Wednesday, 21 February 2018

House leadership pushing through USD 15 bn Israel gas import agreement


What We’re Tracking Today

Amr El Garhy is projecting revenues in FY2018-19 will reach EGP 1 tn, a first in the country’s history, Finance Ministry sources told Al Mal on Tuesday. The statements come as the ministry has begun drafting the budget for the next fiscal year with the hope of introducing it to the House of Representatives next month, the newspaper said. Revenues for the current fiscal year were projected to reach EGP 838 bn. The ministry is also hoping to cap expenditures in the FY2018-19 budget to EGP 1.6 tn, up from EGP 1.3 tn in the current budget. Look for a budget deficit of c. 8.5% of GDP, down from a projected 9.5% in FY2017-18.

The ministry also wants you to know that you will be able to file your tax returns electronically as of next week, once the Tax Authority’s database and registration services come online. The ministry announced in a statement yesterday that the move to a digital tax platform is expected to improve Egypt’s global ranking in World Bank’s Doing Business report.

Azerbaijani Economy Minister Shahin Mustafayev is expected to arrive in Egypt today for talks on economic, technical, and scientific cooperation between the two countries.

Where is the year going? It’s nearly the end of February, and with it we are two-thirds of the way through the first quarter. And we’re already talking about the timing of the coming state budget. Time does accelerate as you age. Just sayin’.

In miscellany this morning:

US markets returned from a three-day weekend to snap a six-session winning streak that has prompted far more nervousness than usual as observers remain skiddish on fears of continued high volatility. (FT)

The recent correction that has everyone spooked was just an “appetizer, not the main course.” That’s still to come later this year, Morgan Stanley says, noting that developed markets “remain in the late stages of a late-cycle environment. Rising equities, rising inflation, tightening policy, higher commodity prices and higher volatility are (in our view) a pretty normal pattern if that view is correct.” (CNBC)

Bitcoin has so far “pretty much failed … on the traditional aspects of money,” says Bank of England Governor Mark Carney. (CNBC)

Beware companies that want to “move beyond their names,” as Coca-Cola CEO’s seems to want to do in her quest to ensure the company becomes “known or something other than soft drinks.” (WSJ)

If you’re a small business or a startup, hiring a full-time person to lead your recruitment and hiring process might be the best thing you can do to drive the growth of your firm, one CEO argues. (WSJ)

New study suggests that counting calories may not be the (only) way to lose weight: The authors of a piece for the Journal of the American Medical Association found that “people who cut back on added sugar, refined grains and highly processed foods while concentrating on eating plenty of vegetables and whole foods — without worrying about counting calories or limiting portion sizes — lost significant amounts of weight over the course of a year.” (New York Times)

Our friend Andre Valavanis, investor relations officer at GB Auto, won a difficult, eight-round welterweight boxing match against Latvian veteran Ivans Levickis on Saturday. The fight, organized by LB Sports Promotions, brings GB Auto-sponsored Valavanis one step closer to his second World Boxing Federation Intercontinental Welterweight Championship title. If you missed out on the live show, you can tune in to Mehwar TV tomorrow at 7pm CLT to watch the bout.

On The Horizon

Our friends at EFG Hermes are hosting their 14th annual One on One Conference in Dubai on Monday, 5 March. The three-day event is the largest investor conference globally focused on frontier and emerging markets and will bring together some 175 companies for discussions on what a year of shifting benchmarks — including oil production cuts and the prospect of US interest rate hikes — mean for emerging frontier markets.

Egypt’s Emirates NBI PMI reading for February will be announced on Monday, 5 March.

Enterprise+: Last Night’s Talk Shows

The nation’s talking heads remained happily obsessed with the USD 15 bn natural gas import agreement with Israel.

Kol Youm’s Amr Adib said people are starting to develop a better understanding of the scope of the agreement that Dolphinus Holdings signed with Noble Energy and Delek this week. He downplayed any notions about normalization with Israel and said that Egypt has a competitive edge in the region since it’s been developing its infrastructure and liquefaction capabilities for years (watch, runtime: 5:42).

