Tuesday, 13 February 2018

So much oil and gas…

TL;DR

What We’re Tracking Today

Today is the accidental Enterprise Oil & Gas issue, as coverage of the EGYPS energy conference dominated the local press and seeped into the foreign press on what was a severely slow news day.

And before you read further: It rained city-wide overnight, so you may want to start your commute a bit earlier than usual this morning: Expect messy streets and high probability of gridlock. Heavy winds were just dying down outside Enterprise Global Headquarters in the People’s Democratic Republic of Maadi as we began dispatch.

Today’s weather: Cloudy with sunny periods and an afternoon high of 19°C. Expect more of the same through Friday before we see scattered showers Saturday and Sunday, according to our favorite weather app.

The EGX30 followed global markets up yesterday, advancing 0.4% by the close of the session as markets from Asia to Wall Street found firmer footing in the first trading day after a week that had seen the S&P 500 post its worst one-week losses in more than two years. The S&P 500 gained 1.4% yesterday and the Dow rose more than 400 points, CNBC reports, prompting at least one analyst to suggest that it looks as if we’re “in a corrective phase rather than the start of a bear market.” Apple, Amazon and Netflix were among yesterday’s top gainers in New York.

Are share buybacks going to come back to bite US and European markets in their collective behinds? That’s the question asked by Bloomberg’s Tracy Alloway as she zeroes in on the role of corporate share buybacks—fueled by low interest rates—in smoothing out volatility. She quotes Chris Cole of Artemis Capital Advisors, who notes that companies have bought up USD 3.8 tn worth of shares since the global financial crisis. If these companies are on the sidelines as volatility-linked products and “implicitly short-vol” strategies blow up, he says, then the events of last week are “just the appetizer for the unwind that is about to come.” H/t Haitham A.

MPs are going to get tardy slips; notes home to parents could be next: House Speaker Ali Abdel Aal is rolling out a tardiness and absence policy to whip our elected representatives into shape, Ahram Gate reports. Abdel Aal said the days of leniency are now over and that he will no longer allow MPs to enter sessions past 10:30 am, blaming parliamentarians for causing him anxiety with their consistent lateness.

MUST READ- Where did your pay raise go? It may have become a bonus. The New York Times looks at how variable comp—long the staple of the finance and legal industries, among others—has spread across sectors in the United States. “A growing preference among employers for one-time awards instead of raises that keep building over time has been quietly transforming the employment landscape for two decades. But it was accelerated by the recession’s intensity, which made employers especially cautious about increasing labor costs.” Particularly relevant to Egyptian companies outside of banking and finance who are looking at their comp strategies in our high-inflation environment.

It’s a big day for: South Africa, where the ruling ANC has reportedly given President Jacob Zuma 48 hours to resign. The FT’s Gideon Rachman looks at what’s at stake for all of Africa.

And we’re not the only ones heading for a March election: Italy, one of our largest trade and tourism partners, is heading to the polls on 4 March. The Financial Times has your backgrounder here. Look for efforts to make the Regeni case a campaign issue.

A Dubai gold trader is the first in the Mideast to get a license to trade cryptocurrencies, Bloomberg reports.

For the iSheep among you: How Apple plans to root out bugs, revamp iPhone software, from wunderkind reporter Mark Guzman, now of Bloomberg. The good news: Apple will make it possible to run side-by-side instances of the same app on iPad, and apps on the iPad will be allowed to run multiple windows in tabs, just as Safari allows today. The bad news: Don’t expect those features to roll out until 2019.

PSA #1- Cairo residents may not be getting their usual reprieve from traffic this weekend as maintenance work is scheduled to take place on two sections of 6 October Bridge just over the Ramses Square area from midnight on Thursday to 6am CLT on Sunday, according to AMAY.

PSA #2- Tomorrow is Valentine’s Day, which we unsentimentally dismiss as a “Hallmark holiday” designed by the capitalists and their running dog lackeys in the greeting card, flower and chocolate industries to drive sales. Plan accordingly.

