Sunday, 14 January 2018

Cabinet shuffle at noon today; Ismail expected to remain in office until after spring presidential poll

TL;DR

What We’re Tracking Today

Welcome to another very busy news day, ladies and gentlemen.

All signs point to a (minor?) cabinet shuffle today. The House of Representatives is set to vote at noon today on a presidential decree ordering a limited Cabinet shuffle. Parliamentary Speaker Ali Abdel Aal is reported to have called an emergency session of the House’s general assembly, where an absolute majority must approve the shuffle for it to pass, Al Masry Al Youm reports. Quorum for the gathering will be one-third of all members.

Who’s in and who’s out? The rumor mill was in overdrive this weekend, with conflicting reports suggesting that ministries ranging from agriculture, irrigation, and health to finance and investment could be getting new bosses. A source in government tells Al Masry Al Youm that while the initial list included changes to the Cabinet economic group, the final decision was to keep these ministers in place to maintain policy stability. Speculation elsewhere is that the tourism, youth and sports, local development, manpower, and culture ministers will be getting the boot.

Don’t expect Sherif Ismail to go into retirement just yet, the pundits say. The PM is believed to have returned to Egypt on 21 December after having sought medical treatment in Germany, but has yet to attend a cabinet meeting. Moustafa Madbouli remains acting prime minister and has denied having been tapped to form a new government, telling Al Mal that his role as head of Cabinet remains temporary.

But don’t expect him back at work soon: Sources told Al Masry Al Youm that Ismail will not soon be returning to work soon, as had previously been claimed.

The word from on high: State-owned Al Ahram reports that three ministries will get new leaders and that Ismail will not be among those replaced. Al Shorouk quotes deputy House speaker Suleiman Wahdan as saying much the same thing, noting that under the constitution, replacing Ismail would effectively require the government to be dissolved and for the House to approve the new PM’s agenda. MP Mostafa Bakry tells Youm7 much the same thing, saying a new government this close to the presidential elections isn’t desirable. Ismail has been PM since September 2015; nine ministers were swapped out in the last cabinet shuffle, which took place this past February.

The bottom line: Be ready for anything. While the steer from officialdom is for a limited shuffle, the domestic press is notorious for bad reporting on expected changes to cabinet lineups. Already, the talking heads on TV last night speculated that the shuffle would see anywhere from three to five new faces around the cabinet table this week. We have more in Last Night’s Talk Shows, below.

Ethiopian Prime Minister Hailemariam Desalegn arrives in Egypt today for a three-day visit, during which he will meet with President Abdel Fattah El Sisi, unidentified sources tell Al Masry Al Youm. The visit comes after Cairo proposed including the World Bank in tripartite negotiations over the Grand Ethiopian Renaissance Dam (GERD). Desalegn was expected to visit Egypt last month, but his trip was postponed. It remains undecided whether he will address the House of Representatives, according to the sources, despite this previously being announced as the main feature of his visit. Some expect Desalegn’s visit to be a turning point in stalled negotiations between Cairo and Addis over the dam, particularly as negotiations have been ongoing to end the two countries’ disagreements over the dam’s impact studies, sources tell Al Shorouk.

Meanwhile, reports suggest Khartoum has no plan to de-escalate tension with Egypt. Sudan’s ambassador to Egypt, Abdel-Mahmoud Abdel-Halim, reportedly said on Friday that he was recalled last week in one of a series of moves that could include “withdrawing of ambassador or expulsion of other country’s ambassador or breaking off the relationship and declaring war,” Sudan Tribune reports. Sudan’s Foreign Ministry later denied Abdel-Halim made the remarks, — even though Sudan Tribune claims they were made in a brief to journalists, according to Al Masry Al Youm.

Oil quietly topped the USD 70 barrier on Thursday for the first time in three years, Bloomberg notes.

If anyone harbored illusions that The Donald wasn’t a racist… The Donald woke up on Thursday and decided it wasn’t enough to insult the developing world with policy alone. At a meeting at which he rejected a compromise on immigration reform, Trump is reported to have questioned why the US would accept more immigrants from Haiti and “[redacted] countries” in Africa rather than places like Norway. African leaders are up in arms.

