Tuesday, 26 September 2017

Watch for two big reveals today: The IMF’s review of Egypt’s economic reform program and El Moselhy’s new domestic trade strategy

TL;DR

What We’re Tracking Today

** It’s a reasonably quiet news morning here in Egypt and around the world (if you can ignore the North Koreans muttering that they can now shoot down US aircraft because the Trump administration has “declared war”). We’re taking this as a chance to enroll in remedial math classes. We managed calculus and linear algebra in university, but simple subtraction is apparently beyond us — we published our first issue on 25 September 2014 (not 2015, as erroneously noted yesterday) and are indeed three years old. Thank you to the countless readers who wrote yesterday with kind words — you made our day, and we’ll be replying to you all over the course of the coming couple of days.

The IMF will publicly release for the first time today its review of Egypt’s economic reform program at a 2:15 CLT presser at which IMF Mission Chief for Egypt Subir Lall will unveil the staff report and other related documents, according to a press notice from the IMF. Lall will field questions on the report, which will officially be released at 3:00 pm. An IMF delegation is due in Egypt toward the end of October to review progress on reform ahead of the disbursal of the third USD 2 bn tranche of the country’s USD 12 bn extended funds facility, which is slated for December.

El Moselhy to unveil new domestic trade strategy today at AmCham: We’re looking forward to AmCham hosting Supply Minister Ali El Moselhy today. The minister is expected to unveil, for the first time, the government’s new strategy for domestic trade. We’ll be attending and will have a full report tomorrow.

Dear Macheads: You may now go download macOS High Sierra. It’s packed with all sorts of stuff under the hood that will take macOS forward for years. Hit up reviews at Ars Technica (by Andrew Cunningham, so ultra-thorough as usual) and iMore. It’s not going to blow you away with a new look or feel, but the new file system will be super-important going forward, Photos is now more powerful, and perhaps best of all, Safari has both declared war on autoplay videos and includes new anti-tracking features, while Notes gets pinned notes and tables.

How do you get the new macOS? Go to open the App Store on your Mac and check the right-hand list of featured downloads or click this link on your computer, which should take you directly to the App Store download page.

What We’re Tracking This Week

The central bank’s Monetary Policy Committee meets this Thursday to decide on key interest rates. The meeting will be the MPC’s first since news rolled in earlier this month that our core inflation rate had dropped to 34.86%.

We can expect to hear on the new board and management teams of state-owned banks in the next few days. Sources tell AMAY that announcement was delayed pending security clearances for the new appointments. Terms for the outgoing management teams officially ended yesterday, and unconfirmed reports on the new appointments have been leaking to the local press since Sunday, with the most notable change looking like CBE Deputy Governor Tarek Fayed replacing Mounir El-Zahed as chairman of Banque du Caire. Two more snippets emerging from AMAY last night include Mahmoud Montasser retiring from his post as number two at the National Bank of Egypt and Ali Al Seidi leaving the board of Banque Misr for a post at another financial institution.

The Council of State should conclude its review of the Dabaa nuclear power plant’s four contracts this week, with the signing expected to happen in two months’ time, or as soon as Russian President Vladimir Putin’s allows. The move is then expected to herald the return of air travel between Cairo and Moscow.

4G services will be rolled out at a ceremony this Thursday, the National Telecommunications Regulatory Authority confirmed on Monday, according to Al Shorouk.

The results of our reader survey will be out in tomorrow’s edition. It’s the largest quarterly survey of senior execs doing business here — and of the folks who invest in them.

On The Horizon

Unified Planning Act should be ready for a cabinet review within 10 days. Also on the cabinet’s plate soon are amendments to a law on the conservation of architectural heritage.

The IMF and World Bank will hold their fall meetings from 9-15 October. A large delegation of Egyptian government officials and senior members of the private sector are set to attend. We should also be getting the new World Economic Outlook in about two weeks’ time.

Enterprise+: Last Night’s Talk Shows

The airwaves offered up a variety of topics last night, ranging from President Abdel Fattah El Sisi’s visit to the UAE to the Mashrou’ Leila concert, which had the talking heads wearing out their soap boxes.

On Kol Youm, Amr Adib’s coverage of El Sisi’s visit to the UAE was more focused on the health of the two countries’ relationship than the actual events from the visit (watch, runtime 5:16). Adib concluded that El Sisi’s journey to the UAE is of greater significance than his visit to New York City earlier this month (watch, runtime 3:58).

