Tuesday, 9 January 2018

It’s foreign policy day in Egypt: Pence is coming, and Cairo’s delicate East African dance continues

TL;DR

What We’re Tracking Today

Food for thought on this fine Tuesday morning, where we once again remind you that Egyptianwinters are the best winters in the world:

We’re basking in a relatively quiet news day. You should too. Hit the link here for our full 2018-19 holiday calendar. Then get a fresh cup of coffee, close your door and sit back to figure out what it means to your business (and your holiday plans). As you do, keep in mind the words of reader Davide C., who reminded us as 2017 drew to a close that Egypt took 17 national holidays last year — making us the country with the fifth-highest number of vacation days in the world. How good is that for productivity? By his calculations, Italy — our Mediterranean sibling from another mother — had an average of 9.4 national holidays over the past five years (they don’t get ‘replacement days’ if they fall on a weekend). That means we work one and a half weeks less each year than the Italians do — or two and half weeks less if you presume everyone in the country drops down to a six-hour workday for Ramadan.

And if you, like us, are the type who will spend the next month or so figuring out and refining your list of business and personal goals for 2018 and into 2019, go read Andrew Hill’s latest Managing Yourself column for the FT. It’s a short hit that urges us all to do less this year, but do it better. The column rides on the work of Norwegian academic Morten Hansen, whose blog won our hearts with stories including “Cut Your Work in Half This Holiday Season: Do a George Costanza.” Anyone who can reference Seinfeld can’t be all bad, right? Hansen is the author of the forthcoming “Great at Work: How top performers do less, work better and achieve more,” which is due out at month’s end — and which we have just pre-ordered. (And yes, we’re very aware that one way to do less, work better and achieve more is probably to spend less time reading modern-day self-help books…)

Why are we so chipper this morning? All the good news in yesterday’s edition (here, here and here) has us upbeat, sure, but we were also reminded overnight by the New York Times columnist Nicholas Kristof that 2017 was the best year in human history. Set aside everything that’s easy to hate in this day and age, he reminds us, and embrace the fact that “a smaller share of the world’s people were hungry, impoverished or illiterate than at any time before. A smaller proportion of children died than ever before. The proportion disfigured by leprosy, blinded by diseases like trachoma or suffering from other ailments also fell.”

Meanwhile: Expect foreign policy to dominate today’s news cycle as Egypt engages with the United States (the Pence visit is back on) and our neighbors in Sudan (which is stirring the pot on Halayeb), Eritrea (whose president is here today) and Ethiopia (GERD, which continues to give us GERD). We have a full rundown at the head of today’s Speed Round, below.

In other headlines worth a moment of your attention today:

Let them eat cake: In a nation as obsessed with food security as we are and should be, surely there are opportunities in agricultural technology — or agtech as it’s now known. The FT tells us that fundraising for the sector more than doubled last year (admittedly to a still-paltry USD 700 mn).

Quant funds will soon have more than USD 1 tn in assets under management, according to the salmon-colored paper.

How much do you know about fintech, which looks to be one of the themes of the year in Egypt’s banking sector as the central bank pushes financial inclusion? Beginners should take the Wall Street Journal’s cute little quiz and find out.

Offspring of Almarai founder in jail? The sons of Almarai dairy founder and chairman Sultan bin Mohammed Al Kabeer are among the 11 princes arrested last week for complaining about rising utilities prices, Bloomberg claims.

Business woman and entertainer Oprah Winfrey is said to be “actively considering” a 2020 bid for the White House after her widely applauded speech at the Golden Globes on [redacted] harassment this week, CNN reports. The story is front page news everywhere from the Financial Times to the New York Times, with the latter also throwing in an op-ed on why a run would be a bad idea in the Age of Trump.

What We’re Tracking This Week

The Federation of Egyptian Industries (FEI) and the House Industrial Committee will discuss proposed amendments to the Public Procurement Law on Wednesday, Al Borsa reports. The law grants Egyptian products preferential treatment in government contracts and promotes local industry. The FEI will push to reduce the minimum quota of Egyptian products used in national projects from the 40% level currently demanded, saying local producers just can’t meet demand, member Abdel Moneim El Kady tells the newspaper.

