House deadlocks with cabinet on free zones, foreign labor caps as Investment Act edges toward a final vote

We got a step closer to a new Investment Act yesterday (more on that in Speed Round, below) after a late afternoon session of the House of Representatives approved almost all of the bill’s 92 articles. A final vote on the floor of the House could take place today if MPs and the government can iron out what they want to do with private-sector free zones, which were the topic of bid yesterday evening to reach consensus (or, reading between the lines, prompt the House Economics Committee to drop what media reports suggest is its insistence on allowing the privately-owned zones). Once the act is passed, attention will turn to the executive regulations, on which Investment Minister Sahar Nasr has already begun work with a view to releasing them as soon as possible after the bill becomes a law.

It’s PMI day: The Markit / Emirates NBD purchasing managers’ indexes for Egypt, the UAE and Saudi Arabia will be out this morning at 6:15am CLT, not long after we hit “send” on this issue. Tap here to visit the PMI releases page and download the version of your choice.

President Abdel Fattah El Sisi is the UAE today on a two-day visit “for wide-ranging talks,” according to Ahram Online. There were no details provided on the visit except that it comes in the context of "the solid brotherly relations between Egypt and the UAE, stressing interest on both sides in ongoing coordination regarding the challenges that the Arab nation is facing, and to consolidate Arab cooperation and protect Arab national security," the newspaper quotes a dispatch from the state-run MENA news agency as saying.

El Sisi arrives in the UAE one day after Libyan rivals sat down with UAE officials in Abu Dhabi for reconciliation talks. Libyan national army chief Gen. Haftar Khalifa (who has backing from Egypt and the UAE) and UN-backed Libyan Prime Minister Fayez Al Sarraj met for direct talks on how to end the conflict brokered by Abu Dhabi Crown Prince Mohammed bin Zayed Al Nahyan, the UAE’s The National reports.

The House Budget Committee will discuss the FY2017-18 budget on Monday, 8 May and not this week, according to Deputy Finance Minister Mohamed Maait. MPs reportedly postponed the scheduled discussion at the request of the finance and planning ministers, who are meant to attend the sessions, but will be tied up with the IMF delegation here in Cairo until 11 May assessing Egypt’s progress on economic reform, unnamed MPs tell Al Borsa.

Car importers reached for the nuclear option yesterday in their war against the proposed automotive directive — and in doing so, made for the most dramatic viewing last night. Lamees El Hadidy made hay out of an Al Watan newspaper report on an MP’s allegation that high-profile business leader Raouf Ghabbour had offered the House of Representatives microbuses worth EGP 650k. The piece not so subtly suggests that Ghabbour made the alleged offer of a donation to push forward the directive, which would give incentives to car assemblers who go further up the value chain into manufacturing and thereby protect them against unfair advantages enjoyed by European Union, Turkish and Moroccan imports. The measure has broad backing from automotive assemblers (read: the people who create industrial jobs) and is almost universally reviled by pure importers.

The allegation was made by MP Mohammed Zein, a member of the House Transport Committee, who said he has submitted a formal request for an inquiry into the matter. Lamees was oddly spineless over the entire affair (watch, runtime 7:16), saying only that the House should never accept gifts that would raise questions about conflicts of interest.

As we noted yesterday, importers threatened by the prospect of the automotive directive — which the Ismail government sees as a clear pro-jobs move that would help deepen Egypt’s industrial base — have arranged a drumbeat of coverage in the domestic press attacking the proposed measure, which remains in committee.

Al Hadidi then moved on to talk about what she characterized as a persistent shortage in meds in the market, saying the need for national health insurance is becoming more pressing and might just be the only way to improve citizens’ access to needed pharma products (watch, runtime 19:34).

Al Hayah Al Youm’s Lobna Asal discussed the proposed Investment Act with House Economics Committee Deputy Chair Amr El Gohary, who said he expects discussion to wrap up within a couple of days. Other than the issue of establishing private free zones (we have more on that in Speed Round), a point of contention with the government, MPs are also still undecided about the ceiling foreign labor at any one company. El Gohary said he would personally prefer it to be brought down to 10% from a current 20% (watch, runtime 8:00).