Hona Al Asema’s Lamees Al Hadidi rang up Emirati political professor Abdel Khaled Abdullah, who expects the visit was a prelude to a renewed ramping up of pressure on Doha by the Arab quartet with further sanctions if it doesn’t meet their demands (watch, runtime 7:41). Lamees delved further into Qatar with TV, writer (and brother-in-law) Emad Adib, who said that Qatar is unlikely to acquiesce to the quartet’s demands regardless of punitive measures.

Emad Adib also said Egypt is probably putting in more effort to resolving the Israeli-Palestinian conflict than the Palestinians themselves and predicted an imminent truce between the two sides (watch, runtime 1:51).

Egypt’s answer to the Moral Majority wants head on pikes, and it wants them now: The stench of moral indignation is heavy in the air after a number of concertgoers raised LGBTQ rainbow flags at a Mashrou’ Leila rock concert last week. At least seven people have since been arrested for allegedly unfurling the flags, and the issue exploded on the airwaves and on social media yesterday.

Lamees spoke to Musician’s Syndicate official Reda Ragab on the group’s decision to bar the Lebanese alt-rock band performing in Egypt again. After variously claiming that the act might not be Lebanese at all and blaming the security service for letting them into the country, Ragab declared the band is a threat “Egyptian morality” no less deadly than that posed by Daesh (watch, runtime 4:33). We’re sleeping better at night knowing the Musician’s Syndicate is pondering questions of national security.

Supreme Anti-Terrorism Council member Khaled Okasha told Masaa DMC’s Eman ElHosary that the concert’s organizers had no permits — and failed to notify the Interior Ministry that there would be a concert in the first place. Okasha said the event was therefore illegal and dangerous because security forces were not present to ensure attendees’ safety (watch, runtime 15:35).

No commentator last night had an issue with the arrest of the people alleged to have raised the rainbow flag. In fact, 90 Minutes host Moataz Demerdash kicked writer Mohsen El Balasy off his guest panel for having had the temerity to defend the flag-wavers (watch, runtime: 1:08). Needless to say, the arrests are the lead item on Egypt in the international press (see below), and the story will doubtless have several days of legs in it.

Speed Round

Speed Round is presented in association with

Egypt is the top African and Middle Eastern location for offshoring, according to A.T. Kearney’s Global Services Location Index for 2017 (pdf). Egypt’s ranking improved by two places to 14th. According to the index, Egypt topped the world in terms of its financial attractiveness. The report says Egypt’s decision to float the EGP and the currency’s subsequent slide against the greenback “gave Egypt’s competitiveness a boost. The country graduates approximately 500,000 students per year, with 10 percent in IT-related fields and other fields related to BPO, representing one of the largest qualified labor forces outside of India. Chinese Huawei opened a support and training facility to support 29 countries in the Middle East and Africa in the past 18 months, highlighting an emerging trend in which Chinese companies are seeking to shore destinations to support global expansion.” The top three countries on the list are: India, China, and Malaysia, respectively, and have been unchanged since A.T. Kearney started the index. H/t Rolana R.

IPO WATCH- Enppi expected to list by 1Q2018: The IPO of petroleum services outfit Enppi is expected to take place during 1Q2018, Investment Minister Sahar Nasr said yesterday, according to Reuters. The company is set to be the first of a number of state-owned companies to list on the EGX under the government’s IPO program. We had said yesterday that a government committee tasked with oversight of the program had rubberstamped the Enppi offering, which aims to raise USD 213-267 mn from the sale of a 24% stake. CI Capital, Emirates NBD, and Jefferies International have been tapped to advise.

First phase of state IPO program to span 18-24 months: The first phase of the IPO program is expected to take 18-24 months to complete, Finance Minister Amr El Garhy told the press on Monday, AMAY reports. The committee overseeing the program, which was reformed last week, is currently draft a priority-based timetable for the listings, which will not be restricted to a specific industry or sector, El Garhy added.

Separately, the Ismail Cabinet is expected to discuss the Finance Ministry’s planned eurobond issuances at its next weekly meeting, El Garhy said. The ministry is planning a EUR 1-2 bn sale for the end of 2017 and a USD 4-8 bn sale for 2018, we noted last week.

The statements came after a Cabinet economic group meeting yesterday, at which ministers decided to reimpose a ban on white sugar imports in what they said was a bid to continue encouraging “domestic industrial development” and curb imports.

