Sunday, 5 August 2018

Another step closer to deregulating natgas

TL;DR

What We’re Tracking Today

The World Bank and International Monetary Fund’s African Caucus meetings for 2018 start today in Sharm El Sheikh, according to an Investment Ministry statement. The meetings, which run through tomorrow, are hosted by the central bank and the ministries of investment and finance and will be chaired by ministers Sahar Nasr and Mohamed Maait. A number of high-ranking IMF and World Bank officials are expected to be in attendance, as are representatives of African finance institutions. Nasr assumed the chairmanship of the World Bank’s 2018 African Caucus last year.

Foreign Minister Sameh Shoukry is meeting his Italian counterpart Enzo Moavero Milanesi in Cairo today for “political consultations,” a ministry source tells Ahram Online. Milanesi’s visit to Egypt is set to last three days, during which he will also meet President Abdel Fattah El Sisi.

Is Cleopatra Hospitals about to get a new owner? Abraaj veteran Ahmed Badreldin is leading a group of staff from the embattled private equity firm in a bid to spin off its USD 375 mn North Africa fund, according to the Wall Street Journal, citing a document seen by its reporters. The proposal to the Dubai-based firm’s liquidators asks that they consider an “amicable separation” of the fund from the rest of the firm. “The fund’s roster of investors would remain in place and an advisory firm would be appointed to supervise the new setup as a ‘guardian,’” the Journal writes. The bid comes as both hedge fund York Capital Management and the investment firm Abu Dhabi Financial Group are reportedly bidding for Abraaj’s fund-management unit. Limited partners in Abraaj’s North Africa fund include “the European Investment Bank and a unit of the World Bank Group,” the newspaper says. EGX-listed Cleopatra Hospitals is one of the North African fund’s most high-profile holdings.

Egypt and Kazakhstan are better options than Turkey for emerging market investors, in no small part because Ankara could be on the brink of a “spiral,” Nordea Asset Management tells Bloomberg. With the TRY dropping about 25% against the USD this year and bond yields hitting a new record, Turkey makes for a “prime example of an erosion of governance.”

Turkey’s most recent implosion? The US imposed sanctions on Turkey’s justice and interior ministers last Wednesday in an attempt to get Turkey to turn over an American pastor accused of backing a coup attempt against President Recep Tayyip Erdogan two years ago, Reuters reports. Turkey apparently responded in kind, freezing any assets of the US justice and interior departments in Turkey. Now in a desperate plea, Erdogan is urging foreign currency holders to turn their cash into liras to stymie the slide in the currency, according to Bloomberg.

Meanwhile: After giving NATO allies slaps across the cheek the Trump administration is pushing Arab countries to create a NATO of their own. Bloomberg’s editorial board, however, sees nothing good coming from the push to create a collective defense pact. Instead, they encourage the Trump administration to simply work on resolving current disputes between Arab states, including the Qatar smackdown.

WHAT? The public sector gets to work only four days a week? Prime Minister Mostafa Madbouly has reportedly authorized the Central Authority For Organization & Administration (CAOA) to begin studying the possibility of shortening the work week for state bureaucrats to four days, according to documents obtained by El Watan. The order established a committee headed by the CAOA chief Saleh Abdel Rahman and will include representatives of the Planning Ministry and academics and researchers to study the proposal. The stated purpose of the move was to cut costs and reduce congestion and traffic around government agencies. Madbouly’s proposal does not include a wage cut, so any savings would come from cutting operations.

Part of public sector reform drive: President Abdel Fattah El Sisi ordered the Finance Ministry last month to begin reassessing public sector wages as part of the government’s administrative reform drive. Cutting government spending is a crucial policy platform of the Finance Ministry going forward, said Finance Minister Mohamed Maait.

Food for thought #1: Wouldn’t it also make sense to speed along the retirement of public servants to cut our unreasonably high population of bureaucrats?

Food for thought #2: As radical as it may be, four day work week could be something worth considering — for the private sector. New Zealand firm Perpetual Guardian, which implemented a four day work week (with pay maintained at a five-day work week), is claiming spectacular results. Academics studying the trial say 78% of employees feel they were able to successfully manage their work-life balance, cutting stress levels and boosting commitment, according to the Guardian.

