Sunday, 10 December 2017

Putin is inbound. With Dabaa possibly in the bag, will direct flights be back?

TL;DR

What We’re Tracking Today

It’s looking like Dabaa is finally happening this week: Russian President Vladimir Putin will arrive in Egypt on Monday, according to a Thursday statement from the Kremlin. While the statement is vague on what he’s due to discuss with President Abdel Fattah El Sisi, it seems almost certain that the signing of the USD 30 bn Dabaa nuclear power plant with Rosatom — which the Electricity Ministry said would be signed before the end of the year — will be on the agenda. Speculation is rife in the local media on the day of the actual signing, with Al Mal saying it is on Monday and Al Shorouk claiming it will take place on Tuesday. Both are citing ministry sources. A delegation from Rosatom also reportedly announced that work on the plant would begin this month, according to Ahram Online.

Putin is also expected to sign an agreement for a Russian Industrial Zone in the Suez Canal Economic Zone, said Mohamed Aboul Enein, who heads up the Egyptian-European Business Council, according to Al Shorouk. After hitting a roadblock this summer, talks on the RIZ have been going smoothly since October, with reports that the Russian government is willing to back companies investing in the zone to the tune of USD 9 bn.

Perhaps now Russian planes will be allowed to fly directly to Egypt once again?

Weekend news included plenty of announcements out of Sharm El Sheikh, where a who’s who of the Egyptian business community gathered for a “business with Africa” conference held under the auspices of the presidency. One thing we haven’t seen coming out of the conference: The investment map of some 600 projects the Investment Ministry said it would release in Sharm.

UN-backed Libyan Prime Minister Fayez Al Sarraj is scheduled to meet President Abdel Fattah El Sisi today, an unnamed senior Libyan source tells Youm7. The two are expected to discuss the latest developments in the Libyan reconciliation process, including Egypt’s efforts to unify Libya’s military.

Generational divide on Jerusalem? For all of the barrels of ink used up anticipating fallout from The Donald’s recognition of Jerusalem as the capital of Israel (and to say nothing of the late-night bloviating on the airwaves), Egypt’s streets were resoundingly chill from Thursday and through this morning. Protests attracted a few hundred people at most. Perhaps related, we’re picking up signs of a generational divide on the development. Anecdotally: Gen Xers and below are more (dispassionately) concerned with the regional implications of the move than they are outraged. Boomers, coming from a generation more invested in the Palestinian cause, feel much more strongly. Take this tweet from Mounir Abdelnour, the well-known businessman who served with distinction as minister of tourism and as minister of trade and industry: “What if EgyptAir cancelled its contract to buy Boeing planes, the Ministry of Trade suspended TIFA negotiation, the Oil Ministry withdrew its invitation for US companies to explore for oil here, and the government refused to receive US Vice President Pence,” who is due here later this month.

Pope Tawadros II and Al Azhar boss Ahmed El Tayyeb have both said they will not meet with Pence in protest of the decision (coverage here and here). Pence had made the state of Egypt’s Christian community a key talking point of his planned visit.

And speaking of The Donald: Inside Trump’s hour-by-hour battle for self-preservationmade its way to our inbox just about a dozen times, forwarded by friends and readers who thought it might be of interest. The epic piece in the New York Times is a fascinating portrait of The Donald, his psychology, and of efforts to bring structure to his day. It’s a portrait of a leader who tweets in his PJs, gorges on television, considers a 9am or 9:30am start to the workday ‘early’ and who some aides say has a “tenuous grasp of facts, jack-rabbit attention span and propensity for conspiracy theories.”

And while you’re reading the Times, check out After 7 years of job growth, room for more, or danger ahead?, out just after a better-than-expected US jobs report on Friday.

(Western) Christmas comes 10 days early this year as Star Wars: The Last Jedi opens this coming Friday, 15 December — and the iPhone X goes on sale here in Omm El Donia the same day. Read an interview with the cast of the next Star Wars flick, or head over to Apple’s Egypt site to confirm we’re not mistaken about the release date (scroll down a couple of times for the release date to appear).

So, young analyst, you think you’re a genius at Excel? Meet the 77-year-old Japanese miser who, in retirement, decided to teach himself to paint — and is now making art in Excel (watch, runtime: 2:28).