Asal then moved on to a follow-up on the ongoing domestic wheat harvest. Supply Ministry Spokesperson Mamdouh Ramadan said that the ministry sources a daily 70k tonnes from farmers and extended working hours to be able to keep up (watch, runtime 3:31).

Over on Kol Youm, Amr Adib spoke to Endowment Minister Mohamed Mokhtar Gomaa about the ministry’s newest book, which is yet to hit the shelves and is meant to shed light on the myths and mysteries of terrorism, which are used by terrorist groups recruit new followers (watch, runtime 12:14).

On Yahduth fi Masr, Sherif Amer hosted Interior Ministry Spokesperson Hany Abdel Latif for the night to chat about security. Abdel Latif said that authorities have found evidence that ousted Islamist president Mohammed Morsi was in touch with terrorist groups in Sinai during his time in office.

The House has approved the Investment Act in principle, but postponed its final vote to today until issues over private free zones are put to rest. The House of Representatives is expected to vote on the Investment Act in a plenary session today after MPs gave a preliminary nod to 90 of its 92 articles during a general assembly session late yesterday afternoon, Al Mal says.

Why didn’t it pass last night? The final vote was postponed until members of the Economic Committee can resolve disagreements with the finance and investment ministries over articles relating to the return of private free zones. The Finance Ministry rejected the committee’s move on Sunday to re-introduce private free zones under the new act, which broke the committee’s agreement with the ministry, high-ranking officials alleged in a talk with Al Mal. While private free zones continue to exist, the establishment of new ones had been banned in 2015.

Abdel Aal brokering a compromise? House Speaker Ali Abdel Aal reportedly met with Investment Minister Sahar Nasr, Finance Minister Amr El Garhy and Deputy Finance Minister Amr El Monayer after yesterday’s session in a bid to diffuse the issue, urging MPs on the Economics Committee to do the same. The issue: The Economics Committee still wants to give the green light to private free zones despite the Finance Ministry’s objections, deputy chair Amr El Gohary tells Al Mal. Speaking during Tuesday’s assembly, Nasr said that the government and representatives will work to push the act out as quickly as possible.

No nationalization: Among the articles approved on Tuesday by the House were those that prohibit the nationalization of private investments and projects.

Egypt has clear potential to become an energy trading and export hub, notably for natural gas, according to a report by BNP Paribas (pdf) that suggests Egypt’s bid to transform itself into a hub will depend on the country’s capacity to mitigate geopolitical, financial, and regulatory risks.

BNP Paribas says “Egypt’s bid to become a regional energy hub is built on three pillars: strategic location on key trade routes, proximity to resource-rich countries with relatively saturated domestic markets, and advanced export infrastructure. This last factor, in our view, is the defining pillar of Egypt’s regional hub strategy.”

The hub would include trading and export activities: “The trading dimension positions Egypt as a deep and open gas market where sellers and buyers transact freely under efficient regulatory conditions… The second dimension positions Egypt as a gas export hub not only for its own surplus domestic production, but also for the excess output of other East Med basin countries… Egypt’s existing LNG terminals on the two flanks of Nile Delta seem to be the answer to the East Med gas surplus question.”

The bank sees three constraints on the development of the Egyptian gas hub. First is the geopolitical sensitivity between Egypt and Israel on the one hand and Cyprus and Turkey on the other, which could derail development. The second constraint is the limited financial capacity to invest in a regional hub strategy, that would require changes in EGPC and regional cooperation and a willingness to pay for subsea pipelines that require large capex outlays. A third constraint to regional energy integration is regulatory uncertainty in host countries as, unlike the stable regulatory regime in Egypt, “upstream regulation has proved to be cumbersome in Israel and, at least, untested in Cyprus.”