Bernie Sanders gives props to Benban: US Senator and former Democratic Party presidential nominee contender Bernie Sanders shared an LA Times story on the Benban solar park last week. “While Trump is ending America’s commitment to combating climate change, Egypt is building the world’s largest solar farm in the middle of the desert,” Sanders said in a Facebook post. “This is the kind of revolutionary technology we should be taking advantage of to grow our economy and sustain our planet for future generations.”

Apple became on Thursday the world’s first company to be valued at USD 1 tn, Bloomberg reports. The company’s shares closed the day at USD 207.39, pushing its market cap up to USD 1.002 tn. “Other tech giants are not far behind Apple today, with Amazon.com Inc., Alphabet Inc. and Microsoft Corp. worth more than USD 800 bn each,” the business information service reports.

Mo Salah fans have until tomorrow to make him one of FIFA’s top three men’s footballers for 2018. Cast your ballots here.

Enterprise+: Last Night’s Talk Shows

On a lackluster evening on the airwaves, the aforementioned proposal to reduce the number of working days for some civil servants seemed to garner the most attention (of course it would).

The Central Agency for Organisation and Administration (CAOA) will complete assessment of the proposal in around five weeks, CAOA head Saleh El Sheikh tells Amr Khalil, who is filling in for Eman El Hosary on Masaa DMC. (watch, runtime: 16:11). El Sheikh and El Watan journalist Maher Hendawi appear very much in favor of the move, with both saying that it would increase productivity and efficiency. Hendawi even says it cut back the state bureaucracy, which is generally overstaffed and underperforming (watch, runtime: 4:44). We repeat: these arguments also point in favor of speeding retirees along or making it easier to fire underperforming workers.

Rassd reporter Salwa Hussein defended her controversial interview with a group of teenagers detained for smuggling goods in Ismailia on Masaa DMC. Hussein had stirred controversy on social media for berating the minors for resorting to illegal work rather than making “an honest living” with a cleaning company for EGP 50 per day. Hussein maintained her interview was within bounds since security personnel and officials from the Social Solidarity Ministry were present and did not object to her line of questioning (watch, runtime: 6:12 and runtime: 6:17).

Naguib Sawiris himself has since offered to provide legal counsel to and hire the teenagers, Ahram Online reports.

Egypt recently hosted engineers from several Nile Basin countries to share their respective country’s expertise with regards to specific projects or industries in a bid to bolster Egypt’s ties with these countries, Irrigation Ministry Spokesman Hossam El Imam told Al Hayah fi Masr’s Kamal Mady (watch, runtime: 7:48).

Hona Al Asema interviewed residents of Sinai’s Bir El Abd, where life is regaining a sense of normalcy as the peninsula’s militant insurgency is being rooted out (watch, runtime: 5:20).

The role of the youth in politics was the main focus of a discussion hosted by Masaa DMC’s Amr Khalil with several young politicians working to expand their presence and open up Egypt’s political scene for youth participation (watch, runtime: 3:17).

Speed Round

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Natgas market regulator sets fees for private sector’s use of the state grid at USD 0.38 / MMBtu: The Natural Gas Regulatory Authority set on Thursday the fee that private sector players will have to pay to use the state’s national grid to transport gas at USD 0.38 / MMBtu, according to its official website. The rate applies for the first year of the program, suggesting a revision could be in the works after the initial trial period. License fees will be calculated based on the amount of gas transferred and can be settled in EGP. The regulator will be issuing permits for different types of commercial gas market activities, including grid operations and maintenance, supply, distribution, and shipping, with different fees set for each type as follows:

  • USD 0.057/MMBtu for transmission licenses;
  • USD 0.031/MMBtu for shipping licenses;
  • USD 0.023/MMBtu for distribution licenses;
  • USD 0.008/MMBtu for supply licenses.

Permit requests must be processed within 10 working days of application and any additional documents required by the regulator must also be submitted within 10 working days. The regulator will then have 45 days to approve or deny the request and fees must be deposited within seven days of that date.

Background: The Oil Ministry had said last month that the regulator was given the green light to begin issuing and revoking licenses for private players in the natural gas industry, a move that was made possible by the deregulation of the sector through the Natural Gas Act.