On The Horizon

The 2018 calendar of investor conferences gets underway next week. First up, our friends at EFG Hermes will host their annual Egypt Day, which gets underway next Monday at the Four Seasons Nile Plaza. Last year’s event saw institutional investors with more than USD 3.5 tn in assets under management attend President Abdel Fattah El Sisi met with last year’s gang, while CBE Governor Tarek Amer and other members of the Ismail cabinet’s economic group also gave investors face time. This year’s event will begin with the firm’s annual CEO dinner.

The following week will see Arqaam Capital hold its Egypt Investors Conference 2018 on 22 January. The conference will host senior C-Suite executives from some 20 listed Egyptian companies for one-on-one meetings at the Vineyard Hotel, Cape Town, South Africa.

Enterprise+: Last Night’s Talk Shows

The expected hike in railway ticket prices led the conversation on the airwaves last night.

Masaa DMC’s El Hosary also spoke to Transport Minister Hisham Arafat, who said that holding off until 2019 to raise railway ticket prices is not feasible. The price hikes are crucial to fund maintenance works worth EGP 55 mn and renovations to improve the quality of service, Arafat said. The minister also said that it’s important to take advantage of the overall push for reform to reverse the effects of corruption on the national rail system, which has been accumulating debt over the past several decades (watch, runtime: 8:44).

Arafat further skirted the issue of timing on the hikes on Hona Al Asema, telling host Lamees Al Hadidi that the ministry has yet to decide when the ticket prices will be hiked, but it will be “soon.” The railway sector currently has a budget deficit of around EGP 2 bn, and there are currently studies underway to determine how much ticket prices must be hiked to bridge the financing gap (watch, runtime: 10:00). Arafat elaborated on the pricing further in statements earlier in the day which we cover in the Speed Round.

Trade and Industry Minister Tarek Kabil phoned in to state that the total value of Egypt’s exports in 2017 rose to EGP 22 bn, a 12% y-o-y increase, while imports declined by around 30% y-o-y. Kabil also told Lamees that the industrial sector is steadily growing, and currently accounts for 18% of Egypt’s GDP. To support that growth, the government has allocated large land plots for industrial companies, and is working with the Armed Forces’ Engineering Authority to design and construct 13 industrial complexes in 12 governorates (watch, runtime: 9:29).

Lamees also sat down with Saudi businessman Hussein Shobokshi, who had a glowing forecast for Egypt’s economic growth in 2018. The improvement of business conditions has boosted investors’ confidence in the Egyptian market, which has significant potential to become a hub for manufacturing and exporting products to the MENA region and Africa (watch, runtime: 12:27).

Shobokshi discussed with Lamees the economic reforms Saudi Arabia is currently undertaking, noting that this is part of the government’s preparation for the post-oil era to ensure that the country’s economic resources remain intact. He also said that the kingdom and other Gulf countries are moving towards increased reliance on sustainable and renewable energy sources (watch, runtime: 19:48).

Kol Youm’s Amr Adib took note of several national projects inaugurated by President Abdel Fattah El Sisi in 10 Ramadan City yesterday. Adib said that the government is exerting significant effort into its projects, most notably the laundry list of social housing projects presented by Housing Minister Moustafa Madbouli, but citizens don’t seem to feel the effect of these projects (watch, runtime: 4:10).

Speed Round

Speed Round is presented in association with

It’s going to be a day of foreign policy headlines in Egypt, if a spate of news yesterday and overnight is any indicator:

US Vice President’s Middle East tour is back on this month: US Vice President Mike Pence’s delayed Middle East tour of Egypt, Jordan and Israel is back on for later this month, the White House announced on Monday. Pence will kick-off the tour in Egypt on 20 January, where he will meet with President Abdel Fattah El Sisi, reads the statement. The tour will “address the shared need to combat terrorism and assist persecuted religious minorities,” the White House says, but you can also expect the US recognition of Jerusalem will play in talks when Pence meets El Sisi, Jordan’s King Abdullah and Israeli Prime Minister Benjamin Netanyahu. US President Donald Trump unnecessarily stirred up a hornet’s nest last month when he followed his Jerusalem announcement by saying he would cut US funding to United Nations Relief and Works Agency for Palestine if the Palestinians do not go back to the negotiating table. Pence, a strong supporter of Trump’s decision on Jerusalem, will also visit the city’s Western Wall and give a speech at the Israeli parliament. A number of Egypt’s religious figures, including Pope Tawadros and the head of Al Azhar, have announced they will not meet with Pence in protest of the Jerusalem decision.

