Monday, 12 November 2018

What you’re paying for under the new universal healthcare system — and when


What We’re Tracking Today

Ten out of 10 economists we surveyed expect interest rates to be left on hold when the central bank meets this coming Thursday. Read more in our inaugural poll of economists in this morning’s Speed Round, below.

You’re about to pay more taxes, including a new levy on your top line. There’s plenty of bad information circulating about how new levies to support the Sisi administration’s universal healthcare system will work. We have the rundown in this morning’s Speed Round, below.

We’re at the halfway mark for earnings season this morning as we approach the end-of-week deadline by which most companies will file. With half of the 30 components of the EGX30 have filed, according to Shuaa Securities Egypt, more than half have reported improved revenues and earnings. Among the index heavyweights still to file: EFG Hermes, ElSewedy Electric, Telecom Egypt, Ezz Steel and Qalaa Holdings.

One of Egypt’s best friends in Congress has lost his re-election bid. Rep. Dana Rohrabacher, the long-serving Republican from California, has narrowly lost his bid to stay in office. Rohrabacher penned a late 2016 letter declaring that President Abdel Fattah El Sisi a friend of the United States and a “defender of all the good things that we believe in” and calling Egypt a “partner for peace.”

The Middle East Solar Industry Association (MESIA) Solar Energy Trade Missionruns today and tomorrow at the Marriott in Zamalek. The gathering will look at the state of renewables and cleantech in Egypt.

A Libyan peace conference gets underway this morning in Italy, aiming to “push forward a new UN plan to stabilize the troubled North African country after a initiative to hold elections next month failed,” Reuters said. There was no word at dispatch time on whether Gen. Haftar Khalifa, the Egypt- and UAE-backed military commander whose forces control much of the east, planned to attend.

Saudi and Russia are at odds over production cuts: Two of the world’s largest crude producers are at odds over what the market looks like heading into 2019. Saudi Arabia is leading OPEC toward a production cut, pledging to slash its production by as much as 500k barrels a day in December, but Russia isn’t on board, arguing that any slack in supply is “short term.” Saudi Arabia is pushing OPEC and its allies to slash output by up to 1 mn barrels, and Oman Oil Minister Mohammed bin Hamed al-Rumhi said on Sunday that a majority of OPEC and other oil exporters would back the move. Russia has for the past two years moved in lock step with Saudi on production targets. Oil is now in a bear market, trading down more than 20% from the four-year high it hit just a month ago.

Can active fund managers recover after a disappointing October, the Financial Times’ Market Questions column wonders. Active managers have “long argued that a return to market volatility would renew their appeal” and are now “looking for fresh excuses after delivering disappointing returns in October when the Vix index — Wall Street’s fear gauge — rose sharply,” the salmon-colored paper write. US large-cap active managers posted their worst monthly results since September 2011.

In Saudi-themed miscellany this morning:

  • Alwaleed bin Talal is back in the spotlight a year after having been given a late checkout from the Ritz Carlton. (WSJ)
  • Erdogan claims to have given a recording of the murder of Jamal Khashoggi to the United States, Britain, France, Germany and Saudi Arabia. (NYT)
  • Officials close to MbS allegedly discuss whacking enemies a year before the killing of Khashoggi. The alleged plot saw officials as a “small group of businessmen last year about using private companies to assassinate Iranian enemies of the kingdom.” (NYT)

Fortune magazine is now owned by a Thai business leader, Dealbook reports. It’s part of a trend of the US business press being snapped up by Asian and European investors, Felix Salmon writes for Axios.

Chinese online retailer Alibaba set a new record for single-day e-commerce sales yesterday on Singles Day, moving some USD 30.8 bn worth of merchandise. That’s nearly triple the combined total of every US company’s “black Friday” and “cyber Monday” sales, Business Insider reports.

It sounds like the opening line to a bad joke: A Bahraini prince, an Egyptian ‘businessman’ and a Bollywood star walk into a… An Egyptian ‘businessman’ in Dubai is suing a Bahraini royal who allegedly backed out of a USD 33 mn pact to meet Bollywood actors. One Ahmed Adel Abdallah Ahmed is suing Sheikh Hamad Isa Ali Al-Khalifa, a cousin of the Bahraini king, alleging Al-Khalifa owes him mns for having arranged meetings with some of Bollywood’s biggest stars, including Shah Rukh Khan (above, center). The story has crossed over into the Financial Times, which notes that Al-Khalifa is set to give evidence in the case this week. See also reports in the Independent and New Indian Express.