Further afield this morning, a number of readers forwarded us yesterday links to Parents’ Dilemma: When to Give Children Smartphones from the Wall Street Journal. The crux of it: “When to allow children a smartphone has become among the most pivotal of parental decisions in the decade since Apple Inc.’s iPhone remade daily habits. For many families, the choice is as significant as when to hand over the car keys. It pits parents and teachers against some of the largest and most advanced companies in the world—a fight as lopsided as it sounds. The Journal’s service piece comes after what some have called a “week of soul searching” for big tech.

How to Succeed in Business? Do Less. After getting ink last week in Andrew Hill’s FT column, Morten Hansen crosses the Atlantic with an excellent piece for the Wall Street Journal that should be required reading for all C-suite officers, folks dreaming of building their own businesses, startup types, you name it. You can find the man’s blog here and pre-order his book, due out at month’s end, here. The title Great at Work: How Top Performers Do Less, Work Better, and Achieve More.

Have a few minutes extra this morning? Go read this week’s Lunch with the FT featuring Bridgewater boss Ray Dalio. The hedge fund giant talks rising income inequality and “why politics trumps economics in 2018.” Then skip over to the New York Times and learn why you’re wrong if you think Canadian whiskey is as insipid as that Crown Royal stuff with which you’ve been plied in the past.

What We’re Tracking This Week

Our friends at EFG Hermes hosts their annual Egypt Day on Monday at the Four Seasons Nile Plaza. This year’s event will begin with the firm’s annual CEO dinner, the first major event on the 2018 investor calendar for Egypt.

Enterprise+: Last Night’s Talk Shows

Between the anticipated cabinet shuffle, a slew of presidential nominees emerging over the weekend, and the Ethiopian prime minister’s arrival in Cairo later today, the airwaves were chock full of political discussion last night.

Reports suggest that 4-5 ministers — including those of tourism, local development, and culture — will be exiting stage right, Hona Al Assema’s Lamees Al Hadidi said. Lamees’ sources tell her that Tourism Minister Yehia Rashed will be succeeded by former CBE sub-governor and current IMF advisor Rania Al Mashat (bio | profile). The same sources told Lamees that Prime Minister Sherif Ismail will remain in office (watch, runtime: 5:56).

Al Hayah Al Youm’s Tamer Amin, meanwhile, said his sources claim that Ismail has submitted his resignation to President Abdel Fattah El Sisi and that 5-6 ministers will be replaced (watch, runtime: 2:47). Amin says the PM has asked for leave to resign for health reasons.

Deputy House Speaker Soliman Wahdan phoned in to tell Amin that changing the prime minister would entail changing the entire government and having the new cabinet present a fresh program to parliament. Considering that a new government will be formed following the presidential elections, Wahdan said it is most probable that Ismail will not be replaced in today’s shuffle (watch, runtime: 6:02).

Back on Hona Al Assema, Lamees led the discussion on the presidential elections. Former MP Mohamed Anwar Al Sadat confirmed that he is still mulling a run and will announce his final decision tomorrow after gauging public support. Al Sadat also said he had sent a request to parliament to meet with MPs who have not already signed forms backing President El Sisi, but found no takers (watch, runtime: 3:04).

Khaled Ali’s presidential campaign has already submitted a complaint to the National Elections Commission over allegations that some real estate registration offices are hindering citizens’ ability to sign forms endorsing Ali’s nomination, campaign spokesperson Amr Abdelrahman told Lamees (watch, runtime: 6:49).

House spokesperson Salah Hasaballah also spoke to Lamees about Ethiopian Prime Minister Hailemariam Desalegn’s visit, of which he says parliament has yet to be officially notified. However, Hasaballah says that Desalegn will deliver a speech at the House and that MPs are only agreeing to hear him out in order to resolve the stalemate over the Nile (watch, runtime: 5:16).

Kol Youm’s Amr Adib and Yahduth fi Masr’s Sherif Amer were off last night.