Meanwhile, Eritrean President Isaias Afwerki arrives in Cairo today to meet with President Abdel Fattah El Sisi, Al Masry Al Youm reports. The two presidents will almost undoubtedly look into the impasse between Egypt, Sudan and Ethiopia over the Grand Ethiopian Renaissance Dam (GERD) and the wider regional Cold War which appears to have drawn in Ethiopia’s main regional rival Eritrea. Afwerki and his accompanying delegation will also sit down today with Foreign Minister Sameh Shoukry and General Intelligence Directorate head Khaled Fawzy. Afwerki arrives after Sudan closed its border with his country — and after an unconfirmed report that Egypt has sent troops to his nation with UAE backing, as we noted yesterday.

As for Ethiopia, the country has yet to respond to Egypt’s proposal to include the World Bank in GERD negotiations as an impartial third party, Foreign Minister Sameh Shoukry said yesterday, Al Mal reports. Shoukry had initially presented the suggestion during a visit to Addis Ababa last month in hopes of resolving the impasse between Egypt, Sudan, and Ethiopia after the latter two countries refused to ratify the results of environmental impact studies on the dam. The World Bank reportedly gave a preliminary nod to the suggestion last week, and will reach a final decision this month. Egypt is committed to avoiding tension over the negotiations, which are currently focused on the technical aspects of the dam, Shoukry reaffirmed.

It’s against that backdrop that El Sisi said yesterday that Egypt is taking preemptive steps to ensure it does not end up facing a water crisis. The president made the remarks at an inauguration ceremony for several projects, including a water treatment plant. El Sisi announced that in addition to capitalizing on its share of Nile water, Egypt is working on water treatment and desalination projects worth EGP 70 bn to ensure consumption needs are being met, an Ittihadiya statement says.

All of this comes as Sudan renewed yesterday its complaint to the UN Security Council, once again claiming it has sovereignty over Egypt’s Halayeb triangle, the Sudanese Foreign Ministry said in a statement. It remains unclear whether the complaint calls on the council to take any action against Egypt, whose membership in the council expired at the end of 2017. Tensions have been rising between Khartoum and Cairo for several months over Omar El Bashir’s government using the GERD talks to push its claim to the Halayeb Triangle. Playing the Halayeb card is also a useful tool for Khartoum to detract attention from ongoing bread riots. Sudan withdrew its ambassador to Egypt last week for “consultations,” as we noted yesterday.

Elections committee announces timetable for 2018 presidential poll: The National Elections Committee (NEC) announced yesterday at a press conference that Egyptians will head to the polls to elect a president on 26-28 March, Al Masry Al Youm reports. Egyptians abroad will cast their ballots roughly a week earlier, over a three-day period. Candidates must register between 20 and 29 January. In the event of no single candidate wins a majority the first time around, a runoff will take place 24-26 April, commission head Lasheen Ibrahim said. First round results will be announced on 2 April. In the event of a run-off, the final results will be announced on 1 May.

Ibrahim also announced the conditions by which foreign observers will be allowed to monitor the elections, according to Al Shorouk. Observers will be allowed to monitor polling stations for a period of no more than half an hour, which can be reduced by NEC supervisors if deemed necessary. Polling stations can only be observed once, according to a decision by the committee. Organizations and civil society groups must apply at the election’s online portal of www.elections.eg between 15 and 19 January. Organizations must have had prior experience monitoring elections in other countries.