INVESTMENT WATCH- Chinese electronics firm Oppo just short of pledging to open a smartphone plant in Egypt. The company’s president for the Middle East and Africa, Andy Shi, told Youm7 in an interview that Oppo is willing to enter negotiations to establish the plant, but the success of those talks would hinge on how favorable the investment climate is, he said, without elaborating on what he would need to see before committing. The company views Egypt as a crucial markets, and sales here are up 131% in the span of a year. Oppo is also interested in working with mobile network operators on the launch and maintenance of 4G services, although no talks are underway at the moment. Oppo has gained significant global market sharewith a range of phones that have generally been quite well-received by reviewers.

INVESTMENT WATCH- Supermarket operator Spinneys is planning to invest more than EGP 250 mn to double its number of branches in the country to 24 by 2019, the company’s Egypt CEO Mohanad Adly tells Al Mal. Two new branches in Maadi and Al Shorouk City are already under construction, with one set to open next month and another in early 2018. The company is also in talks to acquire space at the new administrative capital to build a large hypermarket within a mall, Adly says. The expansion is part of a company strategy, which began in 2015, to pump c. EGP 500 mn in new investments into Egypt over the course of four years. Spinneys, which is fully-owned by the UAE’s Abraaj Group, is hoping to grow revenues to north of EGP 2 bn by the end of 2018, on the back of new outlets. The group has been on an expansion drive in Egypt since last fall (coverage here and here).

Egypt is making a USD 5.2 bn payment to Afrexim Bank before the end of December, Al Mal reports. USD 3.2 bn of that figure was provided as a short-term loan and USD 2 bn came through a repo transaction after the float of the EGP in November 2016. Repaying Afrexim Bank will reduce Egypt’s foreign debt obligations significantly, CBE Governor Tarek Amer says. Egypt is planning on repaying USD 8.134 bn in loans in 4Q2017, Al Mal notes.

The taxman wants a piece of your e-commerce pie: The Tax Authority is assessing putting in place regulations that would allow it to collect taxes on e-commerce transactions, a source told Al Mal. The source says it is the Tax Authority’s view that online transactions should be subject to VAT. We have many bones to pick with the Tax Man, but this ain’t one of them: We pay our taxes, and so should everyone else, whether you’re selling goods / services online or face-to-face. Global precedent is rather clearly in the Tax Authority’s side on this one, so we hope this is wrapped up quickly and with minimal fuss.

Prime Minister Sherif Ismail ordered the formation of a cabinet committee to resolve investment-related disputes, a decision which was published on the Official Gazette on Monday, Al Shorouk reports. The committee will include the ministers of the cabinet economic group, as well as representatives from the Council of State (Maglis El Dawla) and the Administrative Control Authority.

“We’re not scared,” say Israeli tourists who are flocking to Sinai despite travel warnings to the area, writes Avital Zippel for Jerusalem Online. 2017 saw a 30% rise in Israeli tourists and families who visited Sinai for Rosh Hashanah. Zippel puts the numbers at nearly 10,000 visitors. The primary reason for the bump: “Because it’s cheap,” said one of the vacationers. The influx came despite Israeli border guards issuing repeated warnings on their loudspeakers. Hotel occupancy rates in Taba and Nuweiba soared last week to reach as much as 80% thanks to the Jewish New Year, Chairman of the Nuweiba-Taba Investors Association Samy Soliman tells Reuters’ Arabic service.

This comes as around 133,000 tourists visited Hurghada during the first three weeks of September, Al Masry Al Youm reports. Germans accounted for 68,000 of the town’s visitors during the month, alongside 12,000 Ukrainian, 9,600 Czech, and 9,000 British tourists.

Dissident lawyer and presidential hopeful Khaled Ali’s was sentenced by a Dokki criminal court to three months prison time for violating public decency laws. Ali, who is currently free after posting bail, was charged after publicly celebrating an Administrative Court ruling that overturned the handover of Tiran and Sanafir islands to Saudi Arabia. His lawyer said that the sentence isn’t final and they are planning on fighting it by questioning the validity of the evidence presented. Amnesty International says it sees the sentence as a move to prevent Ali from running in the 2018 presidential elections. The Associated Press’ story on the subject is getting widespread pickup in the international press, including by the New York Times.

Something to keep an eye on: The Palestinian government will meet in Gaza next week to begin taking administrative control of the region as “part of efforts to end protracted rivalry between the Islamist group and President Mahmoud Abbas,” Reuters reports. The Egypt-supported reconciliation effort between Hamas and the Palestinian Authority “may hinge on whether complex issues related to power-sharing can be resolved.”