The IMF’s Regional Economic Outlook report came out yesterday and was broadly in line with expectations. The Fund says “a more favorable global environment is helping to improve economic prospects in the Middle East, North Africa, Afghanistan, and Pakistan (MENAP), although growth prospects remain subdued. To improve growth and boost living standards, countries in the MENAP region face an ongoing need to enact strong and lasting structural reforms, while consolidating their fiscal positions.”

On Egypt, specifically, the IMF says inflation has been driven by exchange rate adjustment, implementation of value-added tax, reduction of energy subsidies, and increases in food prices. “As the impact of these one-off factors fades over time, and supported by prudent fiscal and monetary policy, inflation is expected to moderate over the medium term,” the fund says. The IMF also suggests that tighter monetary policy could weigh on lending growth in 2017. For the banking and finance sector, it suggests that Egypt should be one of the MENAP countries that need to strengthen “their insolvency and bankruptcy regimes; and, in some cases, their deposit insurance arrangements.”

Debt levels remain high in Egypt, the report notes, with significant debt-service burdens, but the recent fiscal trends are “encouraging,” even though there is “a need to push subsidy reforms through to completion.” Along with the potential for slower reforms, policy implementation could be derailed and economic activity weakened with a worsening of security conditions or social tensions.

The IMF still expects external imbalances will remain sizable in countries including Egypt, suggesting a continuing need for fresh external inflows. While there are still some downside risks to oil price increases for oil-importing countries including Egypt, the “risk would be partly offset by higher remittances and other foreign support from oil-exporting countries in the region.”

One clear recommendation the IMF made to Egypt, Jordan, and Morocco is the need to support “efforts to increase female labor force participation” in order to combat persistently high unemployment rates. Download the full report here (pdf) or visit the landing page for additional goodies.

There are three key takeaways from the Egypt Investor Conference in Cape Town last week, Renaissance Capital says. Corporates have welcomed the float of the EGP despite its negative short-term impact on volumes and margins; wages have been adjusted equitably;and “energy subsidy reform is under way, gas supply is improving for industrials, and the Zohr gas field appears to be on track for year-end production.”

RenCap’s chief economist Charles Robertson “sees several reasons why Egyptshould be on top of investors’ agenda. The [EGP] is the cheapest in EM and Africa. There is an already demonstrated commitment to tough fiscal reform, such as energy subsidy removal, with external backing from the IMF. A decade of bank deleveraging means Egypt has huge potential for credit growth. High interest rates are attracting portfolio inflows, and he sees room for credit rating upgrades from 2H17 or beyond. Finally, Charles believes Egypt is relatively insulated from a US recession or a US-China trade war, and that political risks are priced in to FX and bonds.”

Investors aren’t the only ones who like the float of the EGP: The central bank announced yesterday that Egyptians living abroad have sent home 13.8% in remittances since the float of the EGP, Reuters reports. Remittances increased to USD 8 bn in the five month-period since the float, compared to USD 7 bn in the same period a year earlier.

Dispatch from DC: Enterprise attended a meeting at the Tahrir Institute for Middle East Policy in Washington, DC. The get-together for members of the media took place on the sidelines of AmCham’s annual Doorknock mission to DC, which runs through Friday. Research Director Allison McManus and Advocacy and External Relations Manager Amr Kotb spoke about the Egypt-U.S. relations. Key takeaways from the discussion:

• Gesture of goodwill: The warm welcome accorded President Abdel Fattah El Sisi during his recent visit to the United States was a gesture of goodwill, but has yet to result in a significant shift in policy or in concrete follow-ups.
• Economic aid is easing because Egypt isn’t using it: Economic aid to Egypt (ie: non-military assistance) has eased to USD 112 mn from a previous USD 150 mn not as a punitive action, but because Egypt hasn’t been allowing the deployment of US funding, especially following the effective “ criminalization” of foreign funding for civil society. (Separately, we remind readers that a leaked budget document suggests non-military aid to Egypt could fall to USD 75 mn from an on-the-books USD 142.7 mn under the Trump administration’s plan to cut spending on foreign aid.)
• The Congress’s views on reviewing assistance to Egypt are only a reflection of domestic policies. The Congress wants to take a more active role, especially given that President Donald Trump comes from outside the establishment.