House is getting in line to support the pact: House Energy Committee secretary Elsayed Hegazy thought along similar lines, telling Yahduth fi Masr’s Sherif Amer that Egypt is becoming a main regional gas hub and logistics zone, which demands we be open to all markets. Some in the House may feel differently, but objecting to the agreement would be counter to the national interest, Hegazy said. Still, he noted, the agreement will be subject to review by both the Ismail Cabinet and the House before anything is set in stone (watch, runtime: 8:30).

Still no state approval: Ministry spokesperson Hamdy Abdel Hamid confirmed the agreement has yet to receive the state approval. Abdel Hamid made the remarks in a talk with Al Hayah Al Youm’s Nahawand Serry (watch, runtime: 3:15).

On Hona Al Asema, Lamees Al Hadidi drew a distinction between political differences and the gas pact, which she said is ultimately in Egypt’s economic interests (watch, runtime: 1:13). She also spoke with Saudi analyst Abdel Aziz Al Mokbel, who said that geopolitical issues, particularly the rift between Turkey and Cyprus, will have limited impact on the industry (watch, runtime: 6:47).

Back on Kol Youm, Adib voiced out his frustration over the delay in the resumption of direct flights with Russia. He said the holdup doesn’t reflect the warming ties that both countries have tried to foster in recent years. He also said that it is flights between Moscow and Sharm El Sheikh, rather than Cairo, that should resume first (watch, runtime: 2:43) and (watch, runtime: 3:20).

Meanwhile on Masaa DMC, Osama Kamal aired a pre-recorded interview with Siemens’ CEO Joe Kaeser, who told the host that the three power plants in Burullus, Beni Suef, and the new capital are 97% complete and should be pumping 15,000 MW of power into the national grid by summer.

Siemens is also working on a 180 MW wind farm in the Suez Canal Economic Zone and planning to collaborate with France’s Engie to build another 650 MW project in the area, Kaeser also said, adding that the company is ready to build a plant in Egypt that could create as many as 1,000 new jobs (watch full interview: 28:06).

Kamal also spoke to Supreme Antiquities’ Council Secretary General Mostafa Al Waziri about the uproar that erupted after pictures of a renovated floor at Luxor’s Karnak Temple surfaced on social media, showing new tiles in place of the blocks placed there by our ancient predecessors. Waziri said the floor was only recently changed to make the temple more accessible to older people and those with disabilities (watch, runtime: 10:09).

Lamees was also on the case, calling up the man in charge of the temple, Mustafa Al Saghir, who confirmed the replacement happened back in in 2008-09 (watch, runtime: 3:42).

Speaking of the ancient, Lamees was the only host to take note of the rift between Wafd Party members over the date of their party elections (watch, runtime: 4:45). She also praised rights lawyer Khaled Ali for his bravado in handling the [redacted] harassment allegations against him (watch, runtime: 5:09).

Speed Round

Speed Round is presented in association with

The Oil Ministry dropped its biggest hint yet that the government will approve a USD 15 bn pact to import gas from Israel. “The agreement between [Noble Energy, Delek and Dolphinus] to import gas from Israel will be subject to Egyptian regulations governing gas imports,” Oil Ministry spokesperson Hamdy Abdel Aziz said in a statement on Tuesday (pdf). “Egypt’s strategy to becoming a regional energy hub and achieving an energy surplus by 2019 will involve Egypt importing gas from Israel and Cyprus,” he added.

And here’s the kicker: Importing gas from Israel will go a long way to getting past outstanding issues with international arbitration, said Abdel Aziz. This is the first overt indication by the government that the USD 1.76 bn arbitration award against EGAS and EGPC in favor of Israeli Electric — the Ismail Cabinet’s sticking point on any imports of gas from Israel — may be on its way to being resolved.