Enterprise+: Last Night’s Talk Shows

Education Minister Tarek Shawki blanketed the airwaves last night to dispel rumors that he had called for the abolishment of unpaid public education. According to the minister, he had told MPs during a closed-door meeting that the country’s education system is inherently flawed because it requires parents to spend large amounts of money on private lessons, which negates the benefits of providing schooling without charge. Shawki also stressed that his comments, which he said were taken out of context, were not meant to be on the record. He also phoned in to Masaa DMC and El Hekaya to say the same (watch, runtime: 9: 52) and (watch, runtime: 16:57).

Taxpayers have until the end of the day today to pay overdue taxes and be exempted from 90% of late fees, Tax Authority official Saeed Fouad told Al Hayah Al Youm. The authority is expecting to surpass the EGP 2 bn mark in tax collections today, according to Fouad (watch, runtime: 5:04). Taxpayers who miss today’s deadline will be required to pay a greater percentage of late fees, the authority’s Samy Al Awady told Hona Al Asema (watch, runtime: 6:24).

Cutting tariffs on European cars will not have a marked impact on automotive prices, head of the automotive division at the Federation of Egyptian Chambers of Commerce Omar Balbaa and former engineering industries division head Hamdy Abdel Aziz said on Hona Al Asema (watch, runtime: 14:14).

In other miscellany from last night’s talk shows: Al Hayah Al Youm’s Lobna Assal had a chat with Deputy Agriculture Minister Mona Mehrez about the ministry’s plans to increase the country’s production of foodstuffs to meet local demand and turn to exports (watch, runtime: 22:42), while El Hekaya’s Amr Adib discussed the performance of the real estate sector with Memaar Al Morshedy founder Mohamed Al Morshedy (watch, runtime: 4:51). Adib also directed his attention to the country’s waste management plans (watch, runtime: 6:20).

Speed Round

Speed Round is presented in association with

EXCLUSIVE- Enterprise poll of economists sees CBE leaving interest rates on hold: The central bank is expected to leave its key interest rates on hold when its monetary policy committee meets on Thursday, an Enterprise poll of economists and research houses found. Survey participants expect the CBE will leave its overnight deposit rate and overnight lending at 16.75% and 17.75%, respectively, at the 15 November meeting, 10 economists said.

Look beyond inflation: It’s all about stemming outflows of hot money. Say what you want about higher-than-expected inflation in October: The economists we surveyed see the central bank moving to ease pressure on the EGP by giving hot-money investors more incentive to stay in Egypt. All 10 analysts polled say stemming the tide of outflows in a turbulent period for emerging markets would drive policy this Thursday: EM turbulence and a strong USD will keep interest rates on hold, said Ahmed Shams El Din, head of research at EFG Hermes. Multiples Group’s Omar El-Shenety takes it one step further, saying that protecting the EGP and the exchange rate is now among the CBE’s top policy priorities.

Just to keep it in perspective, foreign holdings in Egypt’s treasuries fell to USD 13.1 bn by the end of September, from a high of USD 21.5 bn in March, said Pharos Holding head of research Radwa El Swaify. Egypt has basically lost USD 8.4 bn in outflows between April and September, she noted.

Spike in inflation should not be cause for concern: Most of the analysts with whom we spoke underplayed the spike in annual headline inflation, which rose to 17.5% in October, up from 16% the previous month on the back of hikes in vegetable prices and school fees, state statistics agency CAPMAS said over the weekend. Despite headline inflation being well above the CBE’s announced target of 13% (+/-3%) by 4Q2018, “the elevated headline inflation readings over the past few months, including October’s, come against a largely benign underlying inflation position,” EFG Hermes said in a research note on Sunday. “We don’t see the rise in annual headline inflation as alarming, as it is driven by seasonal factors that will subside,” said lead economist at Beltone Financial Alia Mamdouh.

Annual core inflation rose to 8.86% in October from 8.55% in September, the CBE said on Sunday.

How much longer will we live with high interest rates? Beltone’s Mamdouh sees corridor rates remaining on hold until 1H2019. Pharos’ El Swaify expects the CBE will keep interest rates on hold until 3Q2019, to ensure that the emerging market turbulence has settled and that the impact of the subsidy cuts widely expected in July 2019 has passed. Capital Economics’ Jason Tuvey wouldn’t be drawn into the guessing game, declining to specify a timeframe, but pointing out that rates will have to come down in the longer term.