What We’re Tracking This Week

The China Fortune Land Development Company (CFLD) will iron out this week the final details of its contract to develop 14k feddans in phase one of the new administrative capital, government sources tell Al Borsa. The meeting with the New Administrative Capital Company for Urban Development will set the final price of the land, the timeline and stages of development, and schedule of revenue payments to the government. The government will receive 60% of the revenue under its agreement with CFLD. CFLD is planning to spend USD 4 bn developing parts of the new city over the next five years, a figure it plans to increase to USD 13.5 bn over the next ten years. Phase one will see an industrial zone being developed on the outskirts of the new capital.

The central bank will be selling USD 1 bn in USD-denominated T-bills tomorrow, Reuters reports.

On The Horizon

The Central Bank of Egypt will review interest rates at a meeting of its Monetary Policy Committee on 28 December. Keep an eye on monthly inflation figures due out any time in the coming few days.

Ethiopian Prime Minister Hailemariam Desalegn is expected to address Egypt’s House of Representatives sometime this month. Egypt and Ethiopia are locked in a war of words over use of Nile water.

Enterprise+: Last Night’s Talk Shows

The US’ Jerusalem declaration was still the topic du jour on the airwaves last night, as the nation’s talking heads continued to grapple with potential repercussions.

Arab countries should no longer depend on the US to play peacemaker in the region, Palestinian Liberation Organization executive committee member Hanan Ashrawi told Kol Youm’s Amr Adib. She accused Israel of using Trump’s declaration as an excuse to expand its settlements in Jerusalem and increase its aggression against Palestinians (watch, runtime: 13:24).

Adib agreed that the US should be cut out of any further Israeli-Palestinian peace talks, and couldn’t help but point to the lack of concrete action to counter Trump’s move (watch, runtime: 3:35)

He apparently had to look no further than Hona Al Asema, where his better half Lamees Al Hadidi emphatically called on Arab leaders to refuse to meet with US Vice President Mike Pence during his current regional tour and cried conspiracy, saying Trump’s hatred for Arabs was evident from the get-go. What say ye, every Egyptian out there who ululated at Trump’s election because he would be a “friend to the region”? (watch, runtime: 11:02).

Over on Masaa DMC, the Palestinian President’s adviser Mahmoud Al Habash said that Palestine is relying on decisive Arab action and not the UN, noting to host Eman El Hosary that the US holds the power to veto any resolution within the UN Security Council (watch, runtime: 5:34).

Meanwhile on Al Hayah Al Youm, Tamer Amin had a chat with Customs Authority head Magdy Abdel Aziz abouthow EGP float helped curb smuggling at national ports. They also discussed the government’s strategy to boost exports and decrease imports, with Abdel Aziz reminding everyone that levies on cars imported from the EU and Agadir countries will reach 20% under an ongoing FTA that will see them lifted entirely by January 2019, while the rate for imports from other countries will climb to as much as 137% (watch, runtime: 29:44).

Speed Round

Speed Round is presented in association with

IPO WATCH- Banque du Caire will IPO in 3Q2018, CBE Governor Tarek Amer said in a statement to the press at the Business for Africa and the World Summit on Thursday, Al Borsa reports. Amer did not provide further details on the planned IPO, which was initially expected to take place this fall, but was delayed as a result of the central bank’s shakeup of management at state-owned banks. Government officials had said at the time that the bank’s new leadership would be key to promoting the original offer. The EGX had approved in February BdC’s request to list 562.5 mn shares at par value of EGP 4 per share. Industry types had later said the government is considering selling up to 49% of Banque du Caire as part of the IPO process, including 5% which would trade a global depositary receipts on the London Stock Exchange. EFG Hermes and HSBC are managing the issuance, while Baker McKenzie has been tapped as legal advisor.

Separately, Amer said that the sale of United Bank still needs more time as the bank’s restructuring process is still in progress.

M&A WATCH- Our friends Pharos Holding and Banque Misr Investment Banking (BMIB) announced on Thursday the closing of the sale of a 97.7% stake in National Company for Maize Products (NCMP) to Cairo Three A through a mandatory tender offer. “I am delighted to witness the final closure of the NCMP transaction which underscores Pharos Investment Banking’s growing presence in the M&A and capital market transactions arena as well as our successful cooperation with Banque Misr, our partner in the process,” Pharos Holding Managing Director and Head of Investment Banking Sherif Abel Aal said in a statement. Pharos and BMIB were the sell-side advisors for Misr Capital Investments and the National Bank of Egypt, the majority shareholders of NCMP.