No word yet on import licenses: There’s no word yet on when the first import license will be issued, but sources had previously said to expect the first before the end of 2018.We had heard last year that EGAS gave BB Energy, Fleet Energy, and Qalaa Holdings’ TAQA Arabia preliminary approval on natural gas import licenses, which still need to be ratified by the new regulator. Alaa Arafa’s Dolphinus Holdings, which signed a USD 15 bn natural gas import agreement with Israel earlier this year, is also expected to be among the first to receive an import permit.

EXCLUSIVE- FinMin won’t consider FX bond issuance until fall: The Finance Ministry will not begin considering a foreign currency-denominated bond issuance for another two months, Finance Minister Mohamed Maait told Enterprise. The ministry will begin deliberations then on whether to hold a bond issuance or hold off on the decision and seek other alternative financing, he added. Market conditions at the time will be an important factor in the decision, he suggested.

Thank the EM zombie apocalypse: Maait attributed the move to the turbulent market conditions facing emerging markets lately, including rising US interest rates and the trade war between the US and China. He noted, however, that while portfolio outflows resulting from the EM selloff reached USD 3-4 bn, Egypt is doing much better than its other EM counterparts, thanks largely to the economic reform program and the CBE’s monetary and FX policies.

These “challenging market conditions” had been the primary motive behind Egypt’s tweaking of its funding mix by relying on longer-term facilities from international finance institutions. Maait had told us last month that the ministry is looking for tenors of up to 30 years with interest rates of 1-2%.

NI Capital to manage another stake sale of the privatization program: The Holding Company For Maritime & Land Transport has tapped state-owned NI Capital to manage the sale of 30% of subsidiary Alexandria Container and Cargo Handling (ACCH) as part of the state’s privatization program, according to a company statement. ACCH is expected to sell the additional shares on the EGX in November, according to previous statements by Public Enterprises Minister Hisham Tawfik. This is the second share sale of the program to be managed by NI Capital after Heliopolis for Housing and Development (HHD) chose it to manage its 32.25% share sale in October.

Where does this leave private sector advisers? Past announcements by the government had heavily implied that private sector investment banks would take part in the state privatization program. Yet as the short deadline to sell shares approaches, it appears that NI Capital will have a larger role than initially anticipated out of convenience, despite reports of private sector offers. On the other side of the equation, Chemical Industries Holding Company (CIHC) Chairman Emad El Din Mostafa had said that NI Capital was organizing a limited tender for private sector banks to manage the share sales in Eastern Company and Abu Qir Fertilizers, which take place soon. It is still unknown who the government has in mind to advise on the sale of shares in Alexandria Mineral Oils Company (AMOC), the fifth company piloting the program.

IPO WATCH- Giza Spinning and Weaving to float up to 40% of shares in November IPO: Privately-owned Giza Spinning & Weaving Company is planning to float as much as 40% of its shares on the EGX in an initial public offering in November, Co-CEO Fadel Marzouk told Bloomberg in an interview. The company is set to start an international roadshow for the offering in October, visiting “the US, Europe, South Africa, and Gulf countries.” Proceeds from the garment exporter’s IPO will be used to finance a EGP 250 mn project to expand its yarn and garment production capacities as “the momentum is there and exports are rising year on year, so it’s the right time to expand and grow our business and get investors into the company,” said Marzouk. Beltone Financial will serve as global coordinator and bookrunner.

Cairo Development and Investment minority shareholders have until 8 August to sell their stakes at EGP 4.20/share: Minority shareholders in Cairo Development and Investment will be able to sell their stakes at EGP 4.20 / share until 8 August, before the company completes its voluntary delisting from the EGX, the bourse said in a statement carried by Al Mal. Minority shareholders had objected to the board’s decision to delist from the EGX.

M&A WATCH- Mondi completes Suez Bags acquisition. The EGX announced on Thursday that Mondi Paper Sales completed its acquisition of Suez Bags, having bought 7.23 mn shares at EGP 26.01 per share in a EGP 188.1 mn transaction, Al Mal reports, citing a bourse statement. The offer price valued the company as EGP 284 mn. The Financial Regulatory Authority had signed off in June on Mondi’s mandatory tender offer to acquire 70.1% of Suez Bags (or 7,666,435 shares). EFG Hermes was sell-side advisor for Suez Cement Co. and Tourah Portland Cement Co., the primary selling shareholders, with Zulficar & Partners acting as legal advisor to the sellers. Pharos had been tapped to act as the broker for the MTO while Zaki Hashem & Partners acted as Mondi’s local counsel.

