Sunday, 4 February 2018

We’re getting a USD 3.3 bn theme park in “largest FDI since Investment Act”

TL;DR

What We’re Tracking Today

It’s shaping up to be a busy week in Egypt that will see a lot of noise in the macro backdrop. For starters:

MENA-based investors are the canaries in the coal mine this morning as traders watch for signs that a global market correction has arrived. With the S&P 500 down nearly 4% last week, Reuters noted overnight that “a long-awaited correction may have arrived on Wall Street [and] will keep investors on edge on Monday after the S&P 500 closed off the week with its biggest percentage drop in two years.” (See coverage here and here). Bloomberg, meanwhile, notes that “traders are asking if the bond and stock selloff is the start of something big” and guides readers to the idea that while volatility may be the order of the day in 2018, “it’s definitely not the end of the bull market … to see the end of the bull market, you need to see the U.S. go into a recession.”

And while we’re talking global macro, look for oil at USD 82.50 per barrel within six months, Goldman Sachs says, hiking its short-term crude oil price forecasts by as much as 33%. Analysts there see Brent at USD 75 within three months before climbing north of USD 80 six months out. They had previously forecast USD 62 a barrel for both time periods. Oil hasn’t broken the USD 8- barrier since 2014 as it fell from north of USD 100. Bloomberg has the story.

LPs in an Abraaj healthcare fund have hired an auditor to trace their money, the Wall Street Journal reports, and the Dubai-based firm has tapped KPMG to conduct its own audit. Investors asking for the investigation include the Bill & Melinda Gates Foundation, the IFC as well as development finance institutions CDC and Proparco. Philips, the Dutch healthcare company, has not signed onto the investigation, the Journal quotes a spokesman as saying. The story is absolutely worth a read, but more as a cautionary tale about (a) the challenges of deploying capital in emerging markets and (b) the need to communicate regularly with your investors: A close read suggests the funds for which LPs are demanding an accounting were drawn down for investment in EM opportunities that subsequently hit roadblocks.

Transactions on the EGX doubled in 2017, with foreign investment rising 64% y-o-y for the year, said EGX boss Mohamed Farid on Thursday, Al Borsa reports.

This comes as foreign investment in Egyptian debt reached USD 19.8 bn at the end of last week, Vice Minister of Finance Minister Ahmed Kouchouk said on Wednesday, according to Reuters. Egypt will go to the international bond market with a USD 4 bn eurobond issuance in the second week of February, according to Finance Minister Amr El Garhy. The bonds will be issued on the London and Luxembourg stock exchanges, he says. HSBC, Citigroup, JPMorgan Chase & Co, Morgan Stanley, and National Bank of Abu Dhabi will be managing the issuance. Al Tamimi & Co. and Dechert LLP were chosen as legal advisors to the government and Linklater LLP and Zaki Hashem & Partners are advising the banking consortium.

President Abdel Fattah El Sisi is heading to Oman today in his first official visit to the Sultanate, according to an Ittihadiya statement. El Sisi is set to meet with Sultan Qaboos bin Said and a number of top Omani officials to discuss bilateral relations and regional issues.

The president will head to the UAE after his stop in Muscat to meet with Abu Dhabi Crown Prince Mohammed bin Zayed Al Nahyan.

Egypt is hosting the fintech and digital economy conference “Seamless North Africa” on Tuesday, the Central Bank of Egypt announced in a statement (pdf). The two-day conference, which the CBE is hosting, will allow local and global fintech companies to showcase their offerings in the region’s largest potential market

The House of Representatives will discuss the Consumer Protection Act in a plenary session “soon,” House Economics Committee chair Amr Ghallab said yesterday, Al Mal reports. The committee signed off on the bill last week; among other things, it will force retailers to print prices on their products and impose harsher fines and penalties on violations of good consumer practices.

The Federation of Egyptian Chambers of Commerce is planning to launch an industrial map for the Suez Canal Economic Zones and other national projects at the Egypt Investment Forum, which wraps up this evening, federation head Ahmed El Wakeel tells Youm7. The federation’s map is the latest document to be released independently since the delayed reveal of the Investment Ministry’s master investment map for the country. The Trade and Industry, Agriculture, and Higher Education ministries have each released their own maps over the past several months.