The global press is not over the Shafik circus: The international press has already begun casting doubt on the elections, in no small measure thanks to the media circus and antics of former Civil Aviation Minister and bench-warmer Prime Minister Ahmed Shafik. The announcement of the schedule comes just one day after Shafik announced he would not run. Even his withdrawal continues to draw controversy as his lawyer told the New York Times that the decision came as a result of pressure from the government. This statement was quickly denied by members of Shafik’s political party, which said that the announcement was made “with complete conviction,” Al Bawaba reports. The rest of the international press, including Bloomberg and Reuters, focused on the slim chances of potential candidates other than President Abdel Fattah El Sisi, including lawyer Khaled Ali whose, bid may be tossed out if he loses an appeal of his conviction of engaging in lewd public gesture.

What about local elections? The House of Representatives will vote on the Local Administration Act, which establishes elected local councils, before the summer recess, House Speaker Ali Abel Aal said, according to Al Mal.

LEGISLATION WATCH- The House of Representatives’ winter agenda includes legislation on new pharma regulator, ride-hailing apps, cybercrimes, victims of terrorism, quota for women in the judiciary, among others, according to stories out yesterday.

Law establishing new pharma sector regulator with cabinet next week: A draft law establishing a regulator for the pharma sector will make it to the Ismail cabinet’s meeting next week, Health Minister Ahmed Rady said on Monday, according to Al Borsa. “The law would set out to fix some of the glaring issues with the pharma sector,” Rady had said without diving into specifics. Plans for Pharma Regulator Act had been in the works since early in 2016, with the House of Representatives’ Healthcare Committee announcing that year that it was drafting a bill to establish a new market regulator at a time of widespread reports of meds shortages. At the time the committee had said that the regulator will have wide ranging authority over the industry, including responsibility for quality control and distribution policies as well as exports.

The proposed regulator would be an independent agency reporting to cabinet and not the Health Ministry, according to an earlier draft. The law is being drafted by the ministries of health and justice “with input from industry experts.”

Laws trickling out of State Council after reviews: In other legislative news, the Council of State (Maglis El Dawla) has completed its review of the Ride-hailing Apps Act and the Cyber Crimes Act ahead of their being introduced in the House of Representatives, council sources tell Al Borsa. Both laws await final sign-off by the Ismail cabinet as early as today before going on the agenda in the House. As we noted last month, a number of industry sources have complained that the Ride-hailing Apps Act would disrupt the industry (and not in a good way) by ensuring that half of the fleets of apps such as Uber and Careem be made up of white taxis, imposing a licensing pricing scheme that favors taxi drivers, while allowing only a six-month compliance period. The Council also completed reviewing a law that would set up a fund to care for the victims of acts of terrorism.

Meanwhile, the House of Representatives approved in a plenary session amendments to the Agriculture Act that toughen sanctions for misuse of agricultural land. Under the changes, those who use agricultural land for non-agriculture developments could see jail time of up to two years and fines of up to EGP 50,000, according to Al Masry Al Youm.

And in a surprisingly enlightened move, House Speaker Ali Abdel Aal referred to committee a draft law that would set a quota for the appointment of women to the judicial branch of government, Al Shorouk reports.

M&A WATCH- French appliances manufacturer Groupe SEB announced that it is partnering with Egypt’s Zahran Group to merge their electrical appliances and cookware businesses in Egypt, the company announced in a statement on Monday (pdf). Groupe SEB hopes the new entity, Groupe SEB Egypt Zahran, will help strengthen and grow its local manufacturing base and export sales. Groupe SEB will hold a 55% in the new JV, while Zahran will hold a 45% stake. Both companies had set up Groupe SEB Egypt back in 2013 to produce and sell small electrical appliances primarily under the Moulinex and Tefal brands. Beltone Financial and Zaki Hashem and Partners advised Zahran Group on the transaction, which is still awaiting regulatory approval, while Crédit Agricole Corporate and Investment Bank and Matouk Bassiouny served as advisors to Groupe SEB.

Egypt is forecast to be one of the world’s top two exporters of oranges for the 2017-18 season, according to an excellent report by the United States Department of Agriculture (pdf). The report has Egypt in second in a worst case scenario, even though in terms of production we are ranked sixth. Egyptian exports are finding traction on the back of increased competitiveness post-devaluation of the EGP. Egypt exports roughly 50% of its orange production and is rivaled only by Spain in its bid for the world number one slot. Spanish exports for the season are contingent upon its production capacity, which could be hindered by a drier season. The top importers of Egyptian oranges are expected to be Russia, Saudi Arabia, the Netherlands, and China. Citrus exporters have recently been vocal on their expectations for a good season.