What We’re Tracking This Week

It’s interest rate week as the CBE’s Monetary Policy Committee meets on Thursday to set interest rates. Most analysts, including HC Securities’ Chief Economist Sara Saada, see a limited interest rate cut coming this week as inflation figures improve and the onus for growth shifts away from legislative reforms to interest rate cuts. Saada sees (pdf) the cut will be limited to 100 bps at its upcoming meeting, however, to balance possible risks to monetary policy easing. See also takes from Pharos Holding and Arqaam, both of which we noted earlier this week.

On The Horizon

The London Business School is holding its annual Middle East Conference on 2 March. Speakers this year will include Qalaa Holdings Chairman Ahmed Heikal and founding partner of Zulficar & Partners Mona Zulficar.

Enterprise+: Last Night’s Talk Shows

Not sure if this is the EGYPTIAN SEQUEL TO GROUNDHOG DAY or to the NIGHT OF THE LIVING DEAD: Islamist politics and the future of state-owned companies dominated the airwaves last night. The talking heads zeroed in on separately televised interviews of former top auditor Hisham Genena and the Islamist former presidential candidate Abdel Moneim Aboul Fotouh. Meanwhile, the Minister of Public Enterprise assures us that only two of the nation’s eight public-sector holding companies are really loss-making (if you squint and turn your head the right way while reading their financial statements after consuming multiple ethanolic beverages).

Hona Al Asema’s Lamees Al Hadidi slammed Genena’s interview with El Watan TV in which he claimed to be in possession of incriminating evidence against the Supreme Council of the Armed Forces (SCAF) — which took charge of the country after the 2011 uprising — that would secure former military chief of staff Sami Anan’s release from detention. Lamees said Genena’s appearance on a channel known for its affiliation with the Ikhwan was “unacceptable” and dismissed his alleged documents as fabrication that is more likely to harm Anan’s case.

Lamees was far less condemning of Aboul Fotouh’s interview with statelet media outlet Aljazeera, describing it as a purely political act that is to be expected from an opponent of President Abdel Fattah El Sisi. She pointed out that Aboul Fotouh’s statements mean to drive a wedge between El Sisi and the Armed Forces (watch, runtime 21:10).

Al Hayah Al Youm’s Tamer Amin railed against Aboul Fotouh for the interview, which he said serves only to tarnish Egypt’s image abroad (watch, runtime 6:59).

Over on Kol Youm, Amr Adib mimicked his better half’s disapproval of Genena’s claims, questioning the logic behind waiting this long to make the threat (watch, runtime 5:04).

Adib then had a chat with Foreign Ministry spokesman Ahmed Abu Zeid about US Secretary of State Rex Tillerson’s visit, which Abu Zeid said reflects the importance Washington places on dialogue with Cairo (watch, runtime 7:26).

Back on Hona Al Asema, Abu Zeid also told Lamees not to read too much into Tillerson’s statements about holding fair and transparent elections, playing them down as a routine demand the US would make of any country (watch, runtime 4:10).

Lamees took note of Daesh’s video warning of attacks ahead of the March election (full story in Speed Round), which MP and journalist Abdel Rehim Ali interpreted as the group’s swansong and proof that the military’s operations in Sinai are effective (watch, runtime 8:55). Ahram Center for Political and Strategic Studies researcher Ahmed Kamel El Beheiry, however, said that the group meant to show strength with the statement (watch, runtime 4:41).

Public enterprise boss lays out latest plan for state-owned companies: Lamees host also sat down for an extended talk with Public Enterprises Minister Khaled Badawy on the performance of state-owned companies, which Badawy expects to continue improving alongside the overall economy. Badawy told Lamees that his ministry is looking at a shakeup in companies’ management to help boost performance. He also said that only two of the country’s eight holding companies are making losses, whereas the rest are turning profits (watch, runtime 3:08).