Quick resolution may be in Israel’s best interest, as its government should be collecting around 50% of all revenues from the Dolphinus sale, the Israeli Natural Gas Authority’s former chief economist, Miki Korner, tells Jerusalem Post. “As soon as one of the pipelines is activated — which could take a few years — operators of Israeli natural gas will getting around USD 1-1.5 bn annually,” he says. “The state gets to impose a 12.5% royalty tax on the revenue from natural gas” and will collect both income and excess-profit taxes in excess of 20% each. Korner notes that while the agreement is a reflection of good relations between the two countries, “gas exports could create complications, with commercial disputes and supply problems possibly shadowing otherwise strong security cooperation.”

The pact continues to capture the imagination of the international business press. Look for the agreement to kickstart economic momentum, Abu Dhabi Commercial Bank Chief Economist Monica Malik tells Bloomberg TV. “There are a number of positive developments, which should give positive tailwinds to the Egyptian economy,” Malik says. The development in Egypt’s own gas market is “far more important,” she adds, saying increased production will support the economy and improve external accounts. Salma Wardany added that Egypt could be facing “a possible over-abundance” of natural gas following the agreement, in a piece for Bloomberg.

The sticks-in-the-mud:

  • Haaretz’ David Rosenberg is grumpy that the gas pact hasn’t been celebrated in Egypt as much as it has in Israel (dude, subscribe to Enterprise—we’ve been cheerleading on this for three years now). Rosenberg says “Middle East politics” (words we have grown to hate) are bound to complicate things, even though the most natural thing is for East Mediterranean countries to export to Europe via Egypt.
  • One learned gentlemen in our House of Representatives is rushing to make Rosenberg’s case for him. Rep. Abdel Hamid Kamal is demanding that Oil Minister Tarek El Molla be summoned to explain why we’re going to buy gas from “an enemy of Egypt.” (Expect his grandstanding to last as long as a snowball on Cairo pavement in July before the powers that be ‘suggest’ he get with the program—the House Energy Committee is already lining up to push the agreement through whatever review process is necessary, as we not in Last Night’s Talk Shows, above.)

Gov’t to expand Nat Gas grid: In other gas-related news, the Ismail Cabinet approved legislation which would grant the EGPC and any company it appoints responsibility for expanding the natural gas grid and infrastructure, according to a cabinet statement.

Hey, Turkey, don’t even think about it: Meanwhile, Egypt’s navy has secured the Zohr gas field, the Armed Forces said in a statement on Tuesday. While the statement said the move was part of Operation Sinai 2018, we can’t help but feeling this is a message to Turkey, which is using gunboat diplomacy to intimidate Cyprus over developing its gas reserves as part of the Economic Exclusion Zone agreement with Egypt. “The eastern Mediterranean seems to be a new source of dispute between the two countries, as Turkey does not seem to want to resolve its problems with Cairo,” writes Ahmed Aleem for Al Monitor. This is made even more evident since Egypt and Turkey got into a war of words over the EEZ earlier this month.

Egypt to pay IOCs USD 250 mn next month after USD 300 mn payment last week: Also on the energy front, Egypt paid international oil companies USD 300 mn in arrears just last week, EGPC CEO Abed Ezz El Regal told Al Borsa on Tuesday. This would bring Egypt’s total arrears down to USD 2.1 bn. The government plans to make another USD 250 mn payment to IOCs in March, he added.

Yo, what about the little guy? Our understanding from industry players is that while the global majors are doing well on the collection front, smaller producers are seeing their receivables grow and age.

INVESTMENT WATCH- EKH expands its natural gas holdings: Egyptian Kuwait Holding (EKH) announced that it has raised its stake in NSCO Investments Limited, which owns an offshore gas field in Northern Sinai, through a subsidiary. The EKH unit paid USD 20 mn to raise its stake in NSCO to 99.99% from 40%, EKH said in a bourse filing on Tuesday (pdf).

INVESTMENT WATCH- ExxonMobil Egypt plans to invest USD 60 mn in Egypt, the head of ExxonMobil MENA’s Lubricants unit Hisham El Amroosy told Al Mal. His statements came on the sidelines of the launch ceremony of the company’s new high quality 95-octane benzene.