Speed Round

Speed Round is presented in association with

The Planning Ministry has revised Egypt’s economic growth figure for FY2017-18 to 5.3-5.5% from a previous 5-5.25%, Minister Hala El Said announced on Saturday, according to Reuters. GDP growth “was expected to have grown 5.2-5.3% in the second quarter that ended in December,” according to El Said, who also said that the government is aiming for average GDP growth levels of 6% in FY2018-19. Egypt is also “targeting a 20% rise in total investment for FY2018-19, up from EGP 646 bn (USD 36.58 bn) targeted for FY2017-18,” the minister added.

Misplaced optimism when it comes to inflation figures? The revised forecasts followed the announcement of a sharp drop in monthly inflation levels in December, which fell to -0.2% — the lowest rate in two years — largely driven by a decrease in prices of staples including red meat, poultry, vegetables, and lentils. Some economists tell Reuters that “the inflation drop is the result of a strong base effect, and not necessarily a meaningful economic recovery.” Beltone Financial’s Alia Mahmoud says the decrease could just be a sign of weak demand for certain products, meaning that purchasing power has not yet recovered fully. “Segments of society have shifted from meat to cheese as a source of protein,” CI Capital Asset Management’s Noaman Khalid explains, stressing that “a complete economic cycle that includes business recovery and increased wages is necessary before purchasing power returns to pre-float levels.”

Remittances from Egyptians living abroad rose 5.8% y-o-y in November 2017 to USD 2.2 bn from USD 2.1 bn in November 2016, the central bank announced on Thursday. Remittances have been climbing steadily since the EGP float in November 2016, Reuters notes, jumping nearly 40% y-o-y in 1Q2017-18 to USD 6.0 bn.

This comes as we hear that tourism revenues reportedly jumped 123.5% y-o-y to USD 7.6 bn in 2017. The number of tourists that visited the country during the year grew 54% y-o-y to 8.3 mn, an unidentified government official tells Reuters. “The number is still well below the 14.7 mn who visited Egypt in 2010 before the uprising,” the newswire notes.

IPO WATCH- Healthy pipeline of IPOs for 2018, Farid says. Eight companies have reportedly begun procedures to list on the EGX, said bourse boss Mohamed Farid. Among them are companies in the real estate and tourism sector, he added without naming names. Up to six companies, primarily in petrochemicals and finance, have begun talks and inquiries into listing, said Farid, according to AMAY.

Separately, the EGX is planning an investor roadshow to Asia in 1Q2018 targeting markets including Hong Kong, Malaysia and Singapore, said Farid.

M&A WATCH- Pharos Holding expects to complete advisory on four or five M&A transactions and capital increases in 2018, head of investment banking at the firm Sherif Abdel Aal tells AMAY. The firm also expects to lead a number of IPOs this year, Abdel Aal pointing to potential offerings in the food, healthcare and education sectors. The firm will also be gunning for some of the listings of state-owned companies this year, he added. All in, Pharos is currently managing 15 transactions worth up to EGP 10 bn. Abdel Aal had previously said Pharos would be quarterbacking two IPOs in 1Q2018 worth EGP 1 bn a piece.

M&A WATCH- An unnamed UK-based fund has made overtures to acquire Egyptian pharma company Amoun from its embattled Canadian parent company Valeant, sources tell Al Borsa. The fund has reportedly made a USD 600 mn offer to acquire 100% of Amoun, and the newspaper is reporting that an unnamed Kuwaiti outfit will soon present a rival offer. The Canadian company, which bought Amoun back in 2015, is expected to divest Amoun within a matter of months. The sale comes as part of Valeant’s plan to reduce its USD 31 bn debt load.

M&A WATCH- EFG Hermes is reportedly looking to acquire a controlling stake in Bio Pharma Egypt by buying BPE Partners’ Midcap fund’s shares, sources told Al Mal. The transaction would be part of EFG Hermes’ merchant banking operations, the source says, suggesting the transaction would be warehoused for EFG’s Rx Healthcare Fund.