REGULATION WATCH- Shorts are coming: FRA committee completes draft of short-selling regs ahead 3Q2018 introduction: The Financial Regulatory Authority’s (FRA) Capital Markets Committee completed on Thursday its draft of the final framework and rules that will govern short-selling, sources close to the matter tell Al Mal. Short selling will make its debut on the EGX in 3Q2018, the story suggests. Under new regulations, clients looking to short a share — or borrow shares from their brokers for a small fee then sell it right away, hoping that its price will drop before buying it back, returning it to the broker and pocketing the difference — will be forced to pay a cash security deposit equivalent to 50% of the value of their borrowed stocks, according to the sources. Brokerages will also be allowed to jump in and close out shorts, repurchase the stocks on behalf of clients if a share rises by 15%. The regs will also allow brokers to re-invest clients’ deposits in any high-yielding investment with guaranteed annual returns.

Background: The FRA’s board had approved in May amendments to the Capital Market’s Act’s executive regulations that govern short-selling, which included provisions that allow brokerage and securities firms to offer the service. FRA deputy head Khaled El Nashar had said last month, however, that he expects “very few brokerages” to win licenses to short, as the authority is planning to restrict the activity to firms that meet certain conditions, such as a strong balance sheet position. Limits will also be placed on number of shares a short seller can borrow for a short position, El Nashar had said. Short selling was introduced to the market through the amended Capital Markets Act, which also opens the door to the issuance of sukuk and commodities and futures exchanges. We’re also expecting short-term bonds to be on the investment menu soon.

On a related note, the FRA is hosting a workshop on capital market governance in Cairo today with representative from US counterpart institutions in attendance, according to Al Shorouk. The workshop — which will focus discussions on capital market oversight and regulation, as well as crimes in the digital age — will host officials from the US Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), Financial Services Volunteer Corps (FSVC), and Bloomberg.

Egypt’s net foreign currency reserves rose to USD 44.31 bn at the end of July 2018, up from USD 44.26 bn at the end of June, the central bank announced on Thursday.

Egypt purchases wheat at record-high prices of over USD 250 a tonne in Thursday tender: The General Authority for Supply Commodities (GASC) purchased 240k tonnes of Russian and Romanian wheat in an international tender on Wednesday at record high prices of over USD 250 a tonne, traders tell Reuters. The steeper offers came from Russia’s GTCS and Romania’s Ameropa for 60,000 tonnes each at USD 254.46 and USD 253.56 a tonne, respectively, including shipping costs. GASC also purchased 60,000 tonnes each from Russia’s Posco Daewoo at USD 253.25 a tonne, and Russia’s Aston at USD 251.96 a tonne. The wheat is scheduled for 11-20 September delivery.

Wheat prices spiked last week to a three-year high before dropping again, after Ukraine hinted at the possibility of setting export limits as a way of mitigating the impact of a drought in Europe and the Black Sea region, Bloomberg said. Egypt had made its most expensive wheat purchase since 2015 late last month, paying an average USD 235.65 per tonne. Wheat prices are expected to climb even higher as Russian production falls for the first time in six years and as crops in France, Germany and the Baltic countries also get smaller. Egypt also faces the risk of attracting fewer offers for its tenders Dutch lender ING Groep reportedly decided to halt lending for wheat shipments sold to GASC, citing late payments as the reason.

El Sisi, Chinese builder to ink contracts in September for development of new capital’s second phase: President Abdel Fattah El Sisi will sign in September contracts for the construction of the second phase of the new administrative capital with China State Construction Engineering Company (CSCEC), Prime Minister Mostafa Madbouly said, Al Masry Al Youm reports. According to Madbouly, El Sisi will ink the agreement with CSEC during a trip to Beijing next month to attend the Forum on China-Africa Cooperation. Madbouly did not disclose the expected investment value or timeline for the development of the second phase. CSEC is expected to complete the USD 3 bn first phase of the district, which it signed for last October, within two years.

New capital airport to be larger than Cairo Int’l? El Sisi ordered that the new administrative capital’s airport to be larger than Cairo International Airport, said Civil Aviation Minister Younes El Masry on Thursday, according to Youm7. The airport will be located east of the new capital, a location selected due to its proximity to the Suez Canal Economic Zone ports, the head of the New Administrative Capital Company for Urban Development Zaki Abdin tells the newspaper.

