Now, though, disinformation is regarded as an important aspect of Russian military doctrine, and it is being directed at political debates in target countries with far greater sophistication and volume than in the past. (Read A powerful Russian weapon: The spread of false stories)

Image of the Day

Cabinet approves handing over part of Petrified Forest Protectorate for private housing development: The Cabinet approved on Sunday a decision to establish an EGP 3 bn housing project on part of the land of the Petrified Forest Protectorate outside of Maadi, Al Borsa reported. The environment of the area has already suffered from nearby construction, and Borsa notes that the Ministry of Housing had so far been prevented from pursuing development on the protectorate from the Ministry of Environment since at least 2014. Some smaller sized photos of the area may be viewed from the Ask Aladdin site, which sagely notes that from the perspective of a “non geologist or a person who is not a nature lover, there is nothing much to see in the reserve accept [sic] stones, sands and rocks.” (View images of the Petrified Forest Protectorate)

Worth Watching

Thor explains where he was during Captain America: Civil War. (Watch, running time: 3:31)

Diplomacy + Foreign Trade

The African Export–Import Bank (Afreximbank) is considering providing up to a total of USD 5 mn in trade finance to Egyptian manufacturers, Chairman Benedict Oramah told Al Ahram. The line of credit provided will be the first agreement of the kind that Afreximbank approve for Egyptian companies since 2012. It is not clear if the trade finance facilities will just be restricted to companies trading with African counterparts or will include other international players as well.

Mitsubishi Heavy Industries (MHI) is looking for business in Egypt’s steel sector, pitching Japanese technology for upgrades during a meeting with GAFI Chairman Mohamed Khodeir, Al Mal reported. Also, Masahiro Kuwahara, the Bank of Tokyo-Mitsubishi UFJ’s chief executive for EMEA, pledged support to Japanese companies looking to invest in Egypt. Mitsubishi Heavy Industries is also looking to provide technical training to public companies, Public Enterprise Minister Ashraf El Sharkawy told Al Masry Al Youm.

Jordan and Egypt are expected to ink agreements in education, taxes, mineral resources, aviation and social development during the 26th Egyptian-Jordanian Commission meetings on Wednesday, said International Cooperation Minister Sahar Nasr, according to Al Ahram. Topping the agenda at the meeting will be a discussion on trade barrier reductions for Egyptian agricultural goods into Jordan.

President Abdelfattah El Sisi, Foreign Minister Sameh Shoukry, and intelligence chief Khaled Fawzy met with a delegation from the US Business Executives for National Security (BENS), a US non-profit in the defense industry. The meeting discussed regional developments in general, including Palestinian-Israeli relations, according to Al Masry Al Youm. Both parties also discussed bilateral relations, according to Ittihadiya spokesperson Alaa Youssef. BENS’ Founding Chairman Stanley Weiss, who hails from the mining industry, authored an op-ed in 2015 in support of El Sisi’s government in which, among other things, he was critical of the US State Department’s meeting with members of the Muslim Brotherhood in the same year. BENS previously sent a delegation to Egypt last year. The organization focuses on evolving threats, which include energy and fragile states, along with increasing the US military’s efficiencies and operational effectiveness.

Slovak minister seeks Egypt support in UN bid: Slovakia’s Foreign Minister Miroslav Lajčák arrived in Cairo on Saturday to meet with Foreign Minister Sameh Shoukry, Ahram Online reports. Lajčák is seeking support in his bid as the UN’s next secretary general.

Energy

British bank to finance 85% of Adenium-Triangle consortium solar power plant in Aswan

The Adenium-Triangle consortium will sign a final agreement with a British bank to finance 85% of a solar power plant in Aswan under the first phase of the feed-in tariff projects within two weeks, Triangle finance boss Mohamed Ali told Al Borsa. The move would make Adenium-Triangle one of the few companies to close on a phase one project under the feed-in tariff program. The bank has no issue with domestic arbitration, Ali says, adding the group is hoping to sign its energy purchase agreement with the Egyptian Electricity Transmission Company by October. The 50 MW plant has an investment cost of USD 100 mn. Adenium Energy is the first company since KarmSolar to announce it will continue a phase one project.