Cast aside the interwebs for pen and paper: Digital geeks that we are, at least three of us are nevertheless die-hard notebook fans, at least when it comes to managing our day-to-day task lists. Seems we’re not alone, if the Financial Times is anything to go by. Does this sound like you? “In the dark days leading up to the new year, I had been drifting around the internet in search of a task manager that would focus my mind. I tried all sorts of apps in 2017: Asana, Todoist, Trello. I had five coffee-stained notebooks full of contextless scrawls. I had saved restaurants I had forgotten I wanted to visit in Foursquare; books I had forgotten I wanted to read in Goodreads; and thoughts I had forgotten I had recorded in my Notes app. There was something sad about revisiting these abandoned lists.” If so, read Why I started a bullet journal — and so should you.

Expect bleary-eyed officemates tomorrow: It’s Super Bowl Sunday in Amreeka tonight. Fans of American football will gather around the tube to scream obscenities and scarf down wings and other comestibles as the New England Patriots square off against the Philadelphia Eagles.

PSA: the Alexandria Water Company has announced water cuts in areas of the governorate to take place for eight hours starting 9:00pm Sunday night, Al Masry Al Youm reports.

Expect the coming seven days to be unseasonably warm: The mercury is due to hit 28°C today before jumping north of 30°C starting Wednesday. A week of warm toes ahead—as much as we love ‘winter’ in Cairo, we couldn’t be happier.

What We’re Tracking This Week

It’s PMI day tomorrow: Egypt’s Emirates NBD purchasing managers’ index reading for January will be announced on Monday, 5 February.

When, exactly, are railway ticket prices going to rise? There appears to be some confusion as to when Transport Minister Hisham Arafat intends to announce new railway ticket prices. News reports quote Arafat and other Egyptian National Railway (ENR) officials saying that the hike could happen any time between the next few days and the end of June this year as the exact date has not been set. What we do know is that prices are expected to rise between 25-30% depending on the type of train and class. Remaining steps include updating prices on the online booking system and announcing the new prices in all stations nationwide.

On The Horizon

The central bank’s Monetary Policy Committee will meet on 15 February to decide on interest rates.

A delegation of 22 British companies led by UK trade envoy Jeffrey Donaldson is visiting Egypt on 10 February to discuss a tripartite trade agreement between the UK, Egypt, and China centered on exports to African markets.

Enterprise+: Last Night’s Talk Shows

It was a two-pronged evening on the airwaves last night, with the debate being largely dominated by the sharp drop in poultry prices at government outlets and (naturally enough) continued discussion of the presidential election campaign.

Masaa DMC’s Eman El Hosary sat down with presidential candidate Moussa Mostafa Moussa, who said Al Ghad Party — which he heads — saw a “major opportunity” to win the elections after candidates dropped out of the race (watch, runtime 4:25). He also told El Hossary that his goal is to win (watch, runtime 4:24).

Over on Al Hayah Al Youm, Al Tagamoa and Al Wafd party representatives each threw their weight behind President Abdel Fattah El Sisi, slamming opposition calls for a boycott of the presidential poll. They told host Tamer Amin that El Sisi’s re-election is a necessity to keep the Ikhwan at bay (watch, runtime 4:05).

Al Wafd Party’s deputy head Hossam El Kholy said that he hoped to see more competition in the elections, but urged citizens to head to the polls regardless of their choice (watch, runtime 4:33).

Over on Hona Al Asema, Lamees Al Hadidi discussed the election in her 4+1 segment (watch, runtime 2:40) and talked about President Abdel Fattah El Sisi’s visit to Oman with Ittihadiya spokesman Bassam Rady, who said the president’s itinerary centers around economic relations and regional issues, including Syria and Yemen (watch, runtime 3:27).

Lamees also spoke to Supply Ministry spokesman Mamdouh Ramadan about the sudden drop in poultry prices. He said the government moved to plug the gap in the poultry market through new imports, preferring that to being “at the mercy” of certain local producers that failed to meet the country’s production needs (watch, runtime 1:55). Ramadan also reassured citizens that the poultry is safe for consumption, (watch, runtime 3:35) in answer to claims suggesting that the low price tag is the result of a close expiry date.