M&A WATCH- Al Ahly Capital acquired 100% of the International Company for Livestock from its corporate parent, the National Bank of Egypt, in a EGP 1 bn transaction, Al Ahly Capital CEO Khaled Badawi tells Al Masry Al Youm. The holding company plans on using the livestock company’s 600-feddan farm in Abu Rawash to establish an industrial project with initial investments of EGP 3 bn over the next three to four years. No further details were provided on the nature of the project.

MOVES- CIB announced the appointments of Amani Abu-Zeid and our friend Magda Habib as non-executive directors of its Board of Directors, according to a bourse statement. The board will advise the bank’s general assembly of the changes at its next meeting.

Egypt signed a wave of funding agreements totaling almost USD 1.9 bn over the weekend.

First up, the World Bank and Egypt signed for disbursement of the USD 1.15 bn third and final tranche of a USD 3.15 bn facility to support economic reforms, the bank said in a statement on Friday. USD 150 mn in the tranche came from the UK government.

Next, the African Export Import Bank (Afreximbank) signed a USD 500 mn loan agreement with the Export Development Bank of Egypt, the bank said in a statement on Friday. The agreement, signed during the sidelines of the Business for Africa, Egypt and the World Summit in Sharm El Sheikh, will be used to fund Egyptian trade with Africa. The loan will also provide assistance to Egyptian export promotion councils and business associations. Afreximbank also signed an MoU with Morocco’s Attijariwafa Bank to cooperate on funding trade between Egypt and the continent, Youm7 reports. No price tag was noted on the agreement.

The European Investment Bank (EIB) agreed to loan EUR 250 mn to Banque Misr at the summit on Saturday, Al Borsa reports. The loan is but the first tranche of a EUR 500 mn facility, said Banque Misr Vice President Akef El Maghraby. Banque Misr also signed a USD 40 mn agreement with the Arab Bank for Economic Development in Africa to fund trade with the continent, added El Maghraby.

Speaking of the EIB, the bank is planning to form a subsidiary focused on non-EU projects, Reuters reports. The new offshoot will initially focus on countries fuelling the EU migration crisis and would provide loans of up to EUR 7-9 bn a year. The move was meant to streamline lending outside the EU.

Is OTMT looking to make another play at Oi? Naguib Sawiris reportedly said he is again interested in embattled Brazilian telecom Oi — if Brazil’s government “takes the right steps,” according to Bloomberg. Sawiris’ second change of heart came after the court presiding over Oi’s bankruptcy said the operator’s CEO has the power to negotiate a restructuring plan with creditors and present it to court without approval from the shareholder-controlled board. Sawiris had said back in October that he had lost interest in the company after a creditor vote on a restructuring plan to help it exit bankruptcy protection was delayed four times. OTMT had offered in December an exchange of debt for shares and a capital injection of as much as USD 1.25 bn in Oi, which filed last year for Brazil’s biggest ever bankruptcy protection to restructure USD 20 bn of debt. The Orascom bondholder group had committed to underwriting the entire capital injection if no other investors stepped forward.

Sawiris may now have to contend with serious competition, though, as Chinese telecom giant China Telecom Corp also will reportedly also present a firm offer after following the conclusion of the debt restructuring.

Speaking at the Business for Africa 2017 Summit, Sawiris also made a number of other announcements, including:

  • Expect a fresh investment from OTMT in 2018 as the company has USD 250 mn to deploy and may borrow a similar amount.
  • OTMT is considering starting a residential- and second-home development business in Egypt.
  • The company is also planning two agri-business projects in Cote D’Ivoire in 2018 worth about USD 30 mn each. It is also looking at similar projects in Mali, Burkina Faso, Sudan and South Sudan
  • OTMT is studying mining projects in Niger and Mauritania.