EXCLUSIVE- What you’re going to pay under the new Universal Healthcare Act— and when you’re going to pay it: While the state’s EGP 600 bn health insurance plan mandated under the Universal Healthcare Act will be rolled out incrementally throughout Egypt over the course of 11-13 years, the Finance Ministry is starting to collect special taxes designed to fund the scheme during the current fiscal year (2018-19). We took a deep dive into the law and spoke with friends in government to compile a list of the taxes mandated in the act and when each comes into effect

Taxes you will pay this year: Taxes ranging from a new nationwide corporate tax to industry specific taxes and fees are already in effect this fiscal year. Companies that will be impacted by the taxes will have to pay them when tax season rolls around next April or June. Notably, all of the following taxes will not be deductible from your corporate income tax.

The big one: A 0.25% tax on revenues, which the government specifies as a levy of 2.5/1000 of your top line. All companies, whether private or public and regardless of size and location, will have to pay a 0.25% tax on their sales revenues to help fund the system. The tax is payable with your next corporate tax return. This tax will apply to companies operating in Egypt’s freezones, a Finance Ministry source assured us. Freezone companies have been pushing for an exemption.

Other taxes and fees now in effect:

  • 0.5% of revenues from food and pharma companies: Companies operating in the food and pharma sectors will have to pay a tax of 0.5% on their revenues to the system. General contractors will also have to pay the 0.5% tax.
  • Healthcare industry fees: Hospitals will pay a tax of EGP 1,000 for every bed they have. Clinics and pharmacies will have to pay a set licensing fee of between EGP 1,000 and EGP 15,000.
  • Sin taxes and service fees: The law imposes fees on issuing and renewing drivers licenses ranging from EGP 20 to EGP 300. The law also sets a toll fee on highways. An EGP 0.75 sin tax all cigarette packs sold and a 10% tax on all other tobacco products has been mandated. A 5% fee on hospital stays will also be imposed. All of these levies will go directly into funding for the healthcare system.

Mandatory premiums will be paid as the system is rolled out: The premiums that employers and employees have to pay to be part of the system will be paid once the the health insurance scheme rolls out in a particular governorate. The bill will set premiums for employers of 4% of each employee’s monthly salary. Employees will pay premiums equivalent to 1% of their salary into the system. An employee will have to pay a premium of 3% of his or her salary to cover an unemployed spouse and 1% for each child. The state will pay EGP 200 bn to cover those exempt for paying premiums based on their income levels. The state will pay the equivalent of 5% of the standard minimum wage to cover healthcare for each person who cannot afford to pay a premium into the system. The government will decide criteria for exemption.

Who will be the fist guinea pigs paying the premiums? The Canal cities, where the system rolls out in May 2019.

Industry to the FRA: Make clear why Beltone was suspended over the Sarwa IPO or everyone could suffer: The Financial Regulatory Authority needs to make clear why it suspended Beltone Financial’s IPO unit or risk harming the market for capital raisings and for the state’s own privatization program, says Ahmed El Guindy, a veteran investment banker and co-founder of Tanmeya Capital Ventures. Al Mal quotes El Guindy as urging the community not to prejudge Beltone before learning the details of the FRA’s decision and warned that the lack of information surrounding the case may scare both investment banks looking to advise on future listings and companies that are looking to IPO.

Was Beltone informed of the alleged irregularities? The FRA has reportedly sent Beltone a letter detailing the alleged violations, but they were not disclosed publicly, according to the newspaper.

Gov’t could cut citizens earning more than EGP 7,000 per month from welfare rolls: There is a “direction” within government to cut Egyptians earning more than EGP 7,000 per month from the nation’s subsidy rolls, Supply Minister Ali El Moselhy said at a meeting with the House Legislative Committee yesterday, Al Masry Al Youm reports. According to El Moselhy, the EGP 7,000 figure — which Bloomberg notes is double the average monthly wage — is not final and that the wage cap the government settles on will take into consideration expenses such as electricity consumption and taxes. There are currently some 1 mn ration card holders who clearly do not need to rely on food subsidies, the minister said.

Trial balloon as ministry takes to the airwaves: The ministry is in the process of removing high-income citizens from the ration card system, Assistant Supply Minister Ibrahim Ashmawy told Al Hayah Al Youm’s Lobna Assal last night (watch, runtime: 1:05). The process should eliminate some 4-6 mn moochers from the country’s subsidy rolls, he predicted (watch, runtime: 1:36).