INVESTMENT WATCH- Private transport company Mowasalat Misr has plans to invest EGP 3 bn in Egypt by 2021, CEO Hisham Taha said on Thursday, Al Mal reports. Mowasalat successfully completed a capital increase to EGP 150 mn this month and intends to increase that to EGP 250 mn before the end of 2018, he added, pointing out that Mowasalat majority shareholder Emirates National Group is determined to move forward with plans to expand its Egypt operations which could potentially involve a 2020 IPO. Taha’s statements came during the launch ceremony for the first phase of the smart buses project in Cairo, which saw Mowasalat introduce 56 new WiFi and A/C-equipped buses to Cairo’s streets following an earlier trial run. Mowasalat had also said last July that it was planning to bring 500 buses into its fleet over the next two years to cover the Greater Cairo area and was in talks with Egyptian and European backers for financing. The company had said in November that it was investing EGP 1 bn in 2018 and was tapping Emirates NBD and ADIB for loans totaling EGP 500 mn.

INVESTMENT WATCH- Retail chain HyperOne is planning to open a EGP 500 mn branch in Solaimaneyah City this year, founder and Chairman Mohamed El Hawary tells Al Masry Al Youm. The inauguration, which was originally slated for last year, was delayed due to “procedural issues” with the government, according to El Hawary. The company will press ahead with its previously announced plans to build new branches in Badr, Assiut, and Al Shorouk at a total cost of EGP 2 bn, despite not having resolved those issues, he says. Separately, El Hawary confirmed that HyperOne had received two separate bids to acquire stakes in the company, but said they were rejected. He had previously denied reports of investors bidding for a “major stake” in the company.

CSCEC invests USD 3 bn in development of business district in new capital: We finally appear to have a price tag for China State Construction Engineering Company’s (CSCEC) work in the new capital, as the company is putting in USD 3 bn in developing the business district. The construction giant’s area of development will also include the development of a 345-m tower (the tallest in Africa), said Housing Minister Moustafa Madbouly, according to Al Borsa. CSCEC had signed the contracts last October during the inauguration of the first phase development of the new capital after a troubled and prolonged negotiation period.

We still don’t have news about China Fortune Land Development Company’s expected USD 4 bn contract to develop an industrial zone of the new capital over the next five years. Reports had emerged that the company would sign for the projects last month.

MOVES- Centamin Executive Chairman Josef El-Raghy is retiring “effective following the completion of a succession process and orderly handover throughout 2018,” according to a company statement. Expect a successor to be announced by the end of June, the company said. The company also announced a number of appointments to the board of directors and senior management.

LEGISLATION WATCH- The Trade and Industry Ministry has finished drafting the new SME law and sent it to the Ismail Cabinet for review, Minister Tarek Kabil said on Friday, Al Shorouk reports. The law is expected to introduce a number of tax and non-tax incentives meant to encourage SMEs to join the formal economy, such as facilitated funding and zero-interest on loans extended to registered SMEs. Kabil said the new act — which replaces legislation from 2004 — will allow the SMEs Development Authority to extend technical support services, as well as direct and indirect funding to registered companies. The authority recently signed off on a new national development strategy for SMEs, Kabil also said.

In other legislative news, the committee mandated with drafting the executive regulations of a potential Customs Act held its first meeting yesterday, Al Masry Al Youm reports. The Finance Ministry had said last month that it would complete drafting the legislation, which has been in the works for around eight years, in three months’ time. The bill is expected to impose “strict punishments” on customs evaders while reducing clearance times and fees for importers.

Jockeying for position ahead of this spring’s presidential poll is in full-swing: The presidential elections are beginning to take shape, with a number of hopefuls announcing their intention over the past few days. These include:

Former Egyptian Armed Forces Chief of Staff Sami Anan is vying for the top job, after being nominated by the Arabism Egypt Party, which he leads, Reuters reports. The party will hold a press conference within days to formally announce Anan’s run, according to part member and MP Ragab Helal. “‘The bet is on the people who are suffering, and securing their votes,” Helal told the Associated Press.

Human rights lawyer and activist Khaled Ali officially announced his bid at a statement to the press on Thursday. He pointed to rising prices and human rights conditions as being the main impetus behind his candidacy. Ali also referenced his conviction of a “lewd hand gesture in public” as part of a smear campaign mounted against him. He may be declared ineligible to run if his appeal is not accepted at a hearing scheduled for March. Al Dostour Party has announced it will throw its weight behind Ali’s bid, Al Shorouk reports.