Over 60% of Japanese companies operating in Egypt are expecting improvements in their profits in 2018, according to a survey conducted by the Japan External Trade Organization (JETRO). Businesses said improvements would be led by increases in local market sales. Companies operating in Egypt are expected to lead the region in terms of profit growth for the year, followed by those in Kenya, Ghana, Morocco, Mozambique, South Africa, and Nigeria. The country also scored high on indexes for market growth potential and political and social stability. You can view the full report here (pdf).

MOVES- Prime Minister Mostafa Madbouly named Planning Minister Hala El Said as Egypt’s representative on the Islamic Development Bank’s governing council, Youm7 reports. Madbouly also tapped Finance Minister Mohamed Maait as El Said’s alternate governor.

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Up Next

Foreign Minister Sameh Shoukry should be landing in Washington this week to meet with US Secretary of State Mike Pompeo over developments in the Middle East and US-Egypt relations.

The Federation of Egyptian Industries is expected to present its remarks on the new draft of the Customs Act this weekto the Finance Ministry. The FEI’s tax committee had laid out its recommendations and reservations on the act last week, citing concerns including whether the law is compliant with the Investment Act, clearly defining production inputs, and making sure that penalties under the act are not extreme.

The CBE will be hosting the annual meeting of the Association of African Central Banks in Sharm El Sheikh from 5 to 9 August.

The central bank will next consider interest rates on Thursday, 16 August.

Orange Egypt’s board of directors is meeting on 27 August to look into the company’s proposal for a voluntary delisting, according to a statement to the EGX (pdf). The mobile network operator has been facing mandatory delisting for several months for failing to meet the EGX’s requirements on the minimum required number of shares in freefloat. The company appears to have concluded that it cannot meet the requirement and will delist of its own accord.

A delegation of 60 unnamed US companies is set to visit Egypt in October to explore potential investments across a variety of sectors. A Japanese trade delegation is also due to visit the new capital and Suez Canal by the end 2018.

Egypt in the News

It was a very slow news weekend for Egypt in the foreign press with no particular story gaining momentum.

The BBC is running a stunning photo gallery of the 220km Sinai trail. We know we’ve picked up images of this before, but we can’t get past how awesome it really is. Definitely on the bucket list for some of us here — though certainly not in this heat. This comes as ABC Australia has a piece out on Saturday charting Egypt’s tourism recovery.

Other headlines worth a look this morning:

  • The CBE has partnered with Kodak Alaris to digitize 500 mn documents over the next five years, according to Global Banking & Finance Review
  • Former Egypt national football team coach Hector Cuper has been hired to manage Uzbekistan’s team, Reuters says.
  • Rana Allam questions whether the resumption of military aid to Egypt is in the US’ best interest in a piece for Lobe Log.

On Deadline

Why did the new government turn its back on Tarek Kabil’s Automotive Directive? The government’s decision to scrap — or at least significantly modify — the Automotive Directive drafted and promoted by former Trade and Industry Minister Tarek Kabil has Al Masry Al Youm’s Hany Labib scratching his head. Labib takes note of our exclusive report from last week that the government is looking to replace the Automotive Directive with a policy of setting up special auto freezones offering tax and customs breaks to assemblers. He wonders aloud why current Minister Amr Nassar decided to draft his own policy from scratch — and why some incoming ministers feel that their success rides on erasing their predecessors’ legacy.

Worth Reading

Why small-time perfumeries are making it big: Independent perfume makers in the US accounted for some 6% of the country’s USD 4 bn industry last year, selling just as well, if not far better, than many high-end brands, according to Bloomberg, and it’s not because they’re cheaper. “A mass-market luxury perfume might use high-end ingredients, but it’s designed to be generic enough to appeal to consumers at airport kiosks in Beijing, department stores in New York, and boutiques in London,” says Patrice Revillard, who founded the boutique perfumery Maelstrom in Paris with partners Marie Schnirer and Yohan Cervi. The three friends were selected in a competition to recreate a 1940s cult scent known as Iris Gris, which in its new form, L’Iris de Fath, would set you back around EUR 1,470 for a 1 ounce bottle. While not every scent they make is as pricey, Maelstrom was chosen due to their “quality, artistry, ingredients, and [ability to create] these really rich experiential fragrances.”