Investors in Beltone shares acquitted of market manipulation: An economic court acquitted last week all 12 investors accused of manipulating Beltone Financial’s share price, Al Borsa reports. No Belton executive had been implicated in the case, which dates back to February 2016, when investors allegedly bid for large blocks of Beltone shares before canceling minutes later, prompting Beltone’s share price to surge. The EGX repeatedly reversed trades in Beltone’s shares, pushing Beltone to sue the heads of the EGX and EFSA for “deliberately harming” the firm. According to a report from experts enlisted by the court, the investors were found innocent of manipulating Beltone’s shares. The surge in the firm’s share price was attributed to the February 2016 announcement that Orascom Telecom Media Technology (OTMT) asked Beltone Financial, its subsidiary, to complete its acquisition of CI Capital as part of OTMT’s strategy to combine Beltone and CI Capital to create a regional financial conglomerate. The report also blamed the EGX’s reversal of trades for driving investors to speculate and purchase large chunks of the firm’s shares.

Breaking down trade barriers, backing loans for SMEs, encouraging boldness in bureaucrats and more at the Africa 2017 conference: A who’s who of Egyptian business gathered this weekend in Sharm El Sheikh for the 2017 edition of Egypt’s flagship conference on doing business with Africa. Plenty of news followed:

CBE Governor Tarek Amer announced that the central bank will start handing out assurances [the word we want to use starts with ‘guarant’ and ends in ‘ees’ but the spam filters hate it] to banks for SME loans by the end of December, Al Borsa reports. The CBE will back loans to SMEs in Upper Egypt to the tune of 70% of the value of the loan and will cover 60% of the loan value in the rest of Egypt. Amer added that EGP 45 bn in loans have been provided to SMEs so far under the CBE’s EGP 200 bn initiative.

President Abdel Fattah El Sisi announced that the government is working on new legislation intended to shield civil servants from punishment if an investment agreement does not work out. The move is designed to encourage government officials to take bold steps and initiatives without fear of political backlash which could lead to their firing, he said, according to Al Mal. Longtime readers of Enterprise would recall that timid and change-averse bureaucrats were one of the many complaints brought up by investors at the Egypt Economic Development Conference in Sharm El Sheikh back in 2015. The issue has been a persistent theme since the bureaucrats and former ministers were prosecuted and subjected to third-party lawsuits after the events of January 2011.

But the overarching theme of the conference was removing trade barriers in the continent — something we really need to work on considering our poor showing in that category of the World Bank’s Doing Business Report 2018. The theme was touched upon quite eloquently by our friend CIB Chairman Hisham Ezz Al-Arab, who called for Africa’s trading blocs to do more to cut trade barriers. Ezz Al-Arab said the move would do much to spur investment in the continent and drive industrial development, which the continent sorely needs, Al Masry Al Youm reports. Africa needs USD 90 bn for infrastructure development, healthcare and education, making it a choice location for investment, Ezz Al-Arab said. CBE Governor Tarek Amer also touched on the same point when he appeared to support a move towards acommon currency for the continent.He did acknowledge that such a move remains a dream, but should be a goal that African nations should aspire to, according to Al Shorouk.

In the less-distant horizon, it appears Egypt will continue to push to form an African Trade Zone through the merger of COMESA, EAC and SADC trade blocs. The issue is expected to come up at an African Union summit next month, sources said, according to AMAY. The ultimate goal would be to see tariffs between nations of the zone reduced 90% over a five-year period. Furthermore, the government and four other nations have agreed in principle to establish an overland route connecting Egypt and Chad, said Alaa Ezz, the secretary general of the Federation of Egyptian Chambers of Commerce, said in statements to state news agency MENA. The government is in talks with the EU to fund the feasibility study for the project and will issue a tender for the study soon, he added, according to Al Borsa.

Other highlights from the conference includes the Higher Education Ministry signing an MoU with emerging markets private equity giant Actis to establish a university in Egypt, Al Mal reports. It is unclear if the investment by Actis is part of its major pan-African higher education initiative, Honoris United Universities, but the company did say at the signing that the partnership would be similar to that of its South Africa Regents Business School, which is funded through Honoris.

The EGPC has signed oil and gas exploration agreements with three international companies worth a combined USD 50 mn, an Oil Ministry official tells Al Borsa. These include a USD 20 mn oil and gas exploration agreement with our friends at Apex International in the West Badr El Din concession in the Western Desert, a USD 10 mn gas exploration agreement with Trident Petroleum for exploration in the Magawish block of the East Esh El Mallaha concession, and a USD 20 mn oil and gas exploration agreement with Apache-Khalda in the Alam El Shawish concession in the Western Desert.