And the circus is finally complete: Mortada “The Mortadel” Mansour has apparently decided that the elections lacked some zest after former Civil Aviation Minister Ahmed Shafik withdrew his candidacy, announcing he will be running for the top job, Al Masry Al Youm reports. Mansour is apparently relying on MPs from Islamist party Al Nour to scrape up the 20 signatures needed to file his nomination papers. We would like to remind our readers at this point that Mansour has already run for presidency twice, giving rise to one of the greatest parody campaign videos of all time. We hope his next “vision” to bow out of the race comes quick as even his equally bombastic son said he would not vote for him.

Expect an announcement from President El Sisi soon: Ittihadiya is holding a “state of the union” conference this week to highlight President Abdel Fattah El Sisi’s accomplishments in office, unidentified sources say, according to Ahram Gate. El Sisi had previously said that the public’s reaction to the address would determine whether or not he will announce his candidacy. El Sisi will also take the time during the conference to address questions citizens have submitted through the “Ask Your President” initiative, which he launched again last week. The exact date of the conference remains unclear; sources tell Al Masry Al Youm that it will be held sometime between 17 and 19 January, while Al Shorouk cites television reports as saying it will take place on Wednesday 17 January. More than 500 members of parliament have signed “recommendations” for El Sisi to run for a second term, the Associated Press reports. The Wafd Party officially announced yesterday its endorsement of El Sisi, Al Shorouk reports.

You can also tap here for a brief rundown of the nominees, courtesy of Al Masry Al Youm.

Egypt in the News

On a quiet morning in the international press, tensions between Egypt and Turkey dominate. First off, an unnamed diplomat tells Breitbart that “Egyptian authorities are concerned that Turkey will try to sabotage the presidential elections” to take a stab at President Abdel Fattah El Sisi. News outlets including Xinhua are also noting concerns raised by the Foreign Ministry of Turkey’s alleged involvement in a shipment of explosives to Libya. The cargo was interdicted by Greek authorities.

The New York Times says it is standing by the story it reported last week that “described a covert effort by Egyptian intelligence to sway public opinion in favor of accepting President Trump’s decision recognizing Jerusalem as Israel’s capital.” This follows Prosecutor General Nabil Sadek ordering a formal investigation into the story. The Associated Press and The Hill also covered the news, with the latter emphasizing that MP Mostafa El Gendy accused the paper of being “at war” with Egypt.

Meet the “honorable citizen” trying to kill Egypt’s sense of humor:The New York Times’ Declan Walsh has put a face to the name behind litigation that aims to censor and punish just about anyone in the public domain. The ironically named Samir Sabry can boast being behind frivolous litigation ranging from the silencing of Abla Fahita and Sherine to more politically sensitive cases including the obscene gesture case that could end human rights lawyer Khaled Ali’s presidential bid. The piece even hints that the man, who has also gone after the Guardian, may have lied about his PhD credentials. All in all, a real class act. Hats off to Mr. Walsh for this piece — it’s an act of public service to Egypt

Also worth noting in brief today:

Worth Reading

Is the English language taking over the world? Private English-language school students in Egypt that “now struggle to speak Arabic” are part of a “global generation in which tens of mns of people from outside the English-speaking world speak perfect English,” the Financial Times’ Simon Kuper says. The number of English language students around the world is c. 10x higher than the collective number of people learning other languages, German linguist Ulrich Ammon estimates. “And the more people who speak English, the more useful English becomes.” That not only means that the US and UK will eventually “lose their dominance of media” — it’s bad news for non-English languages and literatures,” Kuper argues. “The next global ruling class will perceive the world chiefly in English. That will be a loss…[as] you can only see what your language allows you to express.”

Diplomacy + Foreign Trade

Israeli Prime Minister Benjamin Netanyahu’s office denied reports that he had asked the Obama administration to consider a plan in which Israel would annex parts of the West Bank, and the Palestinians would in return receive land from Egypt in the northern part of Sinai, Haaretz reports. The plan, uncovered by former US officials, was reportedly proposed in 2014. “The Obama administration heard directly from Egypt, however, that it wouldn’t accept such an idea, and came to a conclusion that neither would the Palestinians.”