Textiles in particular are continuing EGP 2.7 bn in (annual?) losses, he said, adding that the 35 textile companies are drowning in a collective EGP 7-10 bn in debts owed to the National Investment Bank. The government is looking into repaying these debts by selling off some of the companies’ assets, which he said were last valued at EGP 90-100 bn prior to the EGP float (watch, runtime 1:51).

Badawy remained tight-lipped on the state’s IPO program, saying only that there are 10 companies in the IPO pipeline (watch, runtime 3:45).

The minister also touched on the government’s strategy for the tourism sector, which rests heavily on renovating and polishing up some of the country’s hotels, listing Aswan’s Old Cataract, Luxor’s Winter Palace, and Cairo’s Mena House as some of the best-poised for high ratings (watch, runtime 15:29).

Over on Masaa DMC, Oil Ministry spokesman Hamdi Abdel Aziz gave host Eman El Hosary the low-down on the new 95-octane formula announced at the EGYPS conference and how it differs from the product currently on the market (we have details in Speed Round, below) (watch, runtime 3:51).

Back on Kol Youm, Adib hailed the outcomes of the EGYPS conference, including BP’s announcement that it will begin production at the Atoll gas field ahead of schedule (Also covered in Speed Round). He piled on the praise for the government’s efforts to slash red tape and facilitate procedures for IOCs to operate in Egypt (watch, runtime 37:27).

Speed Round

Speed Round is presented in association with

Egypt is stepping up its drive to land energy investment in the Gulf of Suez, Oil Minister Tarek El Molla said yesterday. The minister announced an agreement with an international company to conduct a seismic survey of the Gulf of Suez to attract exploration investment in the area, but “did not name the company or give any details on the agreement,” Reuters notes. He added that Egypt is developing a new online database in cooperation with oil and gas majors to log geological and seismic data on Egypt in a bid to promote Egypt’s fields to foreign investments, Youm7 reports.

(That last bit is a play on the trend in the wider industry of making more data available to oil and gas majors, as the Financial Times notes in its Big Read: Drillers turn to big data in the hunt for more, cheaper oil.)

New and improved 95 octane formulation hits the market: Speaking at the launch of the EGYPS Petroleum Show 2018, El Molla said that the ministry has introduced a higher-quality formulation of 95 octane fuel to the market that is more compatible with newer car engines. The minister confirmed that the fuel will be sold at the same price of EGP 6.60 per liter through Exxon Mobil and Total gas stations as a first stage. He added that work is underway to improve the quality of fuel products in cooperation with global oil products marketers.

How many shipments does Egypt have to import before it ends LNG tenders? “Very few,” El Molla said without specifying how many LNG shipments the country has to go before tenders grind to a halt, according to Reuters. Observes expect that will be by the end of the year at the latest. The minister added that Egypt’s current gas production stands at 5.5 bcf/d.

We’re already a regional energy hub? Also speaking at the conference was OPEC Secretary General Mohammed Barkindo, who said that Egypt has become a regional energy hub, according to Al Shorouk.

INVESTMENT WATCH- BP pledges to invest USD 1 bn this year as production from Atoll gas field begins seven months ahead of schedule: BP plans to invest USD 1 bn in Egypt this year, BP Group CEO Bob Dudley said on the sidelines of the conference, Reuters reports. The statement comes as BP announced that it has started production at the Atoll Phase One project in the North Damietta concession in the East Nile Delta seven months ahead of schedule and 33% below the initial cost estimate. Atoll is now producing 350 mcf/d and 10,000 bpd of condensate, with the main reservoir in the field containing an estimated 1.5 tcf of gas and 31 mn bbp of condensates. Phase 1 of Atoll, which has seen nearly USD 1 bn in investments, is the first new project to come into production for BP in 2018. “The longstanding partnerships we have in Egypt allowed us to fast-track Atoll’s development and deliver first gas only 33 months after discovery. This is a further demonstration of our commitment to help realize Egypt’s oil and gas potential and meet the increasing demand from its growing population,” Dudley said.