Automotive sales fell 46.5% year-on-year in 1Q2017 to 26.5k vehicles, down from 49.6k during the same period in 2016, according to the latest report from the Automotive Information Council (AMIC), an industry body, picked up by Al Borsa. According to the report, sales of locally assembled vehicles were down nearly 46% year on year, while 47% fewer fully imported vehicles were sold. Passenger car sales declined 40% to 19,700 vehicles sold, down from 33,400 in the same period last year. Bus sales dropped nearly 55% y-o-y, with 2,955 units sold, down from 6,529, while truck sales for the period declined 60% to 3,888 from 9,735.

CI Capital’s new board of directors will meet on Thursday, 11 May for the first time since CIB sold a majority stake to a consortium of investors, Deputy Chairman and CEO Mahmoud Attallah told Youm7. Arafa Group boss Alaa Arafa, real estate developer Mahmoud El Gammal, businessman Ayman Mamdouh Abbas, and Zahran’s Group Karim Zahran and CIB’s Amr El Ganainy will be taking seats around the table and are reportedly set to name three new independent members to the board. CIB had successfully completed the sale of 74.75% of CI to a consortium of investors last March. Arafa, El Gammal, and Habitat Furniture owner Ismail El Turk are the anchor investors in the transaction, taking stakes of 9.9% each.

M&A WATCH- Morocco’s Attijariwafa Bank completed its acquisition of 100% of Barclays Bank Egypt yesterday for c. USD 495 mn, according to an EGX release (tap here for the pdf). The nearly EGP 9 bn transaction took place over the counter following approval from the central bank, Al Masry Al Youm reports.

EARNINGS WATCH- Juhayna reported a 28% y-o-y drop in its net income in 1Q2017 to EGP 58 mn, according to its earnings release. Revenues for the quarter were up 17% y-o-y, registering EGP 1.29 bn. Juhayna says “the highest contributor to the top-line in 1Q2017 remained to be the dairy segment at 48%, with the yogurt and juice segments coming in second and third, representing 20% and 19% of consolidated revenues, respectively. Revenue growth during the quarter was largely driven by price increases applied gradually throughout the previous quarters.”

Seven of 10 top global squash players are Egyptian: Egyptian squash players are sitting pretty at the top of this month’s global rankings. Karim Abdel Gawad is ranked as world number one in this month’s PSA world rankings, marking the first time for the player to crack into the top spot. Six other Egyptians are in the top 10 globally. Nour El Sherbini also maintained her position at the top of the women’s ranking.

A handful of international stories worth a note this morning if you have a moment:

Front page news in the global business press this morning: Apple has postedimprovements in revenues and net profits, but analysts zeroed in on a 1% slide in iPhone sales that briefly sent shares down. Apple chief Tim Cook blamed the slowdown in iPhone sales on leaks of what might come with the tenth-anniversary iPhone 8 this fall. See more in the Financial Times, Reuters, Bloomberg or the Wall Street Journal. Geeks can check out Apple Insider’s summary of the results and of Apple’s analyst call or head over to see Apple’s earnings press release.

Yes, yes, Hamas has “moderated” its tone. Yesterday, we noted that Hamas had issued a ‘moderate’ policy paper in Qatar (where else?) in which the group distanced itself from the Ikhwan and stopped just short of calling for the destruction of Israel. The Western press is now slobbering all over itself to make something out of the newly “moderate” Hamas, noting that its conversion on the road to Damascus comes just days before Palestinian leader Mahmoud Abbas heads to Washington, DC, to meet US President Donald Trump. See examples in the Financial Times (which suggests economic pressure from Egypt has helped bring Hamas to its knees), the New York Times (ditto, noting that this is Hamas boss Khaled Meshal’s “last hand”), and the Wall Street Journal (which caps its piece with a quote from an Israeli official calling Hamas’ new tone “chatter and nothing more”).