Meanwhile, it looks like Noble Energy is trying to make a play for the potential gas pipeline linking Cyprus’ offshore gas fields to Egypt’s processing facilities, Al Masry Al Youm reports. The group’s senior Vice President of the Eastern Mediterranean area Keith Elliott met with Oil Minister Tarek El Molla to discuss this and other potential energy projects on Saturday.

The coming Egyptian citrus season “should be great,” Ahmed Abdelhady, from citrus exporter Citrozone, tells Freshplaza. “The volumes for Navel oranges are higher than last year. Last year we had a shortage, which had to do with weather related issues. We also have similar volumes for Valencia oranges,” he says. The EGP devaluation has helped the industry and is supporting a strong season, producer Hussein Marei says. “Profits have been amazing for the past few months, and growers have been reminded of the potential of citrus. Growers need able to demand higher prices because the prices of fertilizers, cartons and energy have gone up because of devaluation of our currency. But this has proven to be okay, because the Egyptian people can afford the local products.”

Will Sudan lift its ban on imports of Egyptian products by January 2018? Sudanese Investment Minister Mubarak Al Fadel tells Al Borsa that Egypt and Sudan have held several meetings to resolve the issue — and that Khartoum will likely lift the bans by the beginning of next year. According to Al Fadel, Sudanese Trade Minister Hatem El Ser Aly arrived in Cairo several days ago for talks with Egypt’s Tarek Kabil to discuss the imports crisis and ways to improve cooperation. Al Fadel also said that the coming period will see increased economic trade and cooperation between the two “brotherly” countries, pointing to businessman Naguib Sawiris’ plans to establish a major touristic project in Sudan.

However, Deputy Agriculture Minister Safwat El Haddad denied the news, telling Al Mal that there are “no new developments” on the issue. Khartoum had imposed a succession of bans on Egyptian imports in September 2016 and March of this year, followed by a blanket ban in May. The bans came as relations between Egypt and Sudan continued to deteriorate and tensions flared. Sudanese President Omar Al Bashir had accused Egypt of arming rebels — an accusation President Abdel Fattah El Sisi denied — and another “crisis” arose between the two countries over territorial claims over the Halayeb and Shalatin triangle.

Meanwhile, the Agriculture Ministry is still pressing Saudi Arabia to look into lifting its ban on imports of Egyptian strawberries and peppers, El Haddad tells Al Mal. The ministry requested that the Kingdom send a technical team to inspect the farms and packaging stations, according to El Haddad, who says he expects that Riyadh will lift the ban following the inspections, which could wrap by the end of the month. Agriculture Ministry spokesperson Hamid Abdel Dayem had claimed in October that Saudi Arabia had lifted its ban on imports of Egyptian strawberries, but it was unclear at the time whether the move was temporary or permanent. The strawberry ban, which KSA imposed in July over concerns of high levels of residual pesticide, came months after a separate ban on all kinds of peppers for the same reason in December 2016.

The backlash against US President Donald Trump’s decision to move the US embassy in Israel to Jerusalem from Tel Aviv continued to dominate the regional conversation over the weekend. In a nutshell: Reactions have been somber but relatively muted, barring diplomatic condemnations and Palestinian deaths as a result of protests and exchange of fire with Israeli forces in a “day of rage.”

Hamas called for a new “intifada,” while the Palestinian Authority says there will be "no talking" with the US until Trump reverses the decision. Egypt was spared the protests seen in other parts of the region, with the Interior Ministry banning a planned protest by parties of the Democratic Coalition and arresting suspected ikhwanis for trying to incite them.

On the diplomatic front, Egypt and 13 other member states condemned Trump’s decision at a meeting of the UN Security Council on Friday. Britain, France, Germany, Sweden and Italy called on the US to put forward detailed proposals for peace between Israel and the Palestinians after the “unhelpful” decision.

At an emergency Arab League meeting in Cairo yesterday, Egypt also denounced “unilateral decisions that violate international law and threaten to upend the global political order.” Arab League Chief Ahmed Aboul Gheit “called on world nations to recognize the State of Palestine with east Jerusalem as its capital in response.” Saudi Foreign Minister Adel Al Jubeir called on the US to backtrack on its decision.