Egyptian stocks are set to outperform emerging-market peers as interest rates drop, Tamim Elyan and Filipe Pacheco write for Bloomberg. “Investors are likely to scour the stock market to replace returns from high-yielding deposits,” following the central bank’s move to cut rates by 100 bps. “Last week’s decision may be the first of several rate reductions as inflation slows, a cycle that will benefit companies ‘across the board,’” says our friend Mohamed Ebeid, co-chief executive officer of the investment bank at EFG Hermes.

Banks are set to maintain high profit levels through an expected pickup in fee and commission income, offsetting a gradual narrowing of interest income.

Falling rates mean lower borrowing costs for developers, Tarek Abdel Rahman, co-CEO of Palm Hills Developments, says. Abdel Rahman also expects demand for real estate to rise as returns on bank deposits drop.

Consumer stocks are also set to benefit from further cuts to rates, with Obour Land vice chairman and MD Ashraf Sherif saying “cutting the interest by one percent isn’t a game changer, but it is positive to show that the cutting trend has begun … When there is a decent fall in borrowing costs, it will help enhance our performance.”

Industrials will benefit from better refinancing options. “There are companies that are extremely leveraged and they’ll be able to get refinancing at lower levels … Companies working with heavy industries that have strong capex plans will see this is as a catalyst to start putting their growth and expansion plans into action,” Rasmala Egypt Asset Management Chairman Ahmed Abou El Saad says.

Investment and CAPEX in the food industries sector reached EGP 500 bn in 2017, head of the food industries division at the Federation of Egyptian Industries Ashraf El Gazayerli said at the Gulf Foods expo, Al Masry Al Youm reports. El Gazayerli had said earlier this week that he expects the sector to grow 8-10% this year.

Egypt’s law firms are looking to grow their M&A and IPO practices, planning expansions abroad: Managing partners at some of Egypt’s top law firms spoke to Al Borsa about their year to come. Matouk Bassiouny is currently working on as many as 30 M&A transactions in Egypt, Managing Partner Omar Bassiouny said. The firm is also advising on three IPOs in Egypt this year, he added. Matouk Bassiouny has also lined up three IPOs since expanding to Dubai and is also planning to open an office in Algeria, Bassiouny added.

Meanwhile, Zaki Hashem & Partners is currently involved in a number of high profile M&As in the oil and gas, insurance, healthcare, manufacturing and mining sector, Managing Partner Yasser Zaki Hashem said. The firm is representing China Fortune Land Development Company, which is supposed to be investing up to USD 13.5 bn on the new administrative capital (if they can ever sign those final contracts). Zaki Hashem is also advising on the Saudi-Egyptian electricity grid interconnection project.

Also up, is Tahoun Law Offices & Consultation, which is planning to partner with a UAE firm to offer advisory services to investors in Africa, said Managing Partner Nermine Mahmoud. The firm is also planning to expand its M&A advisory services with an influx of new partners, she added. The firm had advised on agreements in the construction sector worth EGP 1 bn in 2017, she noted.

Meanwhile, Andersen Tax & Legal are launching in Egypt this week through local firm Maher Milad Iskander and Co., according to Business Wire. “Egypt is considered to be one of the highest growing markets in the world and our adoption of the Andersen name in Egypt has come at the perfect time,” said Global Chairman and Andersen Tax LLC CEO Mark Vorsatz.

Did North Korea really hack OTMT? North Korea’s elite “Reaper” hacking unit has been expanding its attacks abroad over the past year, and one of its targets might have been Orascom Telecom Media and Technology Holding (OTMT), the Wall Street Journal (paywall) reports. Among the attacks that have attacked foreign companies was “a Middle Eastern company that had entered into a joint venture with the North Korean government to offer telecommunications service,” cybersecurity firm FireEye said in a report. The attack, FireEye suspects, was an attempt by the North Korean government to gather information on the company after the business relationship soured. FireEye didn’t disclose the company’s name, but it is hard not to draw a connection between the company and OTMT, which established Koryolink with the Pyongyang government back in 2008. Reports had emerged back in December that Sawiris was backing out of his investment in the Koryolink 3G network due to mounting pressure from the UN and US over his business ties there. The report noted that OTMT had halted its services there early last month. OTMT denied that it was backing out of North Korea. Reuters also has the story.