Higher-end brands took a leaf out of these small perfume makers’ playbook and began launching their own “rare” and “special” blends and scents. “To the surprise of big brands…these rarefied perfumes started to make money. As a result, they also began to acquire independent makers of smaller-batch specialty perfumes.” Estee Lauder acquired “niche perfumers Editions de Parfums Frédéric Malle and Le Labo” in 2014; Dolce & Gabbana first launched it’s higher-end Velvet Collection in 2011 selling a 5 ounce bottle at USD 430. “It’s simple to add a formula together, but then you have to balance everything,” says Revillard.

Diplomacy + Foreign Trade

Senior Hamas officials are debating whether to accept an Egypt and UN-proposed ceasefire with Israel, according to Bloomberg. Senior leaders from Hamas returned to Gaza on Thursday to discuss with other local leaders the proposed plan, which involves a prisoner swap and the construction of seaports, one each in Ismailia and Sinai as part of a plan to rehabilitate the area, Israeli media reports. On a related note, Egypt announced the opening of the Rafah border crossing with Gaza for four days as of Saturday to allow pilgrims through to Saudi Arabia for Hajj.

Energy

Gas production at Egypt’s 9B field to begin in October

Shell is due to begin production from its two deepwater wells at the West Nile Delta field 9B in the first half of October, Oil Minister Tarek El Molla said, according to an Oil Ministry statement. The entire project is set to come online by 2H2019, producing up to 400 mcfd. Shell said in May it was planning to begin pumping 100 mcfd from the project in 3Q2018. The first phase of the project will include linking two out of the total eight wells to the national grid in 3Q and 4Q2018, followed by a third well in 1Q2019. Phase two will see the remaining five wells linked to the national grid in 3Q-4Q2019. Separately, El Molla met with Halliburton’s President of Eastern Hemisphere Joe Rainey to discuss cooperation in setting up an electronic platform for marketing available concessions for oil and gas exploration and production, under two agreements signed back in April.

Electricity Ministry moves ahead with plans to link Egypt-Sudan electricity grids

The Electricity Ministry appears to be moving ahead with plans to link our national grid with Sudan’s, according to Al Masry Al Youm. The first phase of the USD 60-70 mn project will involve the construction of antenna lines for total investments of USD 6.7 mn, ministry spokesperson Ayman Hamza tells the newspaper. The lines will run for 100 KM, from Toshka in Egypt to Wadi Halfa in Northern Sudan, and take three months to complete. A delegation from India’s Larsen & Toubro, which won the tender for the project, visited the site last week to begin laying the groundwork, Hamza added. Sources had said last month that the first phase of the project, which should see Egypt and Sudan exchange some 300 MW of power, would be operational by December of this year.

Basic Materials + Commodities

Egypt receives USD 48.3 mn from Sukari gold mine in 1H2018

Egypt has received USD 48.3 mn in profit share and royalties from Centamin’s Sukari gold mine in 1H2018. The Egyptian Mineral Resources Authority (EMRA) received USD 39.3 mn in profit share from the mine, with Centamin paying USD 9.0 mn in royalties to the state, Centamin said in its earnings release (pdf). This came as the company reported a 2% y-o-y increase in its top line for the six-month period to USD 296.4 mn, despite a 7% y-o-y drop in overall production from the mine to 217.1k ounces. The company expects production to ramp up in the second half of the year, driven by continued improvements in mining operations.

Sugar farmers want to grow stevia as alternative to more water-intensive crops

Local farmers are calling for permission to grow stevia as an alternative source of sugar to replace water-intensive crops such as sugarcane and beets, according to Al Masry Al Youm. A feddan of stevia can reportedly produce as much sugar as 18 feddans sugar cane. Egypt has been clamping down on cultivation of unsustainable agricultural practices with an eye towards water conservation, soil preservation, economic viability.

Tourism

Recovering tourism in Egypt, Tunisia, Turkey push Spanish hotels to cut prices

Recovering tourism markets in Egypt, Tunisia, and Turkey are pushing Spanish hotels to cut prices on summer holiday packages, Reuters reports. The three resurgent markets are competing with Spain mostly for German and British tourists, the newswire notes. As we noted previously, Spanish coastal cities in particular are taking a hit from the lower prices of flights and accommodation in Egypt, Tunisia, and Turkey.