Talaat Moustafa Group Holdings announced what it says are its highest sales since 2008, saying in a note sent to the bourse that sales for 2017 clocked in at EGP 13.11 bn. The sales figure shows a 100.1% increase from 2016’s tally of EGP 6.55 bn. TMG says the sales figure is the largest since 2008 and includes EGP 3.63 generated from commercial and administrative sales.

In other news from the sector, the master plan for Taj City has received approval from the Prime Minister’s office, Madinet Nasr Housing and Development (MNHD) announced. The approval allows the company to launch the non-residential components of the Taj city project, including a hotel area, MNHD says.

Next round of PPP school tenders to be launched this month with only four remaining bidders: The government plans to announce the next stage of the tender to develop and run 200 public-private partnership schools this month, sources tell Al Borsa. Four companies had qualified to submit their financial offers for the schools, including Middle East Education Services Group and a joint bid from Egypt’s Gezira Academy and Saudi Arabia’s Madinat Al Oloum. Offers are expected to be reviewed this week by state-owned investment bank NI Capital. We noted back in October that 10 companies had submitted bids, but a number of major players had backed out of the key project, including arms of Orascom Construction, Carillion and BPE Partners.

The Transport Ministry plans to hike railway tickets by 20-25% and will also raise prices on shorter train runs, minister Hisham Arafat announced yesterday. The short-distance train routes are the biggest drain of resources at Egyptian National Railways, Arafat said, explaining that the price hikes will help support upgrades and new railway projects that will cost north of EGP 52 bn by 2022. ENR’s budget deficit is also widening, with its revenues hovering around EGP 2.2 bn against expenditures of EGP 5.5 bn. While the minister did not give a time frame for the planned price hikes, he had said last month that they would be implemented by the end of June.

The electricity and environment ministries have reportedly agreed to set the feed-in tariff for waste-to-energy projects at EGP 1.30 per kWh produced from agricultural waste and EGP 1.60 per kWh produced from solid waste, unidentified sources tell Al Mal. The Environment Ministry is looking to pay EGP 1 per kWh and have the Finance Ministry cover the remaining costs, the sources say. Government sources had alleged in November that the Electricity Ministry set EGP 1.35 per kWh as the maximum FiT for WtE projects. Earlier reports had emerged that the Ismail Cabinet was looking to set a three-tier tariff system, with the highest rate being EGP 1.60 per kWh.

CORRECTION-Ali Okda was appointed CEO of Travco Travel Company of Egypt, not Travco Group as we noted yesterday. We’ve corrected the entry on our website. H/t Yara S.

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Egypt in the News

2018 begins on a high note for Egypt, with record number of tourists visiting Luxor, flights with Russia resumed, and the inauguration of the Zohr gasfield, Gavin du Venage writes for The National. “From a macroeconomic perspective, things are looking up for Egypt, and the reform programme it has embarked on seems to be paying off,” Mohamed El Dahshan, an economist with the Tahrir Institute, tells du Venage.

The Zohr gas field has signaled that the eastern Mediterranean has significant gas resources, but their development is being hindered by geopolitical rivalries, Andrew Ward writes for the Financial Times (paywall). A major part of the challenge is setting up the pipelines that would allow any gas developed in the region to reach international markets. Italy and Israel are considering a possibly unviable pipeline via Cyprus and Greece, in order to avoid setting up a pipeline via Turkey, which would have to pass through Lebanese and Syrian waters. Egypt, however, is going to have a much easier time exporting LNG to Europe and Asia through two terminals in the Suez Canal. “The incentives for co-operation are strong but so too are the barriers. As Egypt reaps the rewards of Zohr, its neighbours face difficult choices if they are to unlock the full energy potential of a region that has mixed commerce and conflict for millennia.”