Libyan general Khalifa Haftar has been accused of human rights abuses, Stephanie Kirchgaessner and Ruth Michaelson write in The Guardian. Experts “unearthed video evidence suggests that Haftar has been complicit in calling for extrajudicial killings and the unlawful siege of the eastern port city of Derna.” Kirchgaessner and Michaelson say the questions surrounding Haftar, who is being supported by Egypt, Saudi Arabia, and the UAE, “have not dissuaded European leaders from seeking to forge an alliance with him.”

Other international news worth noting in brief this morning include:

  • Turn out to Iraqi Kurdistan’s independence referendum reached at least 72%, despite threats by the Dark Lord Sauron of Mord … sorry … Turkey of an economic blockade and war, BBC reports.
  • Israelis can expect some gas shortages after a pipe from the Tamar field cracked and will take days to fix, says Energy Ministry, according to the Times of Israel.
  • Swiss engineering giant ABB will be buying GE’s industrial unit for USD 2.6 bn after the latter accepted its bid on Monday, according to the Wall Street Journal.
  • China has blocked WhatsApp, according to the FT. Silver lining: This gives us faith in its encryption software.

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Image of the Day

Photographer David Degner has been working on a long-term photo project on the role of modern miracles in Egyptian society. “While traveling throughout Egypt, Degner often heard about miracles and that they come in many forms: miracles that are written about in newspapers, for example, or miracles that are only discussed confidentially. His pursuit of these stories lead him to nearly every part of the country: from cities to villages, from mountains to valleys, from deserts to seas. He diligently tracked even the faintest whisper of a miracle story to its source and sought to understand people’s individual experiences and the apparent purpose of these miracles.”

The result was Degner’s“Modern Miracles” project which will be features in a solo exhibition that opens on Thursday in the City of the Dead, at the Maq’ad of Sultan Qaytbay.

Egypt in the News

Topping coverage of Egypt in the foreign press this morning is the controversy arising after some concertgoers raised LGBTQ rainbow flags at a Mashrou’ Leila performance in Cairo last week. Security forces have arrested yesterday seven people who had been seen raising the flag at the concert on charges of “promoting [redacted] deviancy,” Reuters reports. Prosecutor General Nabil Sadek has also tasked the State Security Prosecution Service with investigating the concert after a report was filed on the raising of the flag, Al Masry Al Youm reports.

The public backlash against Mashrou’ Leila in Egypt has been widespread, as we note in Last Night’s Talk Shows, above. The Salafist Nour party plans to submit an official request to the House of Representatives to ban the Lebanese act from performing in the country, Ahram Online reports. The Music Syndicate has reportedly already taken measures to stop the band from performing in Egypt again, saying they perform “‘abnormal art,’” according to Egyptian Streets.

New Trump regs on gun exports could see weapons falling into the wrong hands: The Donald Trump administration will issue new regulations on gun exports that risk seeing weapons fall into “the hands of human rights abusers, terrorists, and international criminal gangs,” Josh Rogin writes in an opinion piece for the Washington Post. The regulations are expected to “significantly reduce oversight and transparency on small-arms exports to governments and private businesses in about three dozen countries,” he notes, arguing that gun manufacturers are the only ones who stand to benefit from the regs. He points to the fact that “Americans and Egyptians alike were outraged to discover that tear gas used in brutal crackdowns on peaceful protesters by Egyptian police had been approved for sale by the US government.”

Also worth a skim today:

  • Energy cooperation Israel could play an important role in the normalization of relations between Egypt and our eastern neighbor, David Awad writes for Al-Monitor.
  • Sheikh Jackson director Amr Salama is working on his new film Iraqi Sniper, “a riposte to “American Sniper” that’s intended to lend perspective to Mustafa, the Iraqi insurgent in Clint Eastwood’s Oscar-winning movie,” Variety says.
  • Syrian families in Egypt are facing significant economic and social challenges, Nikolaj Nielsen writes for EUObserver. The drop in the EGP value and the removal of subsidies on fuel along with unemployment are adding price pressure on the families.
  • A UN project in Egypt mainly targeting women and youth is helping train and educate farmers to improve the country’s food security, AllAfrica reports.
  • The reduced influence of Islamists in countries like Egypt and Tunisia doesn’t mean that these groups’ influence in the region is waning, as electoral gains in Jordan and Morocco tell a different story, says the Washington Post.
  • Students mocking or disrespecting the flag could face a year in jail and fines of up to EGP 30k after a decree by Education Minister Tarek Shawki singling out youngsters, according to The Guardian. (Except we understand it wasn’t a decree, but a circular pointing out that the law mandates the crime of disrespecting the flag is punishable by a year in the clink.)
  • Eman Abdel Atti, who was dubbed the world’s heaviest woman, died yesterday in an Abu Dhabi hospital, according to Khaleej Times.