Olayan Financing Co. has hired Saudi Fransi Capital to advise on a potential IPO ofsome of its assets, ahead of which the family-owned conglomerate will reportedly “set up a new holding company for as many as 20 of its units, which could be worth as much USD 5 bn.”

CORRECTION- Egyptian Electricity Holding Company (EEHC) Chairman Gaber El Dessouki is in Riyadh to discuss the interconnection project between Egypt and Saudi Arabia. We mentioned incorrectly yesterday that El Dessouki was the head of the EETC. The entry has been corrected on our website. H/t Karim W.

Today’s Egypt Holiday Photo of the Day is of the Fetnas lake in Siwa. Cleopatra is believed to have visited Siwa to consult with Greek oracle Jupiter Amun and bathe in the spring, which is now named after her. The image was shot for CIB’s 2016 Annual Report (microsite and print edition) by Zeina Abaza at Inktank Communications, which has produced the bank’s annual report for the past eight years.

Populism is great for stock returns, writes Bloomberg, noting that a look at “10 of the 21st century’s most recognized populist leaders shows that in the three years after their election, local equities soared an average of 155 percent in USD terms. And the rallies often continued as long as a decade after the vote.” What’s their secret? Stimulus spending that’s popular with consumers may often come back to haunt leaders down the road, but it often boosts consumer sentiment in the medium term, leading to “stronger consumer spending, which can be powerful drivers of markets,” says one buy-sider who is overweight the Philippines despite that flack its populist leader has taken for allegedly encouraging the murder of [redacted] dealers.

Also on Bloomberg yesterday: A look at why Pakistan isn’t getting much love from foreign investors despite its upgrade to MSCI Emerging Markets status at the end of this month. At the very moment the country is preparing to celebrate, “overseas money is draining away” — to the tune of USD 194 mn that’s left the equity market this year. What gives? Populism Lite isn’t doing much for sentiment here. “The exodus underscores how investors are taking cover as a graft probe surrounding Prime Minister Nawaz Sharif, a stalled privatization program and the prospect of a government spending spree in the run-up to elections in the middle of next year start to take the sheen off one of 2016’s best-performing stock markets. The KSE100 Index surged 46 percent last year, beating every one of its peers in Asia,” the news service writes.

It’s a mixed bag for Egypt in the global press this morning. Pickup of wire copy on the killing of three police officers in Cairo in a drive-by shooting was surprisingly muted. Meanwhile, mild echoes of the papal visit continue to be heard (see the New York Times’ editorial “A Humane Papal Message in Egypt,” complete with gratuitous “dictatorship” dig), but no story has yet emerged to take its place. It’s almost as if the Western press has gotten its fill (for the moment).

Without question, the most significant story out of Egypt yesterday was a Reuters piece by Ahmed Hassan and Lin Noueihed contending that Daesh affiliate Wilayit Sinai are seeking to impose religious rules in North Sinai. The investigative piece found the group “is seeking to impose its hardline interpretation of Islam on the local populace for the first time” with evidence it has “created a morality police force, known as a Hisba, to enforce strict rules against such behaviour as smoking, men shaving their beards or women exposing their faces.” Hassan and Noueihed say this is part of a development that marks a strategic change and the militants had previously focused on attacking the police, soldiers, and informants only. A security source told Reuters, however, that the militants were unable to impose themselves on society: “They come out for two minutes and film two cars and say, ‘We set up a checkpoint.’ This was all for the media, for people like you to write things that bear no relation to the reality on the ground.” One activist from Rafah says that, while the militants are not in control of the region, “they are present, they pop up like a jack-in-the-box, they kill or kidnap someone and go back into hiding.”