…Egypt’s religious leaders said they will refuse to meet US Vice President Mike Pence when he arrives in Egypt on 20 December, state news agency MENA said on Saturday.The Coptic Church and Al Azhar Sheikh rejected Pence’s request for a meeting. Palestinian President Mahmoud Abbas has also said he will refuse to meet Pence.

Not content with upsetting allies over Jerusalem, Trump issued a statement calling on Saudi Arabia to immediately end its blockade of Yemen. On Friday, Secretary of State Rex Tillerson called on Saudi Arabia’s leaders to “think through the consequences” of their actions and be “a little bit more thoughtful,” Bloomberg reports.

Also from across the pond, we hear that Deputy national security adviser Dina Powell is leaving her position in the White House. Powell, of Egyptian-American heritage, has been a leading figure on the Trump administration’s Middle East policy. She is leaving after fulfilling her full-year commitment, the Washington Post says.

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Image of the Day

Local diver Nadim Samir did his part this week by saving a sea turtle from death by plastic. Samir was on a boat trip in the Red Sea when he happened upon a Pacific Green turtle with a plastic bag snared around its head and body, Egypt Today says. Apparently, turtles mistake plastic bags for jellyfish — one of their favourite foods.

Egypt in the News

Leading the conversation on Egypt in the foreign press this morning was the recent discovery of two c. 3,500 year-old tombs in Luxor. The Antiquities Ministry announced yesterday that the two tombs, which date to the 18th Pharaonic dynasty and are believed to belong to Ancient Egyptian nobility, were found near the west bank of the Nile containing a mummy, wooden coffins and funerary masks, clay vessels, and 450 statues.

The flow of foreign funds into Egypt through international loans, FDI, and bond issuances is a double-edged sword that has stimulated the economy but could lead to a debt trap, Vafa Benham writes for Brown Political Review. “Since a significant portion of this debt is being used to service government deficits rather than long-term infrastructural investment, it is unclear whether the gamble will be worth it,” particularly if something were to spook investors and send the capital fleeing.

Human rights lawyer Ragia Omran was awarded the Franco-German Prize for Human Rights and the Rule of Law, The Associated Press reports. Omran won the award “for her work representing political prisoners and torture victims as well as advocating for women’s rights.” The German and French embassies in Cairo are presenting Omran the award today.

Other international highlights worth noting in brief:

  • France24 returns to Tahrir Square more than half a decade after the 2011 uprising to look at how much this “melting pot” of a space has changed over time.
  • Dahab is Egypt’s jewel of the Red Sea, Lerato Mogoatlhe writes for The Africa Report.

Worth Watching

Campo Santo are launching a new game set in Ancient Egypt. The plot for Valley of the Gods is based around a group of filmmakers exploring an Ancient Egyptian valley back in the 1920s, according to AV Club. The trailer offers a glimpse into the stunning visuals players can expect when the game hits the consoles in 2019. Ancient Egypt has been gaining traction as a video game setting, with Assassin’s Creed Origins’ highly-anticipated release taking place earlier this year (watch, runtime 2:36)

Diplomacy + Foreign Trade

An Egyptian business delegation was in Sao Paulo for the Egyptian-Brazilian Business Forum this weekend, where they met with members of the Arab-Brazilian Chamber of Commerce and federation of industries, the Brazilian Development Bank, and the Investment Development Authority, a Trade and Industry Ministry statement said. Discussions centered around boosting trade activities, especially now that the Mercosur FTA is in effect.

Energy

Electricity Ministry allocates land for Al Nowais’ USD 4 bn coal plant

The UAE’s Al Nowais has officially been allocated land for its USD 4 bn, 2,650 MW coal power station in Oyoun Mousa, Electricity Minister Mohamed Shaker tells Al Borsa. Al Nowais will receive the land on a right-to-use basis and sell electricity to the state at a price that is currently under negotiation, Shaker says. Al Nowais had agreed to lower its asking price after talks over the project reportedly reached an impasse in October. The company’s proposed tariff ranges from USD 0.058- 0.067 per kWh, officials tell the newspaper.

Enara to invest USD 1 bn in African countries with Chinese alliance

Enara Capital will be partnering up with a Chinese consortium to invest USD 1 bn in renewable energy projects in Africa over the next three years, CEO Sherif El Gabaly said. The projects will be funded under the World Bank’s financing framework for renewable energy projects in the region, under which Egypt has received c. USD 1.8 bn in funding. Reports on Wednesday said Enara was planning USD 680 mn-worth of renewable energy projects in 2018. The company is exploring Ethiopia, Zambia, Senegal, and Madagascar as potential locations for its upcoming projects.