On Deadline

A heated debate in the local press is underway on the constitutionality of proposed amendments to the Citizenship Act that strip those convicted of terrorism of their citizenship. One of its detractors, Abdallah El Sennawy, takes to Al Shorouk to point out that the amendments — contrary to their stated intent — make no mention of terrorism, opening the door to abuse. MP Moustafa Bakry, who had himself proposed a draft law to strip convicted terrorists of their citizenship earlier this year, penned an oped in El Watan defending the amendments on the grounds of national security. Even he acknowledged the poor wording of the amendments, but passed the buck on to the Council of State, saying it is up to it to remedy the phrasing.

Worth Reading

Meet the chess grandmaster who has Wall Street enamored: For around 25 years, Lev Alburt has been teaching strategy, patience, and prognostication to some of the biggest names on Wall Street, writes James Tarmey for Bloomberg Businessweek. In his modest apartment on Manhattan’s Upper East Side, the three-time US chess champion and notable Soviet Union defector teaches the likes of Carl Icahn, former New York governor Eliot Spitzer, bnaire movie producer Ted Field, and former chairman of Goldman Sachs Stephen Friedman.

But what’s with this obsession in the finance world with chess? Alburt says the game helps traders think on their feet. “Strong chess players are good at making quick, usually correct decisions,” he says. “Traders are basically doing the same things as chess ­grandmasters: You have to make quick decisions in by definition uncertain circumstances.”

“There’s a great satisfaction in ­envisioning how something is going to play out and be right,” says student Doug Hirsch, who manages hedge fund Seneca Capital Investments LP. The game attracts the big names, including George Soros, who is a well-known and aggressive chess player, and Saba Capital founder Boaz Weinstein, a chess prodigy who reportedly got his start at Goldman Sachs, according to Tarmey.

Diplomacy + Foreign Trade

Sudan has denied reports it has “frozen” diplomatic ties with Egypt, Sudan’s Foreign Affairs Ministry said, according to the Sudan News Agency. The rumors began circulating after claims that Egypt voted in the UN against revoking economic sanctions imposed on the Sudan. Ties between Egypt and Sudan are going through “a crisis” because of the issues surrounding the Halayeb Triangle and Egypt’s “restrictions” on Sudanese miners there, Sudan’s Foreign Affairs Ministry had said earlier this month.

The UK trade delegation headed by trade envoy Sir Jeffrey Donaldson met yesterday with Oil Minister Tarek El Molla to primarily discuss ongoing projects in oil and gas in Egypt and windows for further investments in the sector, Al Shorouk reports. The delegation also met with Housing Minister Mostafa Madbouly to discuss housing and infrastructure projects, particularly in the new administrative capital and the New Alamein City, according to Al Mal. The meetings followed one with Prime Minister Sherif Ismail, where Donaldson assured that he had been making significant efforts promoting investments in Egypt in a number of UK cities,according to a cabinet statement.

President Abdel Fattah El Sisi met yesterday with Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed Al Nahyan, according to an Ittihadiya statement (pdf). The two agreed on the importance of Arab cooperation in the fight against terrorism, “particularly with regard to halting the funding of terrorism, providing arms and fighters, and offering safe haven and political and media coverage for them.” This is more than likely a reference to a pariah statelet which rhymes with Tartar. El Sisi, who was in the UAE for a two-day visit, also attended Al Nahyan’s weekly council meeting (pdf), which was focused on security and regional stability. The National also has coverage.

Energy

ABB Group looking to supply FiT projects with equipment

Swiss-Swedish conglomerate ABB Group is hoping to supply energy companies with equipment they need for solar power projects they’re establishing under the feed-in tariff (FiT) program, the company’s Regional Director Nagy Gregory tells Al Mal. ABB is currently in talks with more than 10 solar power companies and is also hoping to participate in projects from the government’s upcoming investment map, particularly in the Suez Canal Economic Zone.

Oil Ministry to unveil strategy to develop mineral resources next year

The Oil Ministry is planning to unveil its strategy for the development of Egypt’s mineral resources sometime next year, Minister Tarek El Molla said yesterday, Al Shorouk reports.