Lamees also spoke to the head of the Cairo Chamber of Commerce’s poultry division, Abdel Aziz El Sayed, who pointed out that the low poultry prices at government outlets will harm private-sector suppliers and retailers, who will not be able to compete (watch, runtime 4:11). El Sayed also said that he sees prices rebounding to a normal range of EGP 26-27, claiming the state is pushing a subsidy of EGP 9 per kg of chicken, which has warped the prices. (watch, runtime 16:43).

With the notion of supply and demand seemingly lost on him (and the notion of asking his wife anathema), Kol Youm’s Amr Adib clucked around like a headless chicken looking for answers to why and how poultry prices dropped to lows of EGP 15 per kg from a previous EGP 29. He spoke to Consumer Protection Agency head Atef Yacoub (watch, runtime 5:57) and Food Industries Holding Company Chairman Alaa El Din Fahmy (watch, runtime 4:22).

Speed Round

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INVESTMENT WATCH- US-Saudi group to invest USD 3.3 bn in Egypt theme park — largest FDI since Investment Act: Entertainment World Company signed a contract to develop a USD 3.3 bn “Disneyland-style” theme park on a 5,000-acre plot of land in Al Alamein, the Investment Ministry said in a statement on Thursday. The project, which will be funded with investments from the US and Saudi Arabia, includes the establishment of an open zoo, an aqua park, medical and sports cities, and hotels, said Matrouh Governor Alaa Abu Zeid. Investment Minister Sahar Nasr hailed the project as the largest foreign direct investment in Egypt since the issuance of the Investment Act. Managing director of Entertainment World MEA Lisa Marie Stephen said the theme park, one of Entertainment World Company’s largest investments globally, will be implemented over the course of nine to 10 years, over several stages, with the first stage completed over two years.

That’s just one of several big announcements on Saudi investment to come out of the Thursday meeting of the Egyptian-Saudi Business Council.

Also Thursday: Saudi Arabia’s Al Tayyar Travel Group said it plans to invest “EGP bns” in Egypt’s real estate and tourism sectors over the coming period, said Ahraf Sheeha, head of Al Tayyar Egypt, according to Al Mal. The statements follow a meeting with Housing Minister Moustafa Madbouly, who reportedly promised to clear obstacles facing real estate investors as a condition of the company bidding for an investment in New Alamein, Al Masry Al Youm reports. The Group’s CEO, Abdullah Aldawood, had told Reuters last December that the company would commit fresh capital to Egypt in early 2018.

QIZ agreement with Saudi? At the meetings, a number of investors called on Trade and Industry Minister Tarek Kabil to establish an investment and manufacturing framework between both countries along the lines of the the Qualified Industrial Zones (QIZ) between Egypt, the US, and Israel. This would help spur Saudi investment in Egypt, which according to Kabil topped USD 6.1 bn in 2017.

Thursday also saw the signing of a EGP 1.2 bn agreement with the UAE’s El Orouba for Real Estate, which would see it develop a resort in Matrouh over a 172-feddan area. El Orouba will also invest EGP 3.2 mn a year on a date production facility in Siwa, the statement notes.

INVESTMENT WATCH- Elsewedy Electric announced that (pdf) says it still hasn’t gotten the official green light for its plans to build a 500 MW wind farm project in the Gulf of Suez and a 200 MW facility in Ras Ghareb. The project, in which Elsewedy is partnering with Masdar and Marubeni in, is estimated to carry an investment cost of USD 900 mn and was announced in January. Elsewedy says the project is still in the negotiations phase with the New and Renewable Energy Authority (NREA) and that the final price tag on it has not been set yet.

2018 is “Egypt’s year,” according to BMI Research Africa Monitor report for February. “While the region as a whole is set to see growth accelerate, Egypt stands out as the economic outperformer in 2018, as structural reforms implemented as part of the 2016 IMF [agreement] begin to spur more significant investment, while headwinds to household consumption cool.” The report tempers expectation by saying “the outlook is not uniformly bright, with elevated political instability likely to persist. However, these challenges, while offering some economic headwinds, will not be sufficient to derail the bright growth story in 2018.” BMI’s report also gives a nod to the new investment act, which it expects will “further boost investor confidence, and drive fixed capital formation in the country. An uptick in investment will also create job opportunities, underpinning our view for fixed investment and private consumption to support the acceleration of GDP growth over the coming quarters.” (Sorry, folks—we can’t link to the report for copyright reasons.)