OTMT Chairman Naguib Sawiris told The Wall Street Journal he was unaware of any North Korean cyberattack last year, and doubted that one occurred. He said a Ukrainian outfit launched an attack on Orascom, but it was unsuccessful.

The Environment Ministry is preparing to launch Egypt’s first exchange for carbon credits, sources tell Al Mal for a story scant on actual fact and long on platitudes. The market for carbon credits may have softened globally, but this is worth watching, even if the proposed commodities and futures exchanges are significantly more promising.

The resumption of direct air travel between Cairo and Moscow has been pushed to April, unnamed Cairo Airport officials confirmed to the Associated Press yesterday “citing delays in booking procedures and the reopening of offices of the countries’ national airlines.” This comes as Russia’s Transport Ministry spokesman tells newswire TASS that “all the parties involved” should work to speed up the process of resuming flights now that “‘all political decisions…have been taken [and] technical aspects have been settled.’”

It’s unclear where the delay is coming from. EgyptAir Chairman Safwat Musallam announced on Monday that the airline had moved its service to Moscow to its April roster, despite having already been assigned gates in both Cairo and Moscow airports. Russian President Vladimir Putin had approved the decision back in January, after both sides signed an aviation security protocol, agreeing to relaunch the route in February.

Keeping channels open with Egypt is in Rome’s interests, Italy’s intelligence agency said in its annual report yesterday, ANSA reports. Egypt is “central in the geopolitical and regional-security dynamics and is a necessary interlocutor for [Italy] … to foster cooperation in finding those who (tortured and murdered Italian student) Giulio Regeni,” the report says. Rome had sent its ambassador back to Cairo in September, after more than a year and a half of having recalled him in the aftermath of the Regeni case. The student’s family has since criticized the ambassador’s return to Egypt.

WEEKLY CABINET ROUNDUP- The Ismail Cabinet approved yesterday a USD 5.83 mn grant from the Korea International Cooperation Agency to fund an Egyptian-Korean university in Beni Suef, according to an official statement. The ministers also signed off on a EUR 500k grant from the French Development Agency to provide technical assistance in developing public transport. Also approved yesterday was a project to develop the Egyptian National Library and Archives to protect and create a digital archive of valuable documents.

Uber has temporarily stopped operations in Morocco due to regulatory uncertainty, the company said in a statement. The company said operations would resume once appropriate legal measures were in place. Uber had been operating in Casablanca since 2015 but has legally been in the grey due to regulations that only recognize taxis operating under registered companies.

Palestinian President Mahmoud Abbas agreed to resume peace talks with Israel yesterday, “calling for an international conference to be held by mid-2018 to kick-start the stalled peace process,” Reuters reports. Abbas remained steadfast in  his refusal for US mediation, which he had previously said would be “impossible” after Washington recognized Jerusalem as Israel’s capital. The US, however, said it was “ready to talk.”


Enterprise is available without charge — just visit our English or Arabic subscription page, depending on which edition you would like to receive. We give you just about everything you need to know about Egypt, in your inbox Sunday through Thursday before 7am CLT (8am for Arabic), and all we ask for is your name, email address and where you hang your hat during business hours.

Image of the Day

The Natural History Museum’s Wildlife Photographer of the Year People’s Choice Award shows the remarkable relationship humans can develop with primates like gorillas. Jo-Anne McArthur snapped the touching moment between Pikin the rescue gorilla and her handler Appolinaire Ndohoudou.