NREA to receive financial, technical offers for 250 MW Gulf of Suez wind farm next month

Vestas, Siemens, Enercon, and Ray Power will submit their technical and financial offers to develop the 250 MW Gulf of Suez wind farm next month, sources from the New and Renewable Energy Authority (NREA) tell Al Borsa.

Basic Materials + Commodities

UK to lose market share in seed potato exports to Egypt thanks to Brexit

EU seed potato producers are expected to swoop in and increase supplies to Egypt in place of UK exporters that would be at a disadvantage post-Brexit, according to a Rabobank research note. Egypt is the largest importer of seed potatoes, sourcing more than 70% of its yearly seed potato requirements from the Netherlands and the UK. “UK seed potato exporters will not only face a cost price disadvantage versus EU exporters due to a potential rise in import tariffs—an increase in non-tariff trade barriers can also be expected … EU seed potato producers are in the position to increase their market share at the expense of the more expensive post-Brexit UK producers to non-EU countries. However, to what extent EU producers will benefit depends on how fast the UK government will be able to close new trade [agreements] removing tariffs on seed potatoes after leaving the EU.”

Gov’t completes Romanian wheat shipment sieving -El Moselhy

The poppy-seed containing Romanian wheat shipment was sieved and is now ready for use, Supply Minister Ali El Moselhy said, according to Reuters. The government now awaits the decision of the prosecutors, which will decide the fate of the 63k tonne shipment. The Agriculture Quarantine Authority had rejected the wheat shipment because it contained poppy seeds.

Health + Education

El Sisi orders plan to raise teacher’s salaries

As the government launches back to school season, President Abdel Fattah El Sisi ordered a plan to raise teachers’ salaries,according to AMAY. The Education Ministry has reportedly completed drafting the plan and has presented it to the president.

Real Estate + Housing

Residence set to begin work on Aroma 2 project

Real estate firm Residence Egypt has broken ground on its EGP 950 mn (and horribly named) Aroma 2 development in Ain Sokhna, according to Al Mal. The project consists of 350 homes and a 650 room four star hotel. Delivery on Aroma 1 has been complete with total sales coming in at EGP 350 mn.

Tourism

TPA approves disbursing charter flights incentive program payments

Tourism Promotion Authority (TPA) head Hisham El Demery has signed off on disbursing payments to foreign charter airlines under the 2015 charter flights incentives program through to December 2016, TPA Deputy President Ahmed Hamdy said, Al Masry Al Youm reports. A second package of the payments for the January-March 2017 period will be reviewed soon and disbursed next September, Hamdy said. The Tourism Ministry is also considering extending the program for an additional year beyond its 31 October expiry date. The program offers payouts and fee exemptions to flights with 50-80% seat occupancy rates that bring in regular tours from the EU to Egyptian airports, including Sharm El Sheikh, Hurghada, Luxor, Taba, Marsa Matrouh, and Alamein.

Air Leisure organizing charter flights from Japan to Egypt

Air Leisure is running charter flights from Japan to Egypt, said Deputy Minister of Tourism Adla Ragab according to Al Mal. Ragab met with five tour operators and addressed issues of security and increased demand for Egypt as a destination. Aside from the charter flights there were also requests for EgyptAir to increase their frequency of flights to two or three a week.

Air Cairo to offer two weekly flights to Tbilisi

Charter airline Air Cairo will start offering two direct weekly flights to Georgian capital Tbilisi on Mondays and Thursdays starting 3 November, Russian news website Vestnik Kavkaza reports.

Automotive + Transportation

Construction on Cairo Metro Line 4 to begin in 1Q2018

The Transport Ministry expects to break ground on the first phase of Cairo Metro Line 4 in 1Q2018, an unnamed ministry source tells Al Shorouk. The process of preparing Haram Street for digging to begin will take two more months to complete, the source says. The ministry is also closing in on a final agreement with a Japanese contracting company to develop the metro line, after having launched a tender in April. Phase 1 stretches over 19 km from 6 October to Fustat and will include 17 stations, officials had previously announced. The project will be funded by a USD 1.2 bn loan from the Japan International Cooperation Agency.

Transport Ministry reviews AVIC’s plans for Sokhna Alamein rail line

The Transport Ministry is looking to a Chinese consortium led by AVIC for implementation of a new rail line running from Ain Sokhna to El Alamein, according to Al Borsa. Transport Minister Hesham Arafat reviewed the plans proposed by the Chinese consortium which maps out five main stations for the 482 km line which will run through the New Administrative Capital, 6 October, and Alexandria. Arafat requested that AVIC upgrade the speed of the trains from 160 km/h to 250 km/h. The new line between Ain El Sokhna and El Alamein will serve both urban commuters and the transportation of goods.