Abu Dhabi’s National Central Cooling Co. (Tabreed) plans to acquire assets in markets like Saudi Arabia and Egypt starting this year, CEO Jasim Husain Thabet told Bloomberg TV. Tabreed would seek to use project financing to fund the acquisitions while contributing about 20-25% of the transaction value from its own cash, Thabet says. Bloomberg estimates that Tabreed could be targeting assets valued at around USD 1 bn as Thabet says the company has about USD 299 mn in cash.

M&A WATCH- Egypt Kuwait Holding (EKH) received the go-ahead from the Financial Regulatory Authority on Thursday to make a mandatory tender offer to acquire 99% of Delta Insurance, according to Al Mal. EKH is looking to acquire the remaining 16.9 mn shares (67.97%) valued at EGP 20 a share, which would value the transaction at EGP 338 mn. EKH had announced in a regulatory filing (pdf) earlier last month that it had received all the necessary approvals to hold the MTO.

EFG Hermes topped the EGX’s brokerage league table for January with a 17.1% market share, according to figures released by the Egyptian Exchange (pdf). CI Capital placed second with a market share of 12.9%, followed by Beltone Financial (7.7%), Pharos Holding (5.2%) and Pioneers Holdings (4.8%).

Five Egyptian investment banks took home hardware from the MENA Fund Manager Performance Award 2018 in Dubai, winning a total of nine awards. Acumen Asset Management was the big Egypt winner of the night, clinching three awards: Best balanced fund, best MENA equity fund of under USD 75 mn, and MENA equity fund of the year. EFG Hermes Asset Management won two awards: one for best Sharia compliant equity fund, and one for fixed income fund of the year. CI Capital Asset Management won best fixed income fund for its CIB Money Market Fund (Osoul), and best Egypt equity fund for the CIB Egypt Equity Fund (Estithmar). HC Securities was named best Egypt asset manager, while Rasmala Egypt Asset Management won outstanding performance and best sharia-compliant fixed income fund. You can see the full roster of winners here.

IPO WATCH- Prime Holding to manage EGP 500 mn IPO of education-focused company: Prime Holding expects to take an education company public in an EGP 500 mn offering on the EGX before the end of 2018, Vice Chairman Mohamed Maher Aly said yesterday. Aly declined to name the company, but suggested there will be retail and institutional tranches to the offering, according to Al Masry Al Youm. Additional details on the size and timeline of the transaction were not disclosed.

Mmmm… Muffins: Leading snack food producer Edita has launched the Todo Mini Muffins, their first new product in 2018, according to a company statement (pdf). Todo Mini Muffins will be priced under EGP 5 and are part of Edita’s cake segment, a key contributor to revenues in 2017.

GASC changes wheat import terms in latest tender: State grain buyer, the General Authority for Supply Commodities (GASC), changed the terms of importing wheat to traders in a Friday tender, traders tell Reuters. The change was meant to calm wary suppliers, some of whom shunned recent state tenders after a surge in costs faced by suppliers if they fail to unload their ships on time. GASC set a cap on demurrage fees, with suppliers now responsible for only the first 12 days of demurrage at a cost of USD 12,000 per day. Suppliers had previously been responsible for any duration and all demurrage fees accrued. GASC also hiked sieving fees to USD 3 per tonne from USD 2 previously. Traders said the new fixed-rate system would better allow them to calculate their costs and therefore reduce risk, though it would likely drive up offer prices. GASC on Friday also reduced protein requirements for major origins to between 11-11.5%.

New terms haven’t gotten GASC lower prices: This comes as GASC bought 180k tonnes of Russian wheat on Friday at an average price of USD 219.45 per tonne, with delivery set at 5-15 March, Reuters Arabic reports. Tom Houghton notes for Agricensus, that the higher price comes despite the new term changes and with wheat futures seeing a 3% drop.

Egypt to complete development on Zohr one year ahead of schedule: Egypt will complete the development of the Zohr gasfield at the beginning of 2019, instead of the end of the year, Oil Minister Tarek El Molla said on Thursday, according to Reuters. Egypt had been speeding up the development of the giant gasfield, with early phase production commencing ahead of schedule last December. Speedy development of the field had helped Egypt move forward its plans to cut imports of LNG from late 2018 to July.