Meanwhile, Israeli pundits are suggesting looking to Egypt when it comes to policies in Gaza.Israel must find ways to reduce the humanitarian and economic pressures on the Gaza Strip in order to avoid escalation, Udi Dekel suggests in The JPost. The piece also recommended that Israel enlist Egypt and give it a toolbox that includes significant infrastructure-related and economic rewards, designed to tempt Hamas to make a genuine effort to keep the area calm.” He also presents four potential courses of action, including enlisting Egypt to mediate with Hamas.

Egypt will be running a candidate for the Secretary General post of the Common Market for Eastern and Southern Africa (COMESA), Trade and Industry Minister Tarek Kabil said, according to Al Masry Al Youm.” Each country aiming to run for the seat is required to field five candidates by 6 February, according to COMESA’s regulations,” Ahram Online notes. The winning candidate will replace Zimbabwe’s Sindiso Ndema Ngwenya.

Egypt’s Ambassador to Saudi Arabia Nasser Zaghloul has been appointed as non-resident ambassador to Yemen. Zaghloul has served as Egypt’s envoy to Saudi Arabia since 2015, Ahram Online notes.

Energy

ADES extends three major rig contracts in the Gulf of Suez

LSE-listed ADES International Holding announced successfully extending rig contracts in the Gulf of Suez area. ADES extended two existing contracts for Admarine II, Admarine IV and renewed its lease for Admarine VI. BP’s joint venture GUPCO extended its existing contract for ADES’ Admarine II jack-up barge and jack-up rig Admarine IV. ADES also renewed its existing contract for its Admarine VI jack-up rig with the General Petroleum Company.

Shell struggling to find a buyer for Gaza Marine

Shell is struggling to find a buyer for its gas field off the Gaza Strip, “even among energy companies long used to dealing with projects fraught with political and security risks,” Reuters reports. “Until the political situation is resolved I really can’t see anything happening here,” a source says. “According to two industry sources, Shell is currently in talks with the Palestinian Investment Fund (PIF) to find a buyer for the energy giant’s 55 percent stake in Gaza Marine.” The field is estimated to hold 1 tcf of natural gas. Shell is unlikely to go ahead with the development of the field in the foreseeable future, according to several sources.

Basic Materials + Commodities

Agricultural exports up in 2017 despite bans on various crops

Egypt exported 4.813 mn tonnes of crops in 2017, up from 4.343 mn tonnes in 2016, according to an Agriculture Ministry report picked up by Al Shorouk. Citrus exports were in the lead with 1.4 mn tonnes, while potatoes came in second with 800k tonnes, followed by onions with 500k tonnes. Egypt also saw exports of peppers, strawberries, grapes, mango, and pomegranates increase during 2017. The increase in exports comes despite the blanket bans issued by a number of Arab countries on imports of various Egyptian crops, including strawberries, guavas, and peppers due to concerns about high levels of residual pesticides.

Manufacturing

Kabil breaks ground on Polaris SME industrial complex

Trade and Industry Minister Tarek Kabil broke ground yesterday on Polaris Parks’ EGP 250 mn Bosla SMEs industrial complex in 6 October City, according to an emailed statement (pdf). Polaris Parks also signed yesterday a cooperation protocol with the National Bank of Egypt (NBE) to offer subsidized loans to investors in the new complex, Al Borsa reports. Kabil also announced at the inauguration that the Trade and Industry Ministry is planning to tender 5 mn sqm to industrial developers throughout the year, according to Al Borsa. Kabil also inaugurated yesterday three projects in 6 October with a combined investment value of EGP 650 mn, Al Borsa reports. The projects include Al Gioshy Steel’s EGP 500 mn steel factory, a EGP 50 mn smart meters production factory, and a new EGP 100 mn production line for packaging materials at General Print’s factory.

Dice looking for leasing contract, says it’s not part of Minya textile city project

Dice Sport and Casual Wear is looking to sign a USD 2.5 mn financial leasing agreement to help pay its short-term debts, the company announced on Thursday (pdf), after receiving the board of directors’ approval. Dice also denied reports that it is part of the consortium bidding to construct the Minya textile city project for an estimated investment cost of USD 324 mn, according to a bourse statement (pdf). A source had said that a consortium was looking to establish the project on a 306-feddan land plot.