Shell becomes exclusive engine oil suppliers to FCA after sales centers

Fiat Chrysler Automobiles (FCA) has signed an agreement with Shell for it to become the exclusive supplier of engine oils in all of FCA’s after sales service centers for the Chrysler and Jeep cars across Egypt. Shell Egypt CEO Saher Hashem says the strategic partnership between the two companies follows the international agreement between the two companies globally.

Banking + Finance

NEST to delist, approves buyout plan to delist

Real estate firm North Africa Company for Real Estate Investment’s (NEST) is planning to delist, with its extraordinary general assembly approved a plan to buyout shareholders opposed to the move, according to Reuters. The buyout price approved will be EGP 1.2 per share.

Alexandria Portland Cement approves EGP 200 mn loan

Alexandria Portland Cement’s board approved a EGP 200 mn revolving loan facility from HSBC to finance working capital, capex, and “general purposes,” according to an EGX disclosure. The loan carries a tenor of 33 months and an aggregate interest rate of the CBE lending rate plus a 3% margin. Alexandria Portland Cement is part of the Titan Cement Company.

Egypt Politics + Economics

Egypt bond yields drop 115 bps in a week

The average yields on Egypt’s five- and 10-year government bonds dropped significantly in yesterday’s auction, Reuters reports. The yields on both bonds dropped to 15.00% from 16.15% in the last similar auction. Finance Ministry data notes that the two bond auctions were covered 3.4 and 3.8 times, respectively. CI Capital Senior Economist Hany Farahat attributed the improved liquidity to higher foreign currency inflows in recent months.

International trade unions call for Egyptian union members’ release from detention

Two international trade union groups called for the release of eight Egyptian union members who were arrested last week for attempting to organize protests, Ahram Online reports. In a joint letter to President Abdel Fattah El Sisi and Prime Minister Sherif Ismail, the International Trade Union Confederation and Public Services International condemned the “unjustified escalation” against the workers, who are currently facing charges of inciting strikes, misuse of social media, and affiliation to an outlawed group, among others.

National Security

Warship delivery due in October

The first of four French corvette warships we acquired is due to make port in Alexandria 21 October, according to the Egypt Independent. The ship is enroute to Kiel Germany where it will join a German-made submarine Type 42 model 209 before making their way home.

Sports

FIFA says El Hadary is eyeing history with World Cup qualification close

Veteran goalkeeper Essam El Hadary is “eyeing history” with an Egypt side that is close to qualifying to World Cup, FIFA.com reports. “At the heart of Egypt’s bid to end a lengthy barren run is El Hadary, an age-defying shot-stopper who has so far enjoyed a glittering career but is still hungry for more success — most notably an elusive World Cup appearance.” El Hadary would be the oldest player to play in the World Cup should Egypt qualify.

On Your Way Out

ON THIS DAY- On this day in 1973, the Concorde made its first non-stop transatlantic flight, crossing from Washington DC to Orly airport in Paris in a record-breaking time of three hours and 32 minutes. In 1960, Americans tuned in to the first-ever televised debate between the two candidates running for the White House: Richard Nixon and John Kennedy. Earlier in the century, Great Britain annexed the Ashanti Kingdom and placed it under the governor of the Gold Coast in 1901. This time last year, Enterprise readers were reading about how we were told to expect Russian flights to resume in October 2016.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.6169 | Sell 17.7169
EGP / USD at CIB: Buy 17.61 | Sell 17.71
EGP / USD at NBE: Buy 17.63 | Sell 17.73

EGX30 (Monday): 13,674 (+0.5%)
Turnover: EGP 1.1 bn (28% above the 90-day average)
EGX 30 year-to-date: +10.8%

THE MARKET ON MONDAY: The EGX30 ended Monday’s session up 0.5%. CIB, the index heaviest constituent ended down 0.1%. EGX30’s top performing constituents were: Abu Dhabi Islamic Bank up 7.8%, Egyptian Resorts up 6.5%, and Arab Cotton Ginning up 4.6%. Yesterday’s worst performing stocks were: Eastern Co down 1.4%, Arabian Cement down 0.6%, and AMOC down 0.4%. The market turnover was EGP 1.1 bn, and local investors were the sole net buyers.