Egypt in the News

On a slow day for Egypt in the international press, former prisoners Aya Hijazi and Mohamed Soltan argue that the US need to adopt more nuanced policies towards Egypt and the region. Writing for the Washington Post, they criticize a wave of arrests in the lead up to the 2018 presidential elections. “The United States should use its influence to address the deteriorating human-rights situation, to demand the release of all political prisoners (including presidential candidates), and to urge an opening of the political sphere… Our friendship is based not only on joint history, but on a shared conviction that only a representative democracy and the rule of law can guarantee peace and stability for Egypt and the surrounding region.”

Former presidential candidate Abdel Moneim Aboul Fotouh was put on a terrorism list yesterday following his arrest for alleged contacts with the Ikhwan, Reuters reports. The story is getting traction in foreign outlets, including The Associated Press and Voice of America.

Egyptian intelligence is pressuring Hamas to hand over Gaza to the Fatah-led Palestinian Authority, Jack Khoury writes for Haaretz. A senior Hamas delegation has been in Cairo for an unusually long time for talks with Egyptian officials, who “are very worried by the implications of the humanitarian situation in Gaza and are continuing their efforts to find a formula that would enable the reconciliation to be implemented,” a Palestinian source in Gaza said.

Also worth noting in brief this morning:

  • Netherlands-based Sudanese radio station Radio Dabanga has been taken off air by Egypt’s Nilesat since Sunday, Sudan Tribune reports.
  • Owners of blocked websites and their audiences in Egypt are developing new ways to bypass censorship, including using VPNs and proxy sites or publishing content on other platforms, the Association for Freedom of Thought and Expression says.
  • A number of economists speaking to Al Monitor have criticized the USD 3.3 bn theme park in Matrouh. They say it detracts attention from other higher priority investments, such as agriculture.
  • Authorities arrested a student in Giza for “debauchery” after allegedly organizing a concert for LGBT people, Hornet reports. The concert never took place, the website notes.
  • Enas El Masry reviews for Slate Egypt’s largest annual camel race, which has been running since 1987 in the Sinai.
  • An engineer claims the Giza Pyramids’ alignment is based on the fall equinox, according to Newsweek.
  • Medium to long-term political stability is less certain in Egypt now as Egyptians’ trust in their institutions is falling, Joseph Colonna writes for Frontera.

On Deadline

Media outlets on both sides of the globe are failing at bridging the gap between the seemingly clashing cultures of East and West, Abdel Latif El Menawy writes for Al Masry Al Youm. He argues that neither sides makes any attempt to understand the other, which has resulted in Muslims being portrayed as the new threat to the world. Trenchant insight we’ve never heard before.

Worth Watching

Ubisoft’s Assassin’s Creed Origins, which as our resident 10-year-old can tell you is set in Ancient Egypt, has launched its educational non-combat discovery mode, according to PC Gamer. The feature allows players to roam the game’s massive open world (watch, runtime 3:37) without the duress of battle, giving users the opportunity to “visualize and understand thousands of things from Egyptian history in their actual context. As both a game and a learning tool, it is quite a unique asset for teachers to integrate as part of their history classes." The game was released in October 2017 and the new module is available now for download without charge to those who have already purchased the game, the Verge reports.

Diplomacy + Foreign Trade

A Saudi delegation is expected in Cairo by early March to inspect quality control measures on Egypt’s agricultural products and discuss the possibility of lifting the kingdom’s ban on their imports, Al Mal reports. Saudi Arabia had banned imports of Egyptian strawberries and peppers over concerns of residual pesticides, prompting several other GCC countries to follow suit. The Agriculture Ministry later moved to impose stricter regulations on agricultural exports to the GCC after the successive bans. Trade and Industry Minister Tarek Kabil and Agriculture Minister Abdel Moneim El Banna had been expected to lead a delegation to KSA soon to discuss the bans, as we noted earlier this month.

Egypt is opening the Rafah border crossing with the Gaza Strip today for four days “on a humanitarian basis,” unnamed security officials tell The Associated Press. The crossing point was opened in one direction on Monday to allow stranded Palestinians through to Gaza.