Military Production Ministry signs MoU with Chinese steel pipe company

The Military Production Ministry signed an MoU with China’s Heiching Bay Steel Group of Chinese Steel Pipes and Egypt AAA to cooperate in the manufacture of steel pipes, Military Production Minister Mohamed El Assar said in statements picked up by AMAY. The MoU stipulates that a 550k sqm factory will be built in Egypt to produce 6-50 meters pipes for the local and export.

South Korean Investors in talks with IDA for Matruh industrial area

South Korean investors are in talks with the Industrial Development Authority (IDA) to establish a 2 mn sqm private-sector industrial zone in Marsa Matrouh, government sources told Youm7.

Real Estate + Housing

First Group launching projects worth EGP 1.3 bn this year

Real estate developer First Group is launching two new projects this year with investments valued at EGP 1.3 bn, Chairman of the Board of Directors Bashir Mostafa said in statements picked up by AMAY.

Samcrete investing EGP 300 mn in Pyramids Heights project this year

Real estate developer Samcrete is investing EGP 300 mn into its Pyramids Heights project this year, Managing Director Hisham Al Khashin said, according to AMAY. The EGP 1.2 bn project is set to be completed by 2020 and has already achieved sales of EGP 550 mn.

Tourism

Air Arabia to start flights to Milan in May

Air Arabia Egypt is launching a new biweekly route between Alexandria’s Borg El Arab Airport and Milan starting 4 May, according to a company statement carried by Al Borsa. The flights will be Sundays and Fridays. Sharjah-based Air Arabia uses Borg el Arab as its operational hub in Egypt.

Telecoms + ICT

NTRA imposes EGP 25,000 fines for wrong KYC data

The National Regulatory Telecommunications Authority (NTRA) has imposed fines of up to EGP 25,000 on mobile network operators for every customer whose data has not been logged correctly by the company, government sources tell Al Borsa. The move is the latest in a series of decisions by the NTRA to ensure KYC data is collected, including ending the sale of new phone lines by distributors in March and limiting them to official branches of MNOs.

Raya Contact Center looking to expand to Saudi Arabia in 1Q2018

Raya Contact Center is looking into opening up shop in Saudi Arabia in 1Q2018, Chairman Reem Saad said, Al Masry Al Youm reports. The company is currently in talks with officials from the Saudi Arabian Commerce and Investment Ministry over the legal details of the expansion.

Automotive + Transportation

Transport Ministry studying offers from global firms for maintenance of 100 locomotives

The Transport Ministry is reportedly studying offers from global firms, including Canada’s Bombardier and the US’ EMD, on a maintenance contract for 100 locomotives, according to unnamed ministry officials. Feasibility studies set the project’s estimated value at USD 125 mn and the offers include financing options in the form of facilitated loan agreements, the sources tell Al Mal, explaining that the ministry might delay its response for about three months in order to draft a repayment plan. The Transport Ministry has inked a USD 575 mn supply and maintenance agreement with General Electric and a EUR 290 mn agreement with the European Bank for Reconstruction and Development to purchase new locomotives needed for planned railway upgrades.

Banking + Finance

Golden Pyramids Plaza seeks shareholders’ approval to issue USD 200 mn in bonds

Golden Pyramids Plaza is looking to issue USD 200 mn in USD-denominated bonds to pay for a previous issuance, according to a bourse statement. The company is seeking its shareholders’ approval for the issue in an EGM.

Other Business News of Note

European commission to finish Egypt-Chad road study in March

The European Commission is preparing a feasibility study for an overland route connecting Egypt to Chad and six other central African countries that will be ready in March, secretary general of the Federation of Egyptian Chambers of Commerce Alaa Ezz said in statements picked up by Al Borsa. The government agreed in principle for the establishment of the route last month and a global tender was issued for the feasibility study.

Egypt Politics + Economics

Court clears El Adly’s convictions, orders retrial

The Court of Cassation has quashed former Interior Minister Habib El Adly’s conviction and prison sentence and ordered a retrial, Reuters reported. El Adly was released from Tora Prison yesterday, security sources said, according to Al Masry Al Youm. El Adly’s lawyer had told Reuters that the court’s decision would allow for the former minister, who did not attend the hearing, to be released without further legal procedures.