The International Islamic Trade Finance Corporation (IITFC) opened a USD 400 mn credit line for Egypt to buy petroleum products as part of the final tranche of a USD 3 bn financing agreement signed in 2015, CEO Hani Sonbol told Reuters on Thursday. The IITFC will begin implementing a new USD 3 bn financing agreement to fund fuel and other vital commodities, signed last week, in 1H2018, Sonbol said. He expected the corporation’s trade finance portfolio to rise to USD 5-5.5 bn in 2018 from USD 4.9 bn in 2017.

BeIN rejects EGP 400 mn fine, says it is politically motivated: A decision by the Cairo Economic Court to fine beIN Media Group EGP 400 mn “sends a deeply troubling message to any international entity seeking to do business in Egypt,” beIN says. The group says it “categorically rejects” the decision and accused the judgment of being “based on unfounded and politically motivated allegations.” It says the claim “that beIN violated competition law by offering bundled sports packages ignores standard market practice in the PAY TV industry not only in the MENA region, but around the world.” BeIN says it will appeal.

As Careem eyes regional expansions, the company is attempting to adapt to local regulations as well as traditions, Adam Popescu writes for Bloomberg. In Saudi Arabia, the company’s biggest market, Careem has begun recruiting and training thousands of women to act as on-demand chauffeurs as the country prepares to issue its first driver’s licenses to women in June. In Pakistan, Careem put marriage matchmakers known as rishta aunties in their cars with passengers, generating criticism that the company seemed to be pushing women toward more conservative social norms. In Egypt, however, where ride-sharing services may be required to place servers with Egyptian user data inside the country under the new Ride-hailing Apps Act, Careem has declined to comment on whether it would choose to do so or leave the country.

EARNINGS WATCH- Credit Agricole Egypt announced that its net profit after tax increased to EGP 1.96 bn in 2017 from EGP 1.35 bn in 2016. The bank’s interest income also increased to EGP 4.80 bn during the year from EGP 3.35 bn in 2016.

CABINET ROUNDUP- The Ismail Cabinet — which met on Thursday for the first since Prime Minister Sherif Ismail returned from medical leave — approved amending a training and education cooperation agreement with the US, which would see aid under the program increased to USD 79 mn, and the duration of the program extended to 2022. Other actions taken by the cabinet include establishing a Chinese technology college at Suez Canal University, according to a statement from the cabinet.

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Image of the Day

Hundreds of runners were spotted sprinting across Aswan this weekend for the Magdi Yacoub Heart Foundation’s Aswan42 Marathon. Organized in collaboration with The Trifactory, the charity event brought together runners from 21 countries. You can learn more here.

Egypt in the News

Topping coverage of Egypt in the international press is the discovery of a 4,400-year-old tomb near the Giza plateau over the weekend. The tomb belongs to Hetpet, a high-ranking female official from the fifth dynasty and houses walls of well-preserved murals depicting Hetpet’s life. The discovery is receiving much ink, with outlets, including The Independent and BBC noting it.

That said, the biggest story on Egypt this morning is a piece in the New York Times in which former Cairo bureau chief David Kirkpatrick suggests that Egypt and Israel are working together so closely in Sinai that Israel is launching air strikes there with Cairo’s permission. “For more than two years, unmarked Israeli drones, helicopters and jets have carried out a covert air campaign, conducting more than 100 airstrikes inside Egypt, frequently more than once a week.”

Also in the Times over the weekend: US President Donald Trump is silent as “autocratic leaders are engaging in increasingly brazen behavior,” the newspaper’s Cairo boss, Declan Walsh, writes. Egypt is among them, Walsh writes, and “Mr. Trump is not alone in his silence over countries like Egypt. The leaders of Britain, France and Germany, also grappling with the surge in populist politics in their own countries, have said little about Mr. Sisi’s election crackdown as well.”

Tunisia and Sudan have the most to learn from Egypt’s economic reform story, particularly on how to earn popular political trust in a high-inflation environment, Brendan Meighan writes for Lebanon’s the Daily Star.