“The government owes us no money,” he added. Egypt, whose arrears to international oil companies had reached USD 2.4 bn as of the end of FY2016-17, has pledged to eliminate arrears owed to foreign oil companies by the end of June 2019 and not to accumulate more.

SOUND SMART: The Oil Ministry doesn’t owe anything to BP and has paid down arrears to other majors, insiders tell us, but it’s squeezing the cash flows of mid-sized producers. They’re the next pressure point in the chain.

INVESTMENT WATCH- BP wasn’t the only one pledging new investments, as Dubai-based Emirates National Oil Company (Enoc) said yesterday it is eyeing new investment in Egypt through its wholly-owned subsidiary Dragon Oil, according to the National. “Investing in Egypt’s market, the third largest in Africa, complements our business strategy to go beyond the UAE and our commitment to industry-leading performance,” said Enoc group CEO Saif Al Falasi. Dragon Oil, which fully owns the East Zeit Bay offshore concession south of the Gulf of Suez. Enoc currently sells lubricants, greases, petrochemicals and aviation fuel to the Egyptian market and has plans expand its product offering here.

Production from the Zohr offshore gas field will reach 2.9 bcf/d by mid-2019, said Eni CEO Claudio Descalzi at the conference. The goal was to reach output of 1.8-2 bcf/d by the end of 2018 and then ramp up to 2.9 bcf/d by mid-2019, he added, according to Reuters.

Descalzi also spoke on the potential giant discovery in Cyprus’ Calypso 1 reservoir, saying that an appraisal well would have to be drilled to understand the real volumes there and that Eni would decide alongside France’s Total when to commit to that campaign. Asked whether it is believed to hold around 6-8 tcf, Descalzi said: “It could be more or in that range… for sure it cannot be less, but we have to understand it … It’s a good find that has merit to go ahead with additional investment.” He did not mention Turkey’s latest acts of aggression to hinder the development of Block 6.

IMF Managing Director Christine Lagarde singled out Egypt in her praise of the “courage” Arab countries have shown in implementing economic reforms, according to CNBC. “If we look at Egypt, which has gone through a really tough time, and where the Egyptian people have shown courage, and the Egyptian leader, courage — we have seen growth up more than 5 percent,” said Lagarde at the World Government Summit in Dubai. “When you see inflation going down, when you see [capital] coming back into the country, investors looking at Egypt as a good risk in which to set up new companies and create jobs, that’s the response,” she said.

“Big stabilization in Egypt is going to give rise to benefits for the people. And in all circumstances, whether it’s in Egypt, Jordan, Tunisia and all places we think of as difficult situations, we are very attentive that there be a social basis so that people who are at risk, people who are underprivileged, people who are exposed, have sufficient benefits to actually cope with the situation,” she added.

Lagarde warned, however, that changes in the world economy and energy prices mean that many countries across the Arab world need to undergo significant changes in order to survive.

Washington stands by Egypt and is “committed” to supporting it in its war on terrorism, US State Secretary Rex Tillerson said yesterday after meeting with President Abdel Fattah El Sisi, according to an Ittihadiya statement (pdf). “The President noted that Egypt looks forward to forging closer economic cooperation with the US and to increasing American investments in Egypt,” read the statement.

Tillerson pledged that the US would continue to provide military and economic support to Egypt. Speaking at a press conference in Cairo on the first leg of his Middle East tour, Tillerson said that the US had provided Egypt with bns in military assistance. He did not, however, mention the near USD 300 mn in military assistance the US froze last year, citing human rights concerns.

…Foreign aid cuts expected, except for ‘friends’: His statements come as foreign aid workers expect US assistance to decrease sharply in the Trump administration’s 2019 budget proposal, especially after the Donald threatened to cut aid from countries that do not support US policies, according to the Washington Post. Analysts, including the Heritage Foundation’s Brett Schaefer, say that the move would not apply to strong US allies, among them Egypt, Jordan and Afghanistan.