Supreme Constitutional Court postpones final ruling on Tiran and Sanafir case

The Supreme Constitutional Court has postponed its ruling on the government’s appeal against the annulment of the Tiran and Sanafir island handover agreement with Saudi Arabia to 3 March, Al Masry Al Youm reports.

Government targeting Suez Canal revenues of USD 5.7 bn for fiscal year 2018

The government is targeting Suez Canal revenues of USD 5.7 bn by the end of the fiscal year ending in June 2018, according to Youm7. The revenues would mark a slight increase over last year’s USD 5.6 bn.

National Security

Egypt imposes curfew on parts of North Sinai

Egypt imposed a curfew on certain areas of North Sinai as of Saturday, after House Representatives signed off on a decision extending the state of emergency for another three months last week. The decision was published in the Official Gazette and “includes areas at the border town of Rafah near Gaza from 7pm. to 6am, and around the town of El-Arish from 1am to 5am,” Reuters says. “The curfew will continue as long as the state of emergency is still in place.”

On Your Way Out

The Cotton Egypt Association has unveiled a new brand identity and digital platform to re-enforce Egyptian Cotton as the finest cotton in the world, according to Fibre2Fashion. The campaign runs with the tagline “Be Human” and is “designed to increase consumer demand and retailer confidence and will support the Cotton Egypt Association’s drive to rid the supply chain of falsely labeled Egyptian Cotton goods.”

Egyptian actor Ahmed Al Sakka is play President Abdel Fattah El Sisi in his upcoming film Serri Lel Ghaya (Highly Confidential), which traces the events of the January 2011 uprising all the way through to June 2013. The film is due for a May release, according to Al Masry Al Youm, and has an all-star cast of more than 200 Egyptian actors, cast member Abdel Aziz Makhyoun tells the newspaper. Among those starring: Adel Imam, Karim Abdel Aziz, and Ahmed Rizk, who will be playing the role of ousted Ikhwani president Mohammed Morsi.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.6557 | Sell 17.7557
EGP / USD at CIB: Buy 17.65 | Sell 17.75
EGP / USD at NBE: Buy 17.65 | Sell 17.75

EGX30 (Thursday): 15,242 (+0.3%)
Turnover: EGP 1.2 bn (9% above the 90-day average)
EGX 30 year-to-date: +1.5%

THE MARKET ON THURSDAY: The EGX30 ended Thursday’s session up 0.3%. CIB, the index heaviest constituent closed down 0.2%. EGX30’s top performing constituents were Ezz Steel up 5.5%; AMOC up 3.4%; and Egyptian Iron & Steel up 3.1%. Yesterday’s worst performing stocks were Orascom Telecom Media & Technology down 1.4%; Egyptian Resorts down 0.6%; and Elsewedy Electric down 0.5%. The market turnover was EGP 1.2 bn, and foreign investors were the sole net buyers.

Foreigners: Net Long | EGP +76.7 mn
Regional: Net Short | EGP -5.4 mn
Domestic: Net Short | EGP -71.3 mn

Retail: 60.5% of total trades | 54.3% of buyers | 66.8% of sellers
Institutions: 39.5% of total trades | 45.7% of buyers | 33.2% of sellers

Foreign: 21.2% of total | 24.5% of buyers | 18.0% of sellers
Regional: 14.2% of total | 13.9% of buyers | 14.4% of sellers
Domestic: 64.6% of total | 61.6% of buyers | 67.6% of sellers

WTI: USD 64.3 (+0.78%)
Brent: USD 69.87 (+0.88%)
Natural Gas (Nymex, futures prices) USD 3.2 MMBtu, (+3.76%, February 2018 contract)
Gold: USD 1,334.9 / troy ounce (+0.94%)

TASI: 7,338.04 (+0.52%) (YTD: +1.55%)
ADX: 4,591.11 (+0.25%) (YTD: +4.38%)
DFM: 3,494.63 (-0.14%) (YTD: +3.7%)
KSE Weighted Index: 415.8 (+0.4%) (YTD: +3.58%)
QE: 9,135.86 (+0.97%) (YTD: +7.19%)
MSM: 5,087.47 (-0.24%) (YTD: -0.23%)
BB: 1,316.88 (-0.07%) (YTD: -1.11%)

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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)

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.

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