Egypt is witnessing the worst deterioration of human rights over the last several decades as President Abdel Fattah El Sisi ends his first four-year term in office, Matthew Bell writes for PRI.

Back to archaeology: The development of the Giza Plateau is set to start by mid-2018, according to Antiquities Minister Khaled Anani, who said that the the project will attempt to make the area a little more friendly to tourists by designating specific areas for photographers and peddlers as a start. Good luck with that…

Separately, an Italian archaeology mission started on Thursday the third radar scan in the tomb of King Tutankhamun in Luxor to discover secret chambers, the Ministry said in a statement.

On Deadline

The private sector is Egypt’s best bet for real economic growth and the state must pave the way for it to flourish, Fahim Mostafa writes for Al Borsa. Mostafa encourages the government to take the backseat and work as a regulator of the economy rather than a main actor. He also says that more legislative reform is needed to encourage private investment, stressing a need for it to be supported by key policy changes, such as a gradual decline in interest rates and enlisting the private sector’s help in managing public services.

Diplomacy + Foreign Trade

Egypt has welcomed the US decision to list the Hasm and Liwaa Al Thawra militant groups as “Specially Designated Global Terrorist” groups, Foreign Ministry Spokesperson Ahmed Abu Zeid said in a statement.

The recent cut in US funding for UNRWA puts the region’s stability and security at risk, Arab League Secretary General Ahmed Abul Gheit said on Thursday, Reuters reports. UNRWA Chief Pierre Krähenbühl has asked Arab nations for funds to fill the gap caused by the US cut, describing it as “the most severe crisis” in the agency’s history.

Belarus is considering partnering with the National Organization for Military Production (NOMP) on the manufacturing of vehicles and machinery, according to an embassy statement. Preparations are also underway to inaugurate the Minsk Automobile Plant (MAZ) truck production line at NOMP’s Helwan factory.

Energy

Electricity Ministry developing new risk management framework for projects

The Electricity Ministry is working on a new risk management framework for financing electricity projects, ministry sources tell Al Borsa. The Egyptian Electricity Holding Company and the state Credit Guarantee Company will form a fund that will provide EGP 50 mn in loan guarantees to projects, they added. The ministry is also reportedly pitching the new framework to financial advisers (who will play a hand in the system) and banks.

Egytrans completes transport contract for Beni Suef and new capital power plants

The Egyptian Transport and Commercial Services Company (Egytrans) has fulfilled a EGP 90 mn contract to transfer components, including turbines and generators, to the site of Siemens’ power plants in Beni Suef and the new administrative capital, Egytrans Chairman Abeer Leheta tells AMAY. The 2016 agreement was a strong contributor to Egytrans’ revenue growth last year, Leheta adds.

Basic Materials + Commodities

Agriculture Minister issues new regs on inspection of exported cargo

Agriculture Minister Abdel Moneim Al Banna issued a decision yesterday that allows the Quarantine Authority to contract accredited, privately-run labs to test samples of cargo being examined ahead of export, Al Shorouk reports, citing a ministry statement. Testing costs will be set based on individual agreements with each of the contracted labs. The decision means to reroute some of the backlog at the government’s central testing facilities, which has been growing since tighter inspection regulations were issued, mandating that shipments be examined at various stages of their preparation. The government has been more stringent about controlling the quality of goods marked for export after several Arab countries issued bans on a number of Egyptian crops for containing unsafe levels of residual pesticides. The Agricultural Exports Council had said earlier in January that it was close to sealing an agreement with a European labs that would work in tandem with Egyptian inspectors to test cargo before its approved for shipping.

Eastern Company plans to double exports next year to boost FX income, cover costs

Eastern Company is planning to double its exports next year in order to boost its foreign currency revenues, sources tell Youm7. The company will target markets in Africa and the GCC primarily, they said.

Manufacturing

Bamag-Samcrete consortium drops arbitration case against Abu Qir Fertilizers

A Bamag-Samcrete consortium has dropped an arbitration case against Abu Qir Fertilizers with the Cairo Regional Centre for International Commercial Arbitration, Abu Qir said in a bourse filing on Thursday (pdf). The dispute, which was raised in December of last year, is over Abu Qir had enacting delay penalty clauses in the contract over work on its factory’s EGP 225 mn water treatment facility, Al Mal reports.