Banking + Finance

Abu Qir Fertilizers vetting three offers for EGP 600 mn loan for nitric acid project

Abu Qir Fertilizers is vetting offers from three banking consortiums for a EGP 600 mn loan needed for its nitric acid project, company sources tell Al Mal. The company received offers from consortiums led by the National Bank of Egypt (NBE) and Kuwait National Bank, according to the sources, who refused to name the third group. Abu Qir Fertilizers’ board of directors had agreed in May to mandate a consortium made up of the NBE, Qatar National Bank, and Banque Misr to manage a EUR 105 mn loan for its EUR 133.6 mn project.

Acumen to launch two funds worth EGP 200 mn soon

Acumen Asset Management plans to establish two new funds in the coming period with collective capital of EGP 200 mn, Product Development head May El Haggar tells Al Mal. The first will be a EGP 100 mn cash fund and the second a EGP 100 mn capital guarantee fund, according to El Haggar. He said that talks were ongoing with an insurance and investment company over a potential partnerships to launch the funds, but did not name the companies.

Other Business News of Note

Furniture City in talks with Egyptian, UAE investors to establish EGP 1.5 bn in projects

Officials from the Damietta Furniture City are in talks with unnamed Egyptian and Emirati investors to establish projects worth EGP 1.5 bn, CEO Moataz Bahaa El Din said, according to Al Mal. The projects include building conference halls, a hospital, a hotel and a technical institute for design and vocational training.

El Assar meets with Bechtel regional president to discuss cooperation

Military Production Minister Mohamed El Assar met yesterday with Bechtel’s Regional President for Europe and the Middle East, Stuart Jones, to discuss a potential JV with ministry-affiliated companies, Al Shorouk reports. The JV would be established specifically for development on national mega projects, according to the newspaper.

Legislation + Policy

House Rep. drafts legislation regulating organ donations

The House of Representatives is drafting legislation to regulate organ donations, which will be up for discussion during its upcoming legislative session, Rep. Tarek Metwalli tells Al Shorouk.

Law

Shalakany Law tapped as legal advisor for EGPC reorganization

Shalakany Law Office has been selected as legal advisor on the reorganization of the EGPC and its subsidiaries, El Shalakany Partner Mariam Fahmy tells Amwal Al Ghad. The operational restructuring process, which is hoped would boost production and efficiency, is expected to be complete by end-2018, Fahmy says.

Egypt Politics + Economics

Muslim Brotherhood-era minister Mohamed Mahsoub released in Italy

Italian authorities in Sicily released on Thursday Ikhwan-era Parliamentary Affairs Minister Mohamed Mahsoub after detaining him for 12 hours, Egypt’s Foreign Ministry said in a statement picked up by the Associated Press. Mahsoub, who has been an Italian citizen since 2016, is wanted on charges of fraud. Italian authorities said they would continue to monitor the former minister. Mahsoub released a video claiming “all the accusations are fabricated.”

On Your Way Out

Pope Tawadros quits Facebook: Pope Tawadros has shut down his Facebook page, saying he has quit the site as it’s a "waste of time," Sky News reports. The Coptic Orthodox Church also ordered its monks to shut down their social media accounts, giving them a one-month deadline to do so, saying that social media posts “are not true to monastic life". The church also announced on Thursday that it would stop accepting new monks into its order for the next year, until after the murder of Bishop Epiphanius is resolved, the Associated Press reports. The bishop was found dead inside a monastery in Behera last week and church officials had ruled out terrorism.

Authorities crack down on counterfeit zebras: A zookeeper has been called in for questioning by authorities over the donkey painted to look like a zebra presented at his zoo. The story, which is gaining traction in the foreign press, has been a new source of embarrassing entertainment to satirists, with the Daily Show’s Trevor Noah poking fun at the situation (watch, runtime: 1:35).