Eni raises expected output from Nooros field to 1 bcf/d starting 2017

Eni has raised its projected output from the Nooros field to an expected production of 1 bcf/d starting 2017, sources told Al Borsa. Eni had previously announced it was targeting 700 mcf/d by September from the field. Nooros currently produces 350 mcf/d after four of the development wells went into production at an investment cost of USD 450 mn, the source added.

IOCs owed USD 3.4 bn by FY2015-16’s end, installment to be made in 4Q2016

Egypt is committed to back dues owed to international oil companies, Oil Minister Tarek El Molla said, according to Al Masry Al Youm. The country paid for its energy supplies from IOC partners in full last year, El Molla noted, paying USD 5.4 mn and brought the amount owed to IOCs down by another USD 100 mn. El Molla says Egypt now owes USD 3.4 bn to IOCs, compared to the USD 6.3 bn owed to them by the end of 2013. Egypt is also gearing up to make payments in 4Q2016, El Molla added. Payments aside, El Molla also said that a number of IOCs have continued to position Egypt as an integral part of the production profiles, pointing specifically to Eni and BP and adding that this is on display in the tangible number of new discoveries being made.

Dana Gas looking to restructure debt part of USD 700 mn sukuk

Dana Gas may look to roll over some of its USD 700 mn Islamic bonds maturing next year, CEO Patrick Allman-Ward told Bloomberg. “We are looking at different ways in which we can go forward and structure our debt,” Allman-Ward said. “Clearly part of that is going to involve buying back a lot of the sukuk and part of that is going to have to be a discussion around rolling over the remaining amount in future.”

Basic Materials + Commodities

66.6% decline in cotton exports this season

Cotton export contracts have declined 66.6% this season, with 33,100 tonnes of cotton slated for export, said the head of the Cotton Exports Association, according to Al Mal. The value of these contracts has also decreased by 28.3%, reaching USD 86 mn this season.

Real Estate + Housing

Qatari Diar still denied access to Red Sea plot

Real estate developer Qatari Diar has not received its land plot by the Red Sea allocated for a 29 mn sqm development project, Al Mal reported. “Higher authorities” are blocking the land delivery, sources said. Qatari Diar had threatened to file an arbitration case against Egypt in May after reports that another Egyptian state agency laid claim to 2 mn sqm of the project and demanded the company pay for that land at a higher rate than agreed upon with the Tourism Development Authority back in 2006. A month later, there were reports that an agreement was expected to be reached. Qatari Diar had said on Thursday it was no longer in control over the land allocated for its City Gate project in New Cairo.

Automotive + Transportation

Transport Minister denies Cairo Metro ticket price increases

Transport Minister Galal Saeed denied news reports circulating yesterday that metro ticket prices will increase by September, according to Al Masry Al Youm. Saeed also denied that certain metro cars will be priced differently. He added that the timeline for the price increases remains unconfirmed.

Armed Forces Armaments Authority contracts biometric devices for Egyptian Holding Company for Airports

The Armed Forces Armaments Authority has entered negotiations to supply the Egyptian Holding Company for Airports and Air Navigation (EHCAAN) with biometric devices, Daily News Egypt reported. Implementing the biometric devices, which will facilitate the entry and exit of airport employees, is a condition of resuming Russian flights to Egypt, Chairman of EHCAAN Ismail Aboul Ezz said, and as we noted earlier this month. Among other requirements were the installation of land surveillance radar cameras, which cost EGP 45 mn in Sharm El Sheikh, and EGP 90 mn in Cairo Airport.

Ousta sells minority stake for EGP 11 mn in funding

Car-hailing app Ousta has closed an EGP 11 mn (USD 1.25 mn) funding round backed by Egyptian and UAE-based venture capital outfits, said co-founder Nader El Batrawy, Al Mal reported on Sunday. El Batrawy says the company plans to tap capital once more as it looks to grow its fleet to 10k vehicles from its current 4k. Last month, we had noted that Ousta was offering a non-controlling stake in the company for EGP 50 mn, with Beltone Financial acting as an advisor.