Also worth noting in brief this morning:

  • Only President Abdel Fattah El Sisi is so far a potential contender in this spring’s presidential poll, Tarek El Tablawy writes for Bloomberg.
  • The best way to resolve the Nile issues is via co-operative development through the whole basin, Robin Mills writes for The National.
  • The UN condemned the hanging of 20 sentenced to death on terrorism charges, VOA reports. Their cases were tried in military courts.
  • An Egyptian national was arrested and detained in Ireland following the stabbing death of one man and injuries inflicted on two others, according to The Associated Press. The police say they have found suggestion the attacks were terror-related, according to RTE.
  • Rwandan outfit KT Press profiles an Egyptian couple who arrived in the country as doctors sent by the Egyptian government in 2009 and decided to stay and set up practice there.
  • The recently-enacted NGOs law has significantly affected cultural life in Egypt by restricting cultural NGOs, The Art Newspaper says.

On Deadline

The nation’s columnists are focused on Ahmed Shafik’s withdrawal of his candidacy and what it means for this year’s presidential elections. Shafik’s candidacy should never have been taken seriously, especially due to the bizarre circumstances surrounding it and the unconvincing reasons he gave for withdrawing, says Al Masry Al Youm’s Soliman Gouda. Regardless of his intentions, the criticism Shafik faced during his short-lived bid just goes to show that Egypt’s political environment is not receptive to the concept of challenging the status quo, Tarek El Shenawy says in the same paper. But what Shafik’s detractors fail to realize is that having a pluralistic election is actually in everyone’s favor, Al Shorouk’s Mohamed Esmat points out. Meanwhile, Youm7’s Asmaa Moustafa says that there are no viable alternatives to incumbent President Abdel Fattah El Sisi, and that his critics should offer serious competitors rather than criticize his policies.

Worth Watching

Black Mirror returns stronger than ever with a shorter, more meaningful season: Black Mirror Season 4 was the best gift Netflix gave us this Christmas season. The fourth round of this through-the-looking-glass, tech-focused anthology series takes us down some even murkier moral and existential routes than last season, exploring everything from sentient AI, surveillance and psychological torture to a masterful addressing of race. Those who have not yet checked out the season wasted a significant portion of their New Year’s break. Those who have yet to hear of the series might as well just cancel their Netflix subscriptions now and be done with television altogether.

Worth Reading

Enterprise Book Club presents: Valiant Gentleman. When we weren’t melting out brain cells by watching others do the same on Black Mirror, some of us proudly took the time to indulge in some reading this holiday season — masochists that we are after a year of reading news. Among the gems recommended to us was Sabina Murray’s Valiant Gentlemen, a riveting piece of historical fiction on Irish humanitarian and revolutionary Sir Roger Casement and his friendship with his foil the British sculptor Herbert Ward. Whether it is read as a colorful adventure novel or political treatise, the draw in this long read is the intensity of the characters and their moral convictions that take them down widely varying and tragic fates. Be warned: The gruesome acts depicted here cast a very grim view of empire in the early 20th century. A lot of sleepless nights with this one.

Diplomacy + Foreign Trade

Foreign Minister Sameh Shoukry met with Ireland’s Foreign Affairs and Trade Minister Simon Coveney in Cairo yesterday to discuss developments in the Palestinian-Israeli crisis, and Shoukry relayed Egypt’s vision and efforts to resolve the issue, according to a ministry statement. Coveney is heading to Ramallah and Tel Aviv after his trip to Cairo concludes tomorrow. Shoukry and Coveney also discussed bilateral ties and prospects for Irish investments in pharmaceutical production, renewable energy, and ICT.

Energy

ACWA Power reaches financial close for three solar power plant projects in Benban

ACWA Power announced it reached financial close for three solar PV power plant projects under the second round of the feed-in tariff program. The three projects have a total capacity of 165.5 MW at a total investment value of USD 190 mn. 75% of the project cost is financed through a non-recourse project debt from European Bank for Reconstruction and Development and Industrial and Commercial Bank of China. The remaining 25% will be coming through equity capital from the sponsors. Construction of the projects will begin in 1Q2018 and are set to begin operations by 4Q2018.