Tillerson also stressed the need for free and fair elections in all countries, but did not comment directly on Egypt’s March presidential vote. Foreign Sameh Shoukry said during the conference that Egypt was committed to fair elections and upholding human rights.

As for the Palestinian-Israeli conflict, Tillerson said Washington remained committed to working for the peace process, adding that Trump’s recent decision to move the US embassy to Jerusalem did not set final boundaries for the city. He added that the final boundaries need to be decided by both sides. El Sisi had urged in his meeting with Tillerson the US to push forward the Israeli-Palestinian negotiating process “in line with international resolutions.”

Tillerson also commented on North Korea, saying that “it’s too early to tell” if recent signs of overture between North and South Korea at the Olympics mean that a genuine political process is beginning.

Shoukry added that Egypt and the US would hold 2 plus 2 talks on strategic cooperation sometime in the second half of the year.

You can catch the full press conference here (watch, runtime: 25:39).

Daesh calls for attacks during presidential elections as Operation Sinai 2018 intensifies: The Daeshbags have reportedly put out a video urging their fighters to stage terror attacks during next month’s presidential elections and warning Egyptians to stay away from polling centers, according to the Associated Press. The video, which calls the elections an act of apostasy, makes a brief mention of the Armed Force offensive in Sinai, suggesting it was made after the campaign began Friday. As for the offensive itself, the Armed Forces announced on Monday that 12 militants were killed and about 100 other suspected militants have been arrested and weapons caches destroyed. This would bring the announced deaths in the largest military operation in Egypt in years to 28 militants.

The Armed Forces also announced yesterday that it has launched a hotline service to allow citizens across the country to report suspected terrorists.

Iraq will follow Egypt’s model on economic reforms as it begins a USD 88 bn reconstruction process after three years of war with Daesh, Iraqi Central Bank Governor Ali Mohsen Al Allaq told Al Shorouk on the sidelines of an international donors’ conference in Kuwait yesterday. It is unclear whether this implies a possible devaluation of the IQD. An Egyptian government delegation led by presidential advisor for national projects Ibrahim Mahlab recently visited Baghdad to discuss Egypt’s role in reconstruction efforts there.

CORRECTION- Our friends at EFG Hermes are not planning to expand to Latin America, as reported by Al Mal. EFG Hermes clarified instead that they’re going to launch research coverage of some Latin American markets, including Peru and Argentina. The incorrect entry has been removed from our web edition.

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The Macro Picture

Emerging markets are coming out of the recent global selloff “looking better than their richer counterparts, especially the US.” Not only are developing economies “well supported by earnings growth,” but in the last two weeks, their levels of expected volatility collectively rose at a slower rate and degree than more developed counterparts, Srinivasan Sivabalan writes for Bloomberg. The smallest markets were even better off, as figures reveal that it was “some of the biggest and deepest markets in the developing world [that] suffered the worst meltdowns,” with around 80% of all EM losses in the past two weeks concentrated in China, Taiwan, South Korea, and India. China alone suffered stock losses larger than Brazil’s entire market. “In contrast, tiny markets such as Pakistan and Egypt outperformed others.” Egypt was the only one of its peers to make a small gain and see its market capitalization increase, thanks largely to the impact of the currency float.

Egypt in the News

The Supreme Media Council’s ban on SNL Arabia is topping coverage of Egypt in the English-language press this morning, with stories from the Guardian, AFP, Chortle, and Arab News. The show was suspended on Sunday for making [redacted] references and using inappropriate language.

Coming in second was US Secretary of State Rex Tillerson’s visit to Cairo at the start of his Middle East tour, which is being widely picked up by wires including Reuters and The Associated Press, as well as covered independently by news outlets including The New York Times, Washington Post, Asharq Al-Awsat, and Palestine’s WAFA news agency.