Banking + Finance

Heliopolis Housing and Development negotiates for EGP 350 mn loan

Heliopolis Housing and Development is seeking EGP 350 mn in financing to build water and electricity infrastructure at an unnamed development, Al Mal said. The company is in talks with banks on the facility now.

Other Business News of Note

Raya to buy 19.39% in Polish pasta producer

Raya Holding announced it has signed a preliminary agreement to acquire 19.39% of Polish food producer Makarony Polskie. Raya is buying the stake through the acquisition of Madova, which owns the stake in Makarony Polskie. The acquisition is estimated to cost around EGP 38 mn, but the exact figure will be known once a final agreement is reached, according to a bourse statement. Raya’s plans in Poland were first announced in June.

Egypt Politics + Economics

Egypt increases prison terms for FGM, Stanford study says doctors are undermining gov’t anti-FGM campaign

The cabinet has approved a bill that increases prison terms to 5-7 years for individuals convicted of having performed FGM procedures; anyone who accompanies an FGM victim to the procedure would face a 1-3 year sentence, Ahram Online reported. The problem in Egypt runs deeper, as an assessment by researcher Amel Fahmy that we’ve covered previously suggested that harsher prison penalties are unlikely to reduce instances of FGM, making a similar case by quoting a doctor and parliamentarian who said “leaving women uncircumcised is unhealthy.” This was echoed similarly when a majority of women surveyed in a recently released Stanford study said that when they sought advice on FGM from physicians, they did not get an explicit rejection about having the procedure done. The study notes that “in nearly all cases, doctors did not explicitly reject the idea, but gave the women vague answers about the possible ‘need for the procedure.’”

Construction of Churches Act stalls in House Legislative Committee

A contentious debate over a draft law governing construction of churches, which would make the size of a church allowed in any one district a function of the size of the area’s Christian population, has caused the legislation to stall in the House Legislative Committee, AMAY reports.

On Your Way Out

Egyptian MP claims Greek island is actually Egyptian, island sets itself ablaze: The House of Representatives continues to focus on the most pressing issues facing the country, as Egyptian MP Haytham El Hariri has asked the Egyptian government to clarify “reports” that the island of Chios is actually Egyptian and that the government had ceded it to Greece in a demarcation agreement, according to Al Mal. Hani Berzi, the Edita boss and head of the Egypt-Greece Business Council, asked parliament to refrain from such “nonsense.” Separately, a major fire broke out on the island of Chios on Friday, destroying a forested area and injuring six people.

Sheikh Mo makes surprise visit to government offices, finds them empty: UAE Prime Minister and Ruler of Dubai Sheikh Mohammed bin Rashid Al Maktoum made a number of surprise visits to UAE government offices on Sunday morning, Bloomberg reported, only to find empty offices. The Dubai Media Office posted some of the videos online here and here. “Timeliness starts at the top and we won’t go after employees when their bosses aren’t there,” Director-General of the media office Mona Al Marri told Bloomberg.

The markets yesterday

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USD CBE auction (Tuesday, 23 Aug): 8.78 (unchanged since Wednesday, 16 March)
USD parallel market (Sunday, 28 Aug): 12.70 sell and 12.50 buy (unchanged since Thursday, 25 Aug, Al Mal)

EGX30 (Sunday): 8,052.2 (-1.0%)
Turnover: EGP 259.1 mn (40% below the 90-day average)
EGX 30 year-to-date: +14.9%

THE MARKET ON SUNDAY: EGX30 fell 1.0%. The top gainers were Egyptian Resorts, Emaar Misr, and CIB. The worst performers were TMGH, OTMT, and Amer Group. At a market turnover of EGP 259.1 mn, foreign investors were the sole net sellers.