Egypt signs WB’s zero routine flaring initiative

Egypt announced on Thursday it will sign on the “Zero Routine Flaring by 2030” initiative, the European Bank for Reconstruction and Development (EBRD) announced over the weekend. The initiative, introduced by the World Bank in 2015, “brings together governments, oil companies and development institutions who recognise that flaring is unsustainable from a resource-management and environmental perspective, and who agree to cooperate to eliminate routine flaring by no later than 2030.”

Lekela Power to reach financial close for Gulf of Suez wind farm in 2018

Lekela Power for New and Renewable Energy is expecting to reach financial close for its USD 400 mn, 250 MW wind farm in the Gulf of Suez sometime next year, Actis Partner Sherif El Kholy tells Al Borsa. Actis, an emerging markets equity player, owns 60% of Lekela. The project will mostly be funded through international financing institutions.

Infrastructure

Suez Canal to keep tolls for passing ships stable 2018

The Suez Canal Authority (SCA) will leave unchanged tolls stable for ships passing through the canal in 2018, SCA head Mohab Mamish told reporters on Thursday, Al Masry Al Youm reports.

Gov’t to re-issue tender for Ras Sudr airport “soon”

The government has decided to re-issue a tender “soon” to develop an airport and tourism resort in Ras Sudr, Civil Aviation Minister Sherif Fathy tells Al Mal. The initial tender reportedly failed because the government had demanded a USD 10k fee from investors looking to purchase the booklet of conditions for the tender, sources told the newspaper. Orascom Construction, Hassan Allam, Misr Italia, and Haddad Group had all initially expressed interest in the project but did not make bids once the tender was launched. Separately, Fathy said that Egypt is set to launch three new flight routes with African countries and begin operating six new airports, including the Katameya and West Cairo airports, at the beginning of 2018.

Basic Materials + Commodities

Government should monitor market for price increases after extending tariffs on steel rebar imports

The government’s decision to extend tariffs on steel rebar from China, Turkey, and Ukraine for five years should be accompanied with monitoring the domestic market to ensure producers do not gouge prices, a member of the Federation of Egyptian Industries says. The tariffs will reduce competition from foreign exporters and could drive producers to raise prices domestically, according to Ahram Gate. The tariff was first implemented in June to protect local manufacturers and set at 17% for Chinese steel, 10-19% for Turkish steel, and 15-27% for Ukrainian steel.

USD 9 mn agreement signed to import Indonesian coffee

El Hamdi Trading Group signed a USD 9 mn agreement with an Indonesian company to import coffee and other foodstuffs, Chairman Khalid Hamdi told AMAY. The products will be re-exported to other markets such as Libya and Morocco.

Al Ategahat to provide Supply Ministry with 100k tonnes of Sunflower oil

The Supply Ministry has reached a preliminary agreement with Sudan’s Al-Ategahat Al-Mtadeda Co. to purchase 100k tonnes of sunflower oil, the company’s Egypt Director Nasr Hamid, tells Al Borsa. Al Ategahat had signed an agreement with The Food Industries Holding Company in October to supply 45k tonnes of meat over two years.

Manufacturing

GLC to establish EGP 200 mn plastics and packaging factory

GLC Paints is looking to establish a EGP 200 mn plastics and packaging factory in 10 Ramadan City, CEO Mohamed Al Hout told Al Borsa. The 15k sqm factory will be financed by the company itself and is part of a strategy to tap into new export markets, including Ghana, Cote d’Ivoire, Kenya, and Morocco in order to grow its exports to USD 15 mn over the next two years.

Tourism

Four international firms bidding to develop natural protectorates

The Environment Ministry has received four offers from Korean, Swedish, German, and Chinese firms to manage and develop the Wadi El Rayan and South Sinai natural protectorates, Minister Khaled Fahmy tells Al Borsa. The ministry is waiting for the House of Representatives to approve the new protectorates law — which is currently before the House Energy Committee — before deciding on the offers, Fahmy said. Separately, Fahmy said the development of the Petrified Forest and Wadi Degla protectorates should be complete by early 2018.