A Czech tourist was killed in a shark attack off the coast of Marsa Alam, Egyptian Streets reports. Local police are investigating the incident.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.82 | Sell 17.92
EGP / USD at CIB:
Buy 17.83 | Sell 17.93
EGP / USD at NBE: Buy 17.78 | Sell 17.88

EGX30 (Thursday): 15,806 (+0.9%)
Turnover: EGP 1.5 bn (66% above the 90-day average)
EGX 30 year-to-date: +5.2%

THE MARKET ON THURSDAY: The EGX30 ended Thursday’s session up 0.9%. CIB, the index heaviest constituent ended up 2.2%. EGX30’s top performing constituents were Qalaa Holdings up 2.8%, Elsewedy Electric up 2.4%, and CIB up 2.2%. Thursday’s worst performing stocks were Palm Hills down 6.8%, Egyptian Iron & Steel down 2.1%, and Orascom Telecom Media & Technology down 1.5%. The market turnover was EGP 1.5 bn, and foreign investors were the sole net buyers.

Foreigners: Net Long | EGP +230.0 mn
Regional: Net Short | EGP -17.4 mn
Domestic: Net Short | EGP -212.6 mn

Retail: 47.7% of total trades | 46.0% of buyers | 49.4% of sellers
Institutions: 52.3% of total trades | 54.0% of buyers | 50.6% of sellers

Foreign: 23.0% of total | 35.6% of buyers | 10.4% of sellers
Regional: 7.2% of total | 6.3% of buyers | 8.2% of sellers
Domestic: 69.8% of total | 58.1% of buyers | 81.4% of sellers

WTI: USD 68.49 (-0.68%)
Brent: USD 73.21 (-0.33%)

Natural Gas (Nymex, futures prices) USD 2.85 MMBtu, (+1.31%, September 2018 contract)
Gold: USD 1,223.20 / troy ounce (+0.25%)

TASI: 8,253.54 (-0.43%) (YTD: +14.21%)
ADX: 4,811.42 (-0.70%) (YTD: +9.39%)
DFM: 2,973.94 (-0.15%) (YTD: -11.75%)
KSE Premier Market: 5,349.33 (+0.73%)
QE: 9,981.22 (+0.05%) (YTD: +17.10%)
MSM: 4,326.67 (-0.32%) (YTD: -15.15%)
BB: 1,349.17 (-0.32%) (YTD: +1.31%)

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Calendar

05-09 August (Sunday-Thursday): CBE hosts 41st annual meeting of the Association of African central banks, Sharm El Sheikh, Egypt.

16 August (Thursday): CBE’s Monetary Policy Committee meeting.

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

28-29 August (Tuesday-Wednesday): CI Capital’s 5th Annual Egypt Equities Conference, Cape Town, South Africa.

04-05 September (Tuesday-Wednesday): Euromoney Egypt Conference 2018, Cairo.

10-13 September (Monday-Thursday): EFG Hermes’ 8th Annual London Conference, Emirates Arsenal Stadium, London.

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

18 September (Tuesday): Cairo Economic Court to issue ruling on EGP 5.6 bn antitrust case against pharma companies including Ibnsina.

20-23 September (Thursday-Sunday): 2018 Automech Formula car expo, Cairo International Convention Center, Nasr City, Cairo.

22 September (Saturday): New academic year begins for public schools, universities.

24-25 September (Monday-Tuesday): Arqaam Capital MENA Investors Conference 2018, Four Seasons Resorts, Dubai.

24-25 September (Monday-Tuesday): Egypt Water Desalination Forum, venue TBD.

26 September (Wednesday): E-Commerce Summit, Nile-Ritz Carlton, Cairo.

27 September (Thursday): CBE’s Monetary Policy Committee meeting.

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

23-24 October (Tuesday-Wednesday): Intelligent Cities Exhibition & Conference 2018, Fairmont Towers Heliopolis, Cairo.

15 November (Thursday): CBE’s Monetary Policy Committee meeting.

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

22 November (Thursday): US Thanksgiving.

25-28 November (Sunday-Wednesday): 22nd Cairo ICT, Cairo Convention Center, Nasr City, Cairo.

03-05 December (Monday-Wednesday): First Egypt Defense Expo, Egyptian International Exhibition Center, Cairo.

25 December (Tuesday): Western Christmas.

27 December (Thursday): CBE’s Monetary Policy Committee meeting.

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).

10-13 October 2019 (Tuesday-Sunday) Big Industrial Week Arabia 2019, Egypt International Exhibition Center.

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. © 2020 Enterprise Ventures LLC.