Elsewhere, UK tabloid the Sun reports that Egyptian officials are losing patience with theBritain’s travel ban on Sharm El Sheikh. And in a complete shocker, a UN study of 10k men in Egypt, Lebanon, Morocco and Palestine is being used to declare that “Men in the Middle East are slow to embrace gender equality.” Young men surveyed were no more “progressive … than their fathers and the older generation.” Also notable: That these four countries apparently make up “the Middle East,” likely because the odds of doing a similar survey in the GCC without being tossed in the slammer or deported is about the same as our chance of being elected Pope of Rome.

And after US President Donald Trump said nice things about the Philippines Rodrigo Duterte — accused of sanctioning the mass extrajudicial killing of [redacted] dealers — plenty of US media outlets with a liberal bent to them are wondering at why “Trump keeps praising international strongmen,” as the Washington Post puts it. Our president’s strong relationship with Trump just about inevitably comes up.

(And while you’re on the Sun’s website, check out its story on the UK dad who paid usingpennies a GBP 60 fine for taking his six-year-old out of school for a holiday in Egypt, saying, “Where is he going to learn more about the world? Sitting in a classroom in Swansea or at an Egyptian temple? He was so excited to be in Egypt and I wouldn’t have wanted to deny him that opportunity.”)
Other international coverage of Egypt worth noting in brief included:

• MEED’s Hossam Abougabal borrows heavily from a Mada Masr report by Waad Ahmed to reiterate a claim that Egypt might find itself at odds with the IMF delegation over interest rates.
• Professional diver Vitaly Bazarov filmed a giant octopus as it was attempting to steal his camera under water in the Red Sea off Dahab and the Daily Mail has the footage. “The Red Sea is one of the best places for an underwater photographer but, to get the best shots, it is important to dive alone,” Bazarov says.
• At least 15 Chinese companies held an employment fair at the Suez Canal University that attracted “several hundreds of students and graduates,” according to Xinhua.
• Pope Francis’ visit to Cairo has left a profound mark on Egyptians and was a “great success,” regional Christian leaders tell Crux.
• Comic artist Ganzeer, the “Egyptian Banksy,” is still making art after moving to the US and published his graphic novel The Solar Grid. “The politics of Ganzeer’s work are still there, they’re just changing with the times and the medium,” LA Weekly says.

Why would anybody want to buy Egyptian citizenship? A bill that proposes granting foreigners Egyptian citizenship in return for a “substantial” USD bank deposit is inherently flawed. No foreigner in their right mind would opt for buying citizenship in a third-world country rather than using the same funds to invest in something profitable, Osama Gharib says in a column for Al Masry Al Youm. Gharib points out that Western citizens enjoy better opportunities both inside and outside Egypt with their original citizenships, while citizens of other countries are less likely to even have the money necessary to acquire one of our green passports.

The “real” Upper Egypt: “The Upper Egypt portrayed in TV series and cinema is sensationalist, from the black-and-white movies that used its inhabitants as rough comic material, to the Ramadan TV shows that show it as dominated by people who live in palaces surrounded by guards,” Sohag native Ahmed Ismail writes in Mada Masr in an account translated by Mariam Aboughazi. Ismail gives an insight into what life is really like in Upper Egypt’s villages — one that is seemingly lost on those of us who dwell in the capital city.

For a sharply unbanked society, financial transactions there can get quite peculiar: “As people can buy and sell on credit, it is acceptable to buy groceries all year long and only pay with your yield when wheat is harvested. While barter is less and less common, it’s still used — eggs and wheat are accepted currencies in most villages. I have bartered two eggs for a pack of tea.”

How Helen Keller learned to communicate: As an infant, Helen Keller contracted an illness that left her both deaf and blind — and incapable of developing the language skills to communicate with the people around her. That was until one Anne Sullivan found through a long process of experimentation that she could teach Keller how to speak by allowing her to feel the vibrations on Sullivan’s throat and the movements of her mouth using her fingers. Keller later went on to be the first deafblind person to earn a university degree, in addition to publishing several written works and becoming an advocate for the deafblind community (watch, runtime 2:54).