Also making the rounds were updates on the Egyptian Armed Forces’ anti-terror campaign in North Sinai and Daesh’s warning of attacks ahead of the March presidential elections, with Al Arabiya and Bloomberg noting casualties.

President Abdel Fattah El Sisi is using vast infrastructure megaprojects “to inspire a sense of national achievement and economic might” ahead of the upcoming presidential elections, Jared Malsin writes for The Wall Street Journal. “This is not investment [capital]. This is political [capital] … The long-term consequences of this are very negative for the economy. You think of the waste of resources at a time when the country is in desperate need,” Egypt expert Robert Springborg says, describing the most recent slew of megaprojects. Malsin says El Sisi’s “affinity for megaprojects fits into a pharaonic pattern of Egypt’s leaders building ambitious landmarks during their time in office.”

US President Donald Trump usually makes no effort to disguise how little he cares about human rights, Gary J Bass writes for The New York Times, criticizing displayed support for Egypt’s President Abdel Fattah El Sisi. “Instead of viewing human rights as a universal ideal, Mr. Trump invokes them only strategically, when they are useful as a geopolitical cudgel,” Bass writes. He adds that now it “falls to more decent democratic leaders — including Angela Merkel of Germany, Emmanuel Macron of France, Moon Jae-in of South Korea and Justin Trudeau of Canada — to champion freedom. The United States has sidelined itself from being taken seriously about human rights by electing Mr. Trump, and its global reputation will not begin to recover until he is sent packing.”

Egypt-based fintech startup Moneyfellows is working to launch “product-based circles, where users would get products they’re looking for, rather than cash”, founder and CEO Ahmed Wadi tells Entrepreneur Middle East. The web and mobile-based crowdfunding platform, which recently raised USD 600k in seed funding from Dubai-based Angel Investors and 500 Startups, has digitized the concept of a “Gameya” to make access to interest-free lending easier. Moneyfellows was part of the Barclays Egypt and Flat6Labs’ 1864 fintech startup accelerator.

The amount of private and public investment in Egypt’s tourism sector is indicative of the sector’s ongoing recovery, Daniella Cohen writes for The Media Line. Cohen points to projects such as the USD 3.3 bn Disneyland-style theme park being planned in Marsa Matrouh and efforts to revamp the area around the Giza pyramids to as examples of the length Egypt is willing to go to “revive one of its most important industries” and return to pre-2011 levels. She also says that Egypt’s involvement in massive regional projects such as Saudi’s Neom is expected to help drive visitor numbers.

Egypt is poised to again become a net exporter of liquefied natural gas, LNG World Shipping says. “The only obstacle standing in the way of the country’s re-emergence as a net LNG exporter over the next few months is another surprise decline in the output potential of the domestic gas fields.”

Also worth noting in brief:

  • Egyptian dating app Harmonica is developed taking into consideration local cultural norms and hanging romance for Egypt’s conservative millennials, New Statesman reports.
  • The improved ties between Egypt an Cyprus have raised Turkish concerns “over the past few years,” Mahmoud Fouly and Abdel-Maguid Kamal write for Xinhua, reviewing the regional tensions surrounding maritime border demarcation agreements.
  • A far-right Italian political party is up in arms over the Egyptian museum in Turin offering discounts to Arabic speakers, The New York Times reports. The party criticized the discount as being encouraging of Islamization and vowed to fire the museum’s director if the party, a part of a Silvio Berlusconi-led coalition, is elected, Bloomberg reports.
  • International outlets including Africa News and ENCA are taking note of Egyptian football fans’ recent return to the stadiums.

On Deadline

Egypt’s military offensive in Sinai must be complemented with a far-reaching development campaign to benefit the peninsula’s population, says Al Masry Al Youm’s Ahmed El Sawy. While a military strategy is necessary to address the militant insurgency, the state must enlist the help of civil society to address the needs of the peninsula’s inhabitants and demarginalize the local population. This is particularly important since these citizens are aiding the Armed Forces’ efforts by providing intelligence, without which the military strategy would not be as effective, El Sawy points out.