Ukrainians visiting Egypt now eligible for e-visas

Visa applicants from Ukraine are among those now able to apply for travel authorization to Egypt online, Ukrainian news agency UNIAN reports. The USD 25 e-visa is “an alternative to visas that can also be purchased at checkpoints across Egypt’s state border,” Ukraine’s Foreign Ministry said, according to the news agency. Ukraine is one of 46 countries whose citizens are eligible for an e-visa. We had linked to an incorrect website last week in our coverage of the e-visa launch. Apparently, the correct website — https://www.visa2egypt.gov.eg — was not up and running at the time of the visa launch. H/t Nagah El M.

Telecoms + ICT

TE Data routers hacked in cyber attack

Hackers attacked TE Data’s servers on Thursday, disrupting internet services for scores of subscribers using the Huawei 532 modem, AMAY reports.

Other Business News of Note

45k feddans to be tendered under first phase of 1.5 mn feddans project

Al Reef Al Masry is planning to tender more land under the first phase of the state’s 1.5 mn feddans project before the end of December, Chairman Atter Hannoura tells Al Borsa. Around 45k feddans to the west of Minya in Upper Egypt will be offered up.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.7491 | Sell 17.8482
EGP / USD at CIB: Buy 17.73 | Sell 17.83
EGP / USD at NBE: Buy 17.69 | Sell 17.79

EGX30 (Thursday): 14,295 (-0.4%)
Turnover: EGP 745 mn (28% below the 90-day average)
EGX 30 year-to-date: +15.8%

THE MARKET ON THURSDAY: The EGX30 ended Thursday’s session down 0.8%. CIB, the index heaviest constituent closed down 0.5%. EGX30’s top performing constituents were Eastern Co up 1.4%; Abu Dhabi Islamic Bank up 1.4%; and Elsewedy Electric up 0.8%. Thursday’s worst performing stocks were Ezz Steel down 3.1%; Amer Group down 2.9%; and Egyptian Iron & Steel down 2.8%. The market turnover was EGP 745 mn, and foreign investors were the sole net sellers.

Foreigners: Net Short | EGP -55.5 mn
Regional: Net Long | EGP +26.2 mn
Domestic: Net Long | EGP +29.3 mn

Retail: 64.3% of total trades | 68.7% of buyers | 59.9% of sellers
Institutions: 35.7% of total trades | 31.3% of buyers | 40.1% of sellers

Foreign: 21.3% of total | 17.5% of buyers | 25.0% of sellers
Regional: 10.2% of total | 11.9% of buyers | 8.4% of sellers
Domestic: 68.6% of total | 70.5% of buyers | 66.6% of sellers

WTI: USD 57.36 (+1.18%)
Brent: USD 63.40 (+1.93%)
Natural Gas (Nymex, futures prices) USD2.77 MMBtu, (+0.33%, January 2018 contract)
Gold: USD 1,248.4 / troy ounce (-0.38%)

TASI: 7,085.51 (+0.85%) (YTD: -1.73%)
ADX: 4,276.93 (-0.79%) (YTD: -5.93%)
DFM: 3,393.46 (-0.03%) (YTD: -3.89%)
KSE Weighted Index: 393.84 (-0.03%) (YTD: +3.62%)
QE: 7,773.59 (-0.31%) (YTD: -25.52%)
MSM: 5,066.09 (-0.48%) (YTD: -12.39%)
BB: 1,267.39 (+0.19%) (YTD: +3.85%)

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Calendar

15 December (Friday): The Law Magazine’s Law Talks event, Zamalek palace, Cairo.

19 December (Tuesday): Village Capital’s Financial Health Competition: Middle East and Egypt (applications close 3 November)

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

29-30 January (Monday-Tuesday): Seamless North Africa, The Nile Ritz-Carlton, Cairo

12-14 February 2018 (Monday-Wednesday): Egypt Petroleum Show 2018 (EGYPS), New Cairo Exhibition Center.

19-20 February 2018 (Monday-Tuesday): The Banking Tech North Africa, The Nile Ritz-Carlton, Cairo

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

29 April – 1 March 2018 (Thursday-Sunday): Cityscape Egypt, Cairo International Convention Centre, Cairo

4-6 May 2018 (Friday-Sunday): International Conference on Network Technology (ICNT 2018), venue TBD, Cairo

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