ACWA Power agrees to delay its Dairut plant

Saudi Arabia’s ACWA Power has agreed to push its USD 2.2 bn, 2.25 GW Dairut power plant to the Electricity Ministry’s 2022-2027 five-year plan instead of the 2017-2022 plan, unnamed ministry sources tell Al Mal. The delay is a result of the surplus in production currently on the national grid, according to the sources. The Saudi company also agreed to establish the plant in Qena, rather than Beheira as was originally planned. ACWA had reportedly been closing in on a power purchasing agreement with the ministry for the plant earlier this month. The company’s CEO had said that some USD 14 bn in power plant project MoUs the companies have signed have been put on hold.

Swedish trade minister, ABB reps discuss potential renewable energy investments with Shaker

Swedish Trade Minister Ann Linde and representatives from engineering group ABB met yesterday with Electricity Minister Mohamed Shaker to discuss potential investments in renewable energy, Al Mal reports. The ABB officials expressed their company’s interest in cooperating with Egypt by providing the technology needed for interconnection projects. The company is among several international firm vying for contracts on the Saudi-Egypt electricity grid interconnection project.

Basic Materials + Commodities

GASC issues wheat tender while Russian wheat prices expected to rise

The General Authority for Supply Commodities (GASC) issued a tender yesterday for an unspecified amount of wheat for a late March delivery, Reuters’ Arabic service reports. Shipping for the wheat is set for the last week of March. The tender comes at a time when Russian wheat prices are expected to take a leg up on the back of increased demand coupled with shortages in high quality milling wheat, says Agri Census.

HeidelbergCement raises synergies target from Italcementi acquisition, Egypt gives bigger presence

HeidelbergCement raised its target for synergies from its USD 4 bn takeover of Italcementi for the third time in less than a year, Reuters reports. “Italcementi gave HeidelbergCement a bigger presence in several markets, including Egypt, where it saw significant savings ‘due to the realization of synergies and the adjustment of the fuel-mix due to the commissioning of a new coal mill.’” HeidelbergCement now expects cost savings from the acquisition to reach EUR 550 mn by 2018’s end.

Real Estate + Housing

Naguib Sawiris invested in real estate projects through Gemini Holding

Naguib Sawiris discussed investing in real estate projects in new urban communities through his family’s private equity firm, Gemini Holding, with Housing Minister Mostafa Madbouly yesterday, Al Borsa reports. Madbouly said that the ministry is gearing up for tendering the third round of private-public partnership projects, with the available land reaching 10k feddans.

ERC to launch three new projects in Sahl Hasheesh within two years

The Egyptian Resorts Company (ERC) is planning to launch three new projects in Sahl Hasheesh within the next two years, CEO Wael Hatow tells Youm7. Two of these projects, which will include apartment complexes, will be launched this year, while the third remains under study and is expected to be launched in 2019. The investment values of the projects were not disclosed.

NUCA revokes Bin Laden Group subsidiary’s construction license for North Coast hotel

The New Urban Communities Authority (NUCA) revoked the construction license granted to a Bin Laden Group subsidiary to establish a North Coast hotel after the company failed to begin work on the project during the allotted time, authority official Hatem Mahmoud tells Al Borsa. According to Mahmoud, the 2015 tender for the hotel land plot had required the developer to complete the project within two years. The authority will now either withdraw the land or re-issue a tender for the hotel.

Wadi Degla re-launches The District outdoor mall

Wadi Degla City for Urban Development re-launched its outdoor mall, The District, on Monday “as an outdoor family hub,” according to an emailed statement (pdf). The mall, which spans 200k sqm in the Sheraton area, includes a sporting club, gym, hypermarket, restaurants and food outlets, as well as clothing stores.


26th Dynasty temple unearthed in Kafr El Sheikh

The remains of a 26th dynasty temple were unearthed in Kafr El Sheikh Talal Al Faraeen archaeological site, Al Masry Al Youm reports. The discovery sheds light on King Psamtik I and his fight against the Assyrian invasion, site manager Gamal Salem said.