Worth Watching

Scientists in the University of Maryland have devised a new chemical they say can make wood stronger than steel. The chemical cocktail cooked up by Maryland University’s Liangbing Hu and his team densifies the wood to make it up to a dozen times stronger so that it can stop bullets, be used in the manufacturing of cars and airplanes, and even be used in construction, according to The Sun. The scientists believe the compound is a breakthrough in the search for a durable, renewable material that is cheaper than metal (watch, runtime 2:27).

Diplomacy + Foreign Trade

The Trade and Industry Ministry has renewed export tariffs on eight minerals and goods for another year starting from this month, an official statement said. These include quartz, raw granite and marble, and talcum powder.

Health + Education

NOMP signs MoU with Korea’s Medtech to build medical equipment factory

The National Organization for Military Production (NOMP) and its subsidiary Al Maadi Company for Engineering Industries have signed an MoU with Korean company Medtech to establish a factory for medical equipment, Al Shorouk reports. The factory is meant to cover both local market needs and export to other countries, according to Military Production Minister Mohamed El Assar.

Dubai Investments to invest USD 20 mn in developing SABIS schools in Africa

Dubai Investments PJSC is planning to invest USD 20 mn to fund the development of SABIS-operated schools in African countries, including Egypt, Gulf News reports. The investment will be directed towards Africa Crest Education Holdings, “which promotes education across Africa.” The International School of Choueifat is currently Egypt’s only SABIS-operated school.

Real Estate + Housing

El Shams Housing to spend EGP 235 mn this year on expansion plans

El Shams Housing And Urbanization Company is planning to spend EGP 235 mn this year to finalize land purchases in the new administrative capital and complete phase four of its Gardenia El Shams in 6 October City, Chairman Mahmoud Maghawry tells Al Mal.

Tourism

New museum to open Saturday in El Matareya

Antiquities Minister Khaled Anani will inaugurate the newly renovated museum in Cairo’s Matareya neighborhood on Saturday, according to Al Mal. Excavation work is ongoing in Matareya, where German and Egyptian archaeologists unearthed an eight-meter Ancient Egyptian statue in March last year, as researchers believe they can find more artefacts. The space around the museum is also being kept clear of street vendors.

Telecoms + ICT

IT and ITeS exports worth over USD 3.25 bn in 2017, study shows

Egypt’s IT and IT-enabled services (ITeS) export industry was worth over USD 3.25 bn in 2017, a study conducted by International Data Corporation (IDC) showed. IDC expects the volume of exports to grow at a compound annual growth rate of 13.4% from 2017 to 2020. The study also shows that the overall Egyptian IT/ITeS industry employed over 292k people in 2017 — a figure that is set to grow to 378k by 2020. “The technology innovation ecosystem is booming in Egypt, with the United Nations Development Programme (UNDP) selecting Cairo to host its first Regional UN Technology Innovation Lab (UNTIL) in Africa in 2017,” IDC says.

Banking + Finance

CBE sells USD 1.075 bn in one-year T-bills

The central bank announced selling USD 1.075 bn in one-year, USD-denominated treasury bills in an auction yesterday. Foreign and local financial institutions bought the T-bills at a weighted average yield of 3.295%.

Egypt Politics + Economics

Court sentences man to death over Coptic priest’s killing

A Cairo court has sentenced a man to death after he was convicted of killing a Coptic priest in Cairo last October, The Associated Press reports. The defendant Ahmed Saeed stabbed to death the 40-year-old cleric Samaan Shehata in Salam City and wounded another priest in the attack.

Finance Ministry targeting EGP 611 bn in tax revenues for FY2017-18

The Finance Ministry is targeting EGP 611 bn in tax revenues for FY2017-18, Vice Minister of Finance Amr El Monayer said yesterday, Youm7 reports. The ministry’s target would put tax revenues at 73.5% of GDP, up from 72% last fiscal year. Revenues had reached EGP 433 bn in FY2016-17, marking a 30% y-o-y increase.