Foreigners: Net Short | EGP -42.6 mn
Regional: Net Short | EGP -0.1 mn
Domestic: Net Long | EGP +42.7 mn

Retail: 68.4% of total trades | 64.3% of buyers | 72.6% of sellers
Institutions: 31.6% of total trades | 35.7% of buyers | 27.4% of sellers

Foreign: 11.3% of total | 9.5% of buyers | 13.2% of sellers
Regional: 11.4% of total | 11.3% of buyers | 11.3% of sellers
Domestic: 77.3% of total | 79.2% of buyers | 75.5% of sellers

WTI: USD 52.12 (-0.19%)
Brent: USD 59.08 (+0.10%)
Natural Gas (Nymex, futures prices) USD 2.93 MMBtu, (+0.24%, October 2017 contract)
Gold: USD 1,313.40 / troy ounce (+0.14%)TASI: 7,224.13 (-1.39%) (YTD: +0.19%)
ADX: 4,410.53 (-0.67%) (YTD: -2.99%)
DFM: 3,569.42 (-0.86%) (YTD: +1.09%)
KSE Weighted Index: 428.97 (-1.21%) (YTD: +12.86%)
QE: 8,449.47 (+0.64%) (YTD: -19.04%)
MSM: 5,129.54 (+0.57%) (YTD: -11.30%)
BB: 1,291.89 (-0.90%) (YTD: +5.85%)

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Calendar

25-27 September (Monday-Wednesday): Egypt Downstream Summit and Exhibition, Kempinski Royal Maxim Palace, Cairo.

26 September (Tuesday): Egypt’s Internal Trade Reinvented event with Supply Minister Ali El Moselhy, AmCham, Cairo.

28 September (Thursday): Central Bank of Egypt’s Monetary Policy Committee to review policy rates.

September — The House of Representatives is due to begin discussion of the proposed bankruptcy bill.

30 September-01 October (Saturday-Sunday): Techne Summit, Bibliotheca Alexandrina, Alexandria.

03 October (Tuesday): Egypt’s Emirates NBD PMI reading released.

03-05 October (Tuesday-Thursday): J.P. Morgan’s Credit and Equities Emerging Markets Conference, London, UK.

06 October (Friday): Armed Forces Day, national holiday.

11-12 October (Wednesday-Thursday): 2030 Mega Projects Conference, Nefertiti Hall, Cairo International Convention Center, Cairo.

11-13 October (Wednesday-Friday): Middle East and Africa Rail Show, Cairo International Convention Center, Cairo.

15-16 October (Sunday-Monday): The Marketing Kingdom Cairo 3 conference, Dusit Thani Lakeview Hotel, Cairo.

17 October (Tuesday): The Narrative PR Summit, Four Seasons Nile Plaza, Cairo.

18-19 October (Wednesday-Thursday): Middle East Info Security Summit, Sofitel El Gezirah, Cairo.

18-20 October (Wednesday-Friday): AfriLabs annual gathering with the theme “Future of Cities: Innovation, Spaces and Collaboration,” The French University, Cairo. Register here.

23-27 October (Monday-Friday): 29th Business and Professional Women International Congress themed “Making a Difference through Leadership and Action,” Mena House Hotel, Cairo. Register here.

06-07 November (Monday-Tuesday): Crisis Communications Conference, Four Seasons Nile Plaza Hotel, Cairo.

16 November (Thursday): Central Bank of Egypt’s Monetary Policy Committee to review policy rates.

19-21 November (Sunday-Tuesday): 11th Annual INJAZ Young Entrepreneurs Competition, Four Seasons Nile Plaza, Cairo.

26-29 November (Sunday-Wednesday): 21st Cairo ICT, Cairo International Convention Center, Nasr City, Cairo.

01 December (Friday): Prophet’s Birthday, national holiday.

03-05 December (Sunday-Tuesday): Solar-Tec, Cairo International Exhibition & Convention Centre.

03-05 December (Sunday-Tuesday): Electrix, Cairo International Exhibition & Convention Centre.

07-09 December (Thursday-Saturday): The Africa 2017 forum: “Business for Africa, Egypt and the World” Conference, Sharm El Sheikh.

08-10 December (Friday-Sunday): RiseUp Summit, Downtown Cairo.

28 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee to review policy rates.

17-21 February 2018 (Wednesday-Saturday): Women For Success – Women SME’s "World of Possibilities" Conference, Cairo/Luxor.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Etisalat Misr (tax ID: 235-071-579), the leading telecoms provider in Egypt; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.