Six investment proposals submitted to East Port Said

Six foreign firms have approached the East Port Said Development Company to acquire space for new projects in the area, Commercial Director Ahmed El Mofty tells Al Borsa. While he doesn’t name the firms, El Mofty adds that the company received offers from German auto and food producers, an Indian petrochemicals manufacturer, an Emirati logistics and port services provider, and a Ukrainian home appliances maker. El Mofty did not disclose details on the timeline or value of the proposed investments.

Real Estate + Housing

New Administrative Capital Co. in talks with Chinese company to develop 14k feddans

The New Administrative Capital Company is in “advanced talks” with a major Chinese firm to develop 14k feddans into a complete housing and industrial city, company spokesman Khaled El Hosseini tells Al Masry Al Youm. El Hosseini shied away from naming the company or revealing any details on the expected investment value.

Tourism

Alshaya group looking to buy hotels in Egypt governorates

Kuwait’s Alshaya Group is looking to buy three and four-star hotels across Egypt, starting with Cairo, Giza, and Alexandria, Al Mal reports. The group is also making arrangements to meet with the Egyptian General Company for Tourism and Hotels (EGOTH) to discuss the possible signing of management and operation contracts for historic hotels in Cairo. EGOTH said last month that it was reviewing two offers from foreign and local companies for the hotel’s EGP 1.2 bn renovation and development project, and would announce the winner in February.

Telecoms + ICT

ITIDA to cover 2.5% of interest payments on tech sector SME loans

The Information Technology Industry Development Agency (ITIDA) has launched a support initiative to cover 2.5% of interest payments on loans to SMEs in the ICT and tech sectors, a government source tells Al Borsa. Interest rates from banks supporting the initiative currently vary between 5-7%.

Automotive + Transportation

Buseet to expand into Dubai “soon”

Cairo-based ride-hailing app Buseet will launch operations in Dubai “soon”, the company announced on Facebook. The announcement comes after the on-demand bus service made it to a startup acceleration program offered by Startup Boot Camp in Dubai. Buseet recently expanded into Alexandria after launching the service in Sahel.

AIB and ValU sign agreement to provide discounted loans to Uber drivers

The Arab Investment Bank (AIB) will be offering Uber drivers with facilitated funding to finance their new car purchases through EFG-Hermes’ ValU platform, Al Masry Al Youm reports. The service, which goes into action next week, will provide drivers with the 20% down payment on the vehicle at a 5% interest rate. EFG launched its fintech arm ValU back in December.

Banking + Finance

Sphinx Private Equity plans to set up USD 70 mn investment fund this year

Sphinx Private Equity Management is planning to set up a new USD 70 mn fund by the end of the year to invest in mid-sized companies, Chairman Marianne Ghaly tells Al Masry Al Youm.

Corplease issues EGP 1.074 bn securitization bonds through five banks

Corporate Leasing Company (Corplease) has issued EGP 1.074 bn in securitization bonds through a five-bank consortium, Al Masry Al Youm reports. The consortium includes CIB, Banque Misr, the National Bank of Egypt, AAIB, and Suez Canal Bank, which acted as managers, promoters, and guarantors. The issuance has been divided into four tranches with 13-month, 3-year, 5-year, and 7-year tenures, an unidentified source tells the newspaper. The Financial Regulatory Authority had approved the issuance last month.

Sherif Samy joins Endowments Authority investment committee

Former Financial Regulatory Authority (FRA) boss Sherif Samy joined the Endowments Authority’s Investment Development Commission, which is expected to draft a comprehensive strategy for the authority in and out of the capital market, according to Al Mal.

Other Business News of Note

Oriental Weavers looking at Indonesia and Brazil for a carpet factory

Oriental Weavers is looking to establish a new factory to produce carpet fibre in either Brazil or Indonesia, Chairman Mohamed Farid Khamis said yesterday, Al Borsa reports. The company is also close to finalizing feasibility studies for a USD 1.1 bn polypropylene plant in Port Said and is planning to soon launch a USD 160 mn project to grow plants and herbs used in medical production and perfumes. Khamis had said last month that his company was also spending EGP 120 mn to set up new production lines that will be funded through a EUR 9 mn loan from QNB Alahli.