Doing more with Belarus? Federation of Egyptian Industries chief Mohamed Elsewedy will meet with the Belarusian Industry Minister and an accompanying business delegation on Wednesday to discuss potential investment opportunities, mainly in the fields of engineering and metal production, AMAY reports. The delegation will be in town until Friday, 5 May and is set to meet with a number of Egyptian business leaders.

Defense Minister Sedki Sobhi headed a delegation to Ivory Coast on Tuesday to attend a Community of Sahel-Saharan state ministerial meeting, where he is set to meet with a number of regional counterparts, AMAY reports.

The Egyptian and German governments will set up special task force to follow up on the status of agreements made during German Chancellor Angela Merkel’s visit to Cairo in March, Trade Minister Tarek Kabil said on Tuesday, Al Ahram reports.

Japanese conglomerates Mitsubishi and Hitachi submitted offers to the Electricity Ministry to build two EGP 9 bn 500 MW wind farms under the feed-in tariff program, Al Mal says. The companies would finance the project under a build-own-operate system.

The Egyptian Holding Company for Airports and Air Navigation plans to issue tenders to develop infrastructure for 2.8 mn sqm of the Airport City project, Civil Aviation Minister Sherif Fathy told the press yesterday, Al Borsa reports.

Egypt has bought approximately 360k tonnes of wheat from local farmers since the beginning of the harvest season as of Tuesday, Reuters reports. The figure compares to around 395.5k tonnes bought in the same period last year, the Supply Ministry says.

Investment and International Cooperation Minister Sahar Nasr has signed a JPY 10.19 bn (USD 90.8 mn) education agreement with Japan’s ambassador to Cairo to develop Egypt’s human resources, Al Mal reports. The agreement includes increasing the number of scholarships awarded to Egyptians receiving vocational training in Japan to include 2,500 people. It also include a focus on pre-university education.

Egypt’s tourism revenues reached USD 1.6 bn in 1Q2017, up from USD 1.5 bn during the same period last year, an unnamed Tourism Ministry official tells Ahram Online. According to the source, tourist arrivals during the quarter hovered around 1.7 mn, compared to 1.2 mn during the same period last year. Ukrainian tourism jumped 138% year-on-year, with some 226k visitors to Egypt during the first three months of 2017. Arrivals from Germany were up 35%, while 16% more Brits visited compared to the same period last year.

The Egyptian General Petroleum Company (EGPC) is looking to increase the value of a loan it is seeking to EGP 15 bn from an initial estimate of EGP 10 bn, Al Mal reports. EGPC was first reported to be in the market for an EGP 10 bn loan late in March to finance fuel imports. The syndicated loan is being arranged by CIB and includes a consortium of 10 banks. Sources said there will be no foreign currency tranches in the loan, which will carry a tenor of five-to-eight years, and the EGPC will source its own foreign currency to pay for the imports.

There is no tension between Cairo and Riyadh over the Tiran and Sanafir islands, and the demarcation agreement does not entail Egypt giving up any of its land, Deputy Crown Prince Mohamed bin Salman said yesterday in an interview with a Saudi channel (runtime 1:22). According to bin Salman, Egypt and Saudi Arabia each have documents confirming that the islands belong to the kingdom. Lawyer Khaled Ali was quick to reject bin Salman’s statement and maintain the islands belong to Egypt, Al Masry Al Youm reports.

President Abdel Fattah El Sisi signed off yesterday on amendments to the protest law passed by the House of Representatives last month, Al Shorouk reports.

Lubawa SA, a Poland-based producer of safety and quartermaster equipment, says it ended negotiations and started process of signing an agreement with the Defense Ministry for delivery of “overalls to disarm explosives.” Reuters reports that the agreement is worth EUR 3.8 mn. We’re presuming the talks are over blast suits for EOD techs, of which Lubawa has several lines (example here).

Ikhwan-affiliated militant group Hasm issued a statement yesterday claiming responsibility for the Monday attack that left three members of the police force dead, Egypt Independent reports. The group also vowed to carry out further attacks in defiance of the state of emergency.