Foreigners: Net short | EGP – 36.0 mn
Regional: Net long | EGP + 5.2 mn
Domestic: Net long | EGP + 30.8 mn

Retail: 72.5% of total trades | 74.7% of buyers | 70.2% of sellers
Institutions: 27.5% of total trades | 25.3% of buyers | 29.8% of sellers

Foreign: 14.0% of total | 7.0% of buyers | 20.9% of sellers
Regional: 4.0% of total | 5.0% of buyers | 3.0% of sellers
Domestic: 82.0% of total | 88.0% of buyers | 76.1% of sellers

WTI: USD 47.10 (-1.19%)
Brent: USD 49.92 (+0.00%)
Natural Gas (Nymex, futures prices) USD 2.85 MMBtu, (-0.70%, Sep 2016 contract)
Gold: USD 1,319.50 / troy ounce (-0.48%)

TASI: 6,071.4 (+1.6%) (YTD: -12.2%)
ADX: 4,499.7 (-0.4%) (YTD: 4.5%)
DFM: 3,490.3 (-0.1%) (YTD: 10.8%)
KSE Weighted Index: 346.4 (-0.6%) (YTD: -9.2%)
QE: 11,197.5 (+0.6%) (YTD: +7.4%)
MSM: 5,809.3 (-0.2%) (YTD: +7.5%)
BB: 1,139.3 (-0.6%) (YTD: -6.3%)

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Calendar

29 August (Monday): The House of Representatives will discuss the fact-finding report on wheat purchases. 29-31 August (Monday-Wednesday): Egyptian-Jordanian Commission meeting 29-30 August (Monday-Tuesday): Wastewater Egypt conference. 01 September (Monday): President Abdel Fattah El Sisi is expected to be in India on a state visit en route to the G20 summit in China. 04 September (Sunday): Arab Trade & Supply Chain Finance Conference. 04-05 September (Sunday-Monday): President Abdel Fattah El Sisi is expected to be in China for a state visit coinciding with the G20 summit. 05-08 September (Monday-Thursday): The 6th EFG Hermes London MENA and Frontier Conference, Emirates Arsenal Stadium, London, UK. 05 September (Monday): Markit Emirates NBD PMIs out for Egypt, Saudi Arabia, UAE at 6:15am CLT. 06-08 September (Tuesday-Thursday): Citi’s 2016 Global Technologies Conference, New York. 11-13 September (Sunday-Tuesday): Eid El Adha (national holiday, tentative date). 14-16 September (Wednesday-Friday): Bank of America Merrill Lynch Global Healthcare Conference 2016, London, UK. 19-20 September (Monday-Tuesday): Euromoney Egypt conference, venue TBD. 19-20 September (Monday-Tuesday): Arqaam Capital MENA Investors Conference 2016, Park Hyatt Dubai, UAE. 19-21 September (Monday-Wednesday): Bank of America Merrill Lynch Global Consumer and Retail Conference 2016, London, UK. 22 September (Thursday): Central Bank of Egypt’s Monetary Policy Committee meets to review rates. 22 September (Thursday): Deadline for mobile network operators to accept the final terms for 4G mobile broadband network licenses. 27-29 September (Tuesday-Thursday): Citi’s Frontier Markets Symposium – London 2016, UK. 02 October (Sunday): Islamic New Year (national holiday, tentative date). 06 October (Thursday): Armed Forces Day (national holiday). 11 October (Tuesday): 2nd Annual Leasing Conference entitled “New insights to stimulate financing instruments”, Four Seasons Nile Plaza Hotel, Plaza Ballroom, Cairo. 11-12 October (Tuesday-Wednesday): Global Islamic Economy Summit, Madinat Jumeirah, Dubai. 26-27 October (Wednesday-Thursday): The Marketing Kingdom Cairo 2 event, Cairo. November (TBD): Delegation of German companies in the renewable energy sector due to visit to discuss investment opportunities. 14-16 November (Monday-Wednesday): Bank of America Merrill Lynch MENA 2016 Conference, The Ritz Carlton, Dubai International Financial Centre, 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. 29-30 November (Tuesday-Wednesday): Citi’s Global Consumer Conference, London, UK. 04-06 December (Sunday-Tuesday): Solar-Tec exhibition, Cairo International Convention Centre. 04-06 December (Sunday-Tuesday): Electricx exhibition, Cairo International Convention Centre. 07-08 December: Citi’s 2016 Global Healthcare Conference, London, UK. 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. 13 December (Tuesday): Amwal Al Ghad’s top 50 most influential women in Egypt women forum, Four Seasons Nile Plaza Hotel, Cairo. 29 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee meets to review rates.

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