Egypt Politics + Economics

Opposition forces denounce President’s warning against boycotting elections

Opposition figures who called for a boycott of the elections denounced President Abdel Fattah El Sisi’s warnings last week, Reuters reports. The group — dubbed the the Civil Democratic Movement and includes rights lawyer Khaled Ali, former MP Mohamed El Sadat, and former anti-corruption head Hisham Genena — called the speech an attempt “to spread fear among Egyptian voters” which “undermines … the integrity of the electoral competition”. They also attacked his threat of calling a mandate from the people on the street.

Administrative Court delays its ruling on Dakroury’s appeal against presidential decree bypassing him as State Council head

The Supreme Administrative Court postponed issuing its ruling on Council of State (Maglis El Dawla) judge Yehia El Dakroury’s appeal against the presidential decree that bypassed him as the head of the council, Ahram Gate reports. The court deferred its ruling until the Supreme Constitutional Court — which is a higher judicial power — issues its own decision on the matter. President Abdel Fattah El Sisi had appointed Ahmed Aboul Azm as head of the judicial body last July, despite El Dakroury being the only nominee for the post based on his seniority. The judges had presented one instead of three nominees for the job to protest the controversial Judicial Authorities Act.

On Your Way Out

Uber Egypt signed a contract with MS Commercial yesterday to feature Mohamed Salah as its brand ambassador for 2018, the ride-hailing service company announced on social media. The partnership includes shooting an advertising campaign with the football star, as well as selling limited signed merchandise for the fans, according to Digital Boom. Uber Egypt also signed with Al Ahly players Ahmed Fathy and Saad Samir.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.62 | Sell 17.72
EGP / USD at CIB: Buy 17.60 | Sell 17.70
EGP / USD at NBE: Buy 17.63 | Sell 17.73

EGX30 (Thursday): 15,089 (+0.3%)
Turnover: EGP 1.0 bn (11% BELOW the 90-day average)
EGX 30 year-to-date: +0.5%

THE MARKET ON THURSDAY: The EGX30 ended Thursday’s session up 0.3%. CIB, the index heaviest constituent closed up 0.8%. EGX30’s top performing constituents were Egypt Aluminum up 2.3%; Global Telecom up 1.3%; and Egyptian Resorts up 1.3%. Yesterday’s worst performing stocks were AMOC down 1.9%; Emaar Misr down 1.8%; and Elsewedy Electric down 1.2%. The market turnover was EGP 1.0 bn, and local investors were the sole net sellers.

Foreigners: Net Long | EGP +13.3 mn
Regional: Net Long | EGP +0.9 mn
Domestic: Net Short | EGP -14.2 mn

Retail: 51.6% of total trades | 52.1% of buyers | 51.1% of sellers
Institutions: 48.4% of total trades | 47.9% of buyers | 48.9% of sellers

Foreign: 23.7% of total | 24.4% of buyers | 23.1% of sellers
Regional: 10.3% of total | 10.3% of buyers | 10.2% of sellers
Domestic: 66.0% of total | 65.3% of buyers | 66.7% of sellers

WTI: USD 65.45 (-0.53%)
Brent: USD 68.58 (-1.54%)

Natural Gas (Nymex, futures prices) USD 2.85 MMBtu, (-0.35%, March 2018 contract)
Gold: USD 1,337.3 / troy ounce (-0.79%)

TASI: 7,656.7 (+0.08%) (YTD: +5.95%)
ADX: 4,612.33 (+0.22%) (YTD: +4.86%)
DFM: 3,412.26 (+0.53%) (YTD: +1.25%)
KSE Weighted Index: 412.82 (+0.2%) (YTD: +2.84%)
QE: 9,207.01 (+0.03%) (YTD: +8.02%)
MSM: 5,035.23 (+0.71%) (YTD: -1.26%)
BB: 1,357.68 (+0.52%) (YTD: +1.95%)

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Calendar

3-4 February (Saturday-Sunday): Egypt Investment Forum, Semiramis Intercontinental Hotel, Cairo.

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

08-11 February (Thursday-Sunday): Furnex & the Home international trade fair, Cairo International Convention Center.

10-12 February 2018 (Saturday-Monday): Third Africa STI Forum, 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.

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): Labor 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.

28 April 2019 (Sunday): Easter Sunday, 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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