Automotive + Transportation

Customs Authority holds shipment of Jinpei cars, refusing to ratify Bavaria Auto’s import bill

The Customs Authority is reportedly holding a shipment of Chinese Jinpei cars and is refusing to ratify the import bill presented by Brilliance Bavarian Auto, the distributor, Al Mal reports. The authority is imposing a 13% markup on the price listed on the import bill, despite the dealership presenting official documents showing that Jinpei is offering discounts on the vehicles, according to Brilliance Bavarian’s deputy general manager Khaled Saad.

Banking + Finance

CIB to contribute USD 200 mn to USD 550 mn loan to EGPC

CIB will contribute USD 200 mn to a two-year USD 550 mn loan to the Egyptian General Petroleum Company (EGPC), sources tell Al Mal. The National Bank of Egypt (NBE) and Banque Misr will each contribute USD 150 mn, while Banque du Caire will pay the remaining USD 50 mn under an agreement signed last week.

Other Business News of Note

Export councils to lobby House for raising export subsidies to EGP 5-6 bn

Export councils are planning to submit a request to the House of Representatives asking that they lobby the government to raise the allocated amount to export subsidies in the state budget to around EGP 5-6 bn from a current EGP 2.6 bn, Chemical and Fertilizers Export Council Chairman Khaled Abul Makarem, tells Al Borsa.

Egypt Politics + Economics

Court jails 20 Kerdasa church arsonists for 10 years

The Cairo criminal court sentenced 20 people to 10-year prison terms after finding them guilty for setting Kerdasa’s Virgin Mary church ablaze in August 2014, Al Shorouk reports. Two minors also received three-year sentences.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.64 | Sell 17.74
Buy 17.59 | Sell 17.69
EGP / USD at NBE: Buy 17.6 | Sell 17.7

EGX30 (Tuesday): 15,219 (+0.4%)
Turnover: EGP 1.2 bn (6% ABOVE the 90-day average)
EGX 30 year-to-date: +1.3%

THE MARKET ON TUESDAY: The EGX30 ended Tuesday’s session up 0.4%. CIB, the index heaviest constituent closed up 0.7%. EGX30’s top performing constituents were Abu Qir Fertilizers up 5.2%; Eastern Co up 2.1%; and Abu Dhabi Islamic Bank up 1.7%. Today’s worst performing stocks were Porto Group down 3.0%; Ezz Steel down 2.5%; and SODIC down 2.4%. The market turnover was EGP 1.2 bn, and local investors were the sole net sellers.

Foreigners: Net Long | EGP +66.5 mn
Regional: Net Long | EGP +79.8 mn
Domestic: Net Short | EGP -146.3 mn

Retail: 55.1% of total trades | 53.0% of buyers | 57.3% of sellers
Institutions: 44.9% of total trades | 47.0% of buyers | 42.7% of sellers

Foreign: 25.0% of total | 27.7% of buyers | 22.3% of sellers
Regional: 13.3% of total | 16.6% of buyers | 10.0% of sellers
Domestic: 61.7% of total | 55.7% of buyers | 67.7% of sellers

WTI: USD 61.9 (+0.36%)
Brent: USD 65.08 (-0.9%)

Natural Gas (Nymex, futures prices) USD 2.63 MMBtu, (+2.81%, MAR 2018 contract)
Gold: USD 1,332.7 / troy ounce (-1.73%)

TASI: 7,506.09 (-0.29%) (YTD: +3.87%)
ADX: 4,577.79 (-0.04%) (YTD: +4.08%)
DFM: 3,270.34 (-0.84%) (YTD: -2.96%)
KSE Weighted Index: 408.00 (-0.03%) (YTD: +1.64%)
QE: 9,098.64 (-0.09%) (YTD: +6.75%)
MSM: 5,000.48 (-0.14%) (YTD: -1.94%)
BB: 1,344.57 (+0.89%) (YTD: +0.97%)

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

20 February (Tuesday): The Third Annual Capital Markets Summit, InterContinental Cairo Semiramis, Cairo.

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.

07-11 March (Wednesday-Sunday): ITB Berlin Convention, Berlin, Germany.

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).

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