Infrastructure

56% of the country has access to sewage networks, Madbouli

Only 56% of the country has access to sewage networks, Housing Minister Moustafa Madbouli says, according to Al Mal. The rate in rural villages drops to 26% but 94% of cities are covered, he says. Madbouli added that 97% of the country has access to potable water.

Basic Materials + Commodities

Domty denies freezing investment, says Rwanda expansion moving ahead

Domty denied circulated reports that it is halting investment plans and says it is moving ahead with planned expansion, according a bourse disclosure. The company’s plan to set up a branch in Rwanda is progressing, Domty says. It also adds that, domestically, it is launching a bakery line by the end of 1Q2018 as well as new dairy products, including flavored milk, during the year.

Researchers develop compound that strengthens wheat against arid conditions

Researchers at the National Research Center have developed a genetically modified compound that allows wheat to grow more efficiently in arid conditions, according to the Genetic Literacy Project. The compound reduces the strain on wheat by concentrating the grain’s protein and carbohydrates content, while strengthening it against disease. This potential scientific breakthrough is apparently caught up in our typical Egyptian legal quagmire. While a patent has been issued for the compound, the manufacture of genetically modified goods remains illegal. Legislation governing such items has been proposed but hasn’t moved forward in parliament.

Banking + Finance

Arabian Cement reschedules USD 30.9 mn loan

Arabian Cement announced receiving approval to reschedule a USD 30.9 mn loan from National Bank of Egypt, according to a bourse disclosure. The company will now repay the loan over 15 quarterly installments of USD 2 mn at an interest rate of LIBOR+5%. Arabian Cement says the loan will be repaid fully by 1 July 2021.

ARCO secures EGP 1 bn loan from Arab African

Al Arabia Company For Real Estate Development (ARCO) has secured an EGP 1 bn loan from Arab African International Bank, according to statements from Sarie Eldin & Partners Legal Advisors, who advised on the loan. The loan will go toward financing ARCO’s new urban development projects, the firm said on Monday in a statement picked up by Al Mal..

Other Business News of Note

FEP Capital to set up EGP 350-400 mn private equity fund to invest in startups

FEP Capital plans to establish a EGP 350-400 mn private equity fund to invest in startups, CEO Mahmoud Khalifa says, Al Mal reports. This fund is separate from another USD 100 mn fund FEP Capital plans to set up for investments in the food, health, and education sectors and idle factories.

GAFI approves Arab Cotton Ginning Company demerger

The General Authority for Freezones and Investment (GAFI) approved on Thursday the Arab Cotton Ginning Company’s demerger into two separate companies, the company announced yesterday in a statement to the bourse (pdf).

Egypt Politics + Economics

Two policemen held following death of prisoner

Two policemen are being held after the death of a detainee in a Mokattam police station, unnamed officials told the AP. The death sparked protests outside of the prison and 43 protesters were arrested. Prosecutors are holding the policemen for 24 hours and the protesters for at least 15 days.

On Your Way Out

Businessman Nader Riad has set up street libraries around Cairo, according to TRT World. The premise is modeled on the Little Free Library system: Set up a few cabinets to serve as book shelves and ask the public to stock them with books they don’t need. The libraries then run on an exchange system where people place a book before taking one that they want and the libraries become automated. In a city as big as ours, there is bound to be at least a few dozen books being hoarded, and Riad is hoping to get them into his street libraries. Three of them have been established so far with more coming over the next few months (watch, runtime 2:27).

The Market Yesterday

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EGP / USD CBE market average: Buy 17.6456 | Sell 17.7456
EGP / USD at CIB: Buy 17.63 | Sell 17.73
EGP / USD at NBE: Buy 17.65 | Sell 17.75

EGX30 (Monday): 14,953 (+1.2%)
Turnover: EGP 1.3 bn (20% above the 90-day average)
EGX 30 year-to-date: -0.4%

THE MARKET ON MONDAY: The EGX30 ended Monday’s session up 1.2%. CIB, the index heaviest constituent closed up 3.2%. EGX30’s top performing constituents were Abu Dhabi Islamic Bank up 3.4%; Palm Hills up 3.4%; and CIB up 3.2%. Yesterday’s worst performing stocks were EFG Hermes down 5.1%; Pioneers Holding down 2.2%; and AMOC down 1.5%. The market turnover was EGP 1.3 bn, and local investors were the sole net sellers.