Sports

Marwan El Shorbagy and Ali Farag pick up squash titles

Egypt’s Marwan El Shorbagy beat New Zealand’s Paul Coll in the 2018 Suburban Collection Motor City Squash Open finals in the US last week,according to Egyptian Streets. The victory makes Shorbagy the fifth Egyptian to pick up the title. The weekend also saw Ali Farag win the 2018 UCS Swedish Open over German Simon Rosner; making it his first world title in his career, reports Eurosport.

Cycling team wins African Championship

The national cycling team cleaned house at the African Indoor Championship in Morocco, picking up 12 gold medals, eight silver and three bronze, according to Al Wafd. The championships also saw Ibtisam Zayed and Dunia Rashwan qualify for the world championship in the Netherlands at the end of the month.

On Your Way Out

New York City-based startup CTRL-Labs is working on creating interface that can allow us to use our thoughts to communicate with computers. The technology is based on using sensors to capture and decode motor neurons (the electric signals our brain sends our muscles to get them moving) in order to turn them into direct commands that a computer can understand, neuroscientist and CTRL-Labs fonder Thomas Reardon told National Geographic in an interview, adding that he expects his tech’s most immediate impact will be on text messaging and typing. “I want to see computing break through to a different level of facility and value for people. That might sound abstract, but I really imagine things like, why do you use a keyboard to enter text into a machine? Why can’t I write a message to my wife from my pocket, with my hand still in my pocket?” he asks.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.63 | Sell 17.73
EGP / USD at CIB:
Buy 17.6 | Sell 17.7
EGP / USD at NBE: Buy 17.59 | Sell 17.69

EGX30 (Monday): 14,891 (+0.4%)
Turnover: EGP 1.1 bn (2% BELOW the 90-day average)
EGX 30 year-to-date: -0.9%

THE MARKET ON MONDAY: The EGX30 ended Monday’s session up 0.4 %. CIB, the index heaviest constituent closed down 0.6%. EGX30’s top performing constituents were Ezz Steel up 4.3%; Egyptian Resorts up 3.9%; and Palm Hills up 3.3%. Yesterday’s worst performing stocks were Amer down 3.3%; Telecom Egypt down 2.3%; and Global Telecom down 1.4%. The market turnover was EGP 1.1 bn, and foreign investors were the sole net sellers.

Foreigners: Net Short | EGP -83.1 mn
Regional: Net Long | EGP +79.8 mn
Domestic: Net Long | EGP +3.3 mn

Retail: 56.6% of total trades | 54.1% of buyers | 59.2% of sellers
Institutions: 43.4% of total trades | 45.9% of buyers | 40.8% of sellers

Foreign: 19.2% of total | 15.5% of buyers | 22.9% of sellers
Regional: 13.2% of total | 16.7% of buyers | 9.6% of sellers
Domestic: 67.6% of total | 67.8% of buyers | 67.5% of sellers

WTI: USD 59.25 (+0.08%)
Brent: USD 62.62 (-0.27%)

Natural Gas (Nymex, futures prices) USD 2.56 MMBtu, (-0.89%, March 2018 contract)
Gold: USD 1,325.7 / troy ounce (+0.76%)

TASI: 7,425.57 (+1.34%) (YTD: +2.76%)
ADX: 4,609.91 (+0.56%) (YTD: +4.81%)
DFM: 3,314.93 (-0.17%) (YTD: -1.64%)
KSE Weighted Index: 408.5 (-0.09%) (YTD: +1.76%)
QE: 8,987.51 (-0.63%) (YTD: +5.45%)
MSM: 5,002.87 (+0.18%) (YTD: -1.89%)
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Calendar

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 March (Monday): Egypt’s PMI reading for February released.

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.

02-03 May (Wednesday-Thursday): Cisco Connect Egypt 2018, Nile Ritz-Carlton Hotel, Cairo.

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 (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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