Foreigners: Net Long | EGP +221.7 mn
Regional: Net Long | EGP +18.4 mn
Domestic: Net Short | EGP -240.2 mn

Retail: 52.6% of total trades | 46.5% of buyers | 58.8% of sellers
Institutions: 47.4% of total trades | 53.5% of buyers | 41.2% of sellers

Foreign: 25.9% of total | 34.7% of buyers | 17.0% of sellers
Regional: 14.4% of total | 15.1% of buyers | 13.6% of sellers
Domestic: 59.8% of total | 50.2% of buyers | 69.4% of sellers

WTI: USD 61.86 (+0.68%)
Brent: USD 67.87 (+0.37%)
Natural Gas (Nymex, futures prices) USD 2.82 MMBtu, (+0.93%, February 2018 contract)
Gold: USD 1,319.8 / troy ounce (-0.19%)

TASI: 7,310.26 (-0.1%) (YTD: +1.16%)
ADX: 4,585.54 (+0.64%) (YTD: +4.25%)
DFM: 3,490.16 (+0.55%) (YTD: +3.56%)
KSE Weighted Index: 409.81 (-0.38%) (YTD: +2.09%)
QE: 8,975.82 (+2.57%) (YTD: +5.31%)
MSM: 5,107.97 (-0.22%) (YTD: +0.17%)
BB: 1,320.4 (+0.12%) (YTD: -0.85%)

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Calendar

15-17 January (Monday – Wednesday): EFG Hermes Annual Egypt Day Conference, Four Seasons Nile Plaza, Cairo

15 January (Monday): EFG Hermes Annual Egypt CEOs Dinner, Four Seasons Nile Plaza, Cairo

22-23 January (Monday-Tuesday): Arqaam Capital Egypt Investors Conference 2018, The Vineyard Hotel, Cape Town, South Africa.

25 January (Thursday): 25 January revolution / Police Day, national holiday.

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

30 January-01 February (Tuesday-Thursday): CI Capital’s MENA Investor Conference, Four Seasons Nile Plaza, Cairo.

05 February (Monday): Egypt’s Emirates NBI PMI reading for January announced.

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.

05-07 March (Monday-Wednesday): EFG Hermes’ One on One Conference 2018, Atlantis, The Palm, Dubai, UAE.

28-31 March 2018 (Thursday-Sunday): Cityscape Egypt, Cairo International Convention Centre, Cairo

08 April (Sunday): Easter Sunday, national holiday.

09 April (Monday): Sham El Nessim, national holiday.

24-25 April (Tuesday-Wednesday): Renaissance Capital’s 3rd Annual Egypt Investor Conference, Cape Town, South Africa.

25 April (Wednesday): Sinai Liberation Day, national holiday.

01 May (Tuesday): Labour Day, national holiday.

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

15 May (Tuesday): Expected date for the start of Ramadan begins (TBC).

15-17 June (Friday-Sunday): Eid Al Fitr (TBC), national holiday. (Look for possible Monday off given the first day falls on a Friday.)

21-25 August (Tuesday-Saturday): Eid Al Adha (TBC), national holiday

11 September (Tuesday): Islamic New Year (TBC), national holiday.

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

20 November (Tuesday): Prophet’s Birthday (TBC), national holiday.

22 November (Thursday): US Thanksgiving.

25 December (Tuesday): Western Christmas.

01 January 2019 (Tuesday): New Year’s Day, national holiday.

07 January 2019 (Monday): Coptic Christmas

25 January 2019 (Friday): Police Day, national holiday.

25 April 2019 (Thursday): Sinai Liberation day, national holiday.

29 April 2019 (Monday): Easter Monday, national holiday.

01 May 2019 (Wednesday): Labor Day, national holiday.

06 May 2019 (Monday): First day of Ramadan (TBC)

05-06 June 2019 (Wednesday-Thursday): Eid El Fitr (TBC)

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