Is the switch to cash subsidies coming next year? The Supply Ministry has reportedly formed a committee to determine the price of subsidized bread loaves as it looks to begin switching to a cash subsidy system as early 1Q2019, ministry sources said. The news comes after El Moselhy met last week with bakers of subsidized bread to look into a new system whereby subsidy recipients would receive cash handouts, rather than points on their ration cards with which to purchase bread.

How the system works today: The ministry last looked at changing bread production prices in March. The new system could introduce a separate card specifically for subsidized bread. Subsidy card holders are currently given EGP 50 per family member each month to purchase commodities, in addition to each member being allotted five loaves of subsidized bread per day. Surplus bread points can be used to buy other commodities through subsidy vendors.

Background: Overall spending on commodity subsidies is set to rise 36.6% this fiscal year to EGP 86.18 bn. The government has been considering since July reworking eligibility conditions for the commodity subsidies system as it focuses on reducing the number of beneficiaries that receive subsidized commodities and raising the number of those eligible for bread subsidies instead during FY2018-19.

Banking sector continues to seek large foreign loans to prop up the EGP? Banque Misr is looking to borrow USD 550 mn from foreign lenders before year-end “to improve USD liquidity,” Vice Chairman Akef El Maghraby told Reuters. No details were provided on which foreign lenders the bank was considering, but El Maghraby said Citibank and Emirates NBD will arrange the loan. As we noted last week, Arqaam Capital figures the banking industry has propped up the EGP by providing as much as USD 4 bn to cover outflows as foreign investors have exited Egyptian debt. The system needs an infusion of about that same amount to ensure it can continue to serve as a shock-absorber for the EGP, the bank said, suggesting the CBE should dip into its reserves. Banks, state-owned institutions in particular, have in the meantime sough significant injections of USD from international lenders.

INVESTMENT WATCH- China’s Hanergy looks to invest USD 450 mn in solar industrial park: China’s Hanergy Thin Film Power Group plans to invest at least USD 450 mn in Egypt to build a photovoltaic industrial park, company head Yang Kai said, according to Xinhua. "The project has already got a partner in Egypt and we have begun its feasibility study," Kai said, adding that the project will generate jobs for 3k people. No details on the time frame of the project or the Egyptian partner were provided.

Court begins hearing EUR 150 mn lawsuit against Peugeot: A lawsuit brought by Arabia Investments, Development and Financial Investment Holding Company (AIND) subsidiary Cairo For Development and Cars Manufacturing (CDCM) against Peugeot Citroen for unexpectedly ending their 41 year-old partnership began in a Cairo court on Sunday. The plaintiffs are seeking damages of EUR 150 mn. The Peugeot-Citroen arm of Groupe PSA had selected a consortium of Mansour Group and Dubai-based Scope Investment to be its licensed distributor of Peugeot vehicles in Egypt in November of last year.

EARNINGS WATCH- Ibnsina Pharma reported a 26.6% y-o-y increase in net profit to EGP 113.2 mn in 3Q2018, according to the company’s earnings release (pdf). Revenues grew 31.9% y-o-y during the quarter, coming in at nearly EGP 3.5 bn, with growth being driven by client pharmacies, the company said. “Management’s long-term goal is for Ibnsina to become a leading healthcare supply business provider, and the path to doing so in a structured and profitable manner lies in fostering economies of scale,” according to Co-CEO Omar Abdel Gawad. “As the company expanded its client book and distribution network during the period, Ibnsina Pharma was able to spread its costs over a wider revenue base. Management is confident that the controlled and reduced costs associated with increased operational scale, coupled with Ibnsina Pharma’s other competitive advantages, will bring us closer to our long-term goals,” he added.

Sarwa Capital reported 3Q2018 net income of EGP 100.4 mn in its maiden earnings report, up 104% y-o-y, according to a press release (pdf). The structured finance player said its results “showcase the strong growth and diversified growth dynamics within the business. Going forward, we expect continued strength across our product lines, while keeping a close eye on the macroeconomic and monetary environments to ensure that we remain well positioned to achieve growth while maintaining our unrivalled credit quality and performance.”

LEGISLATION WATCH- Cabinet will introduce a Customs Act in the House within the coming few weeks, Finance Minister Mohamed Maait told the committee yesterday. The bill is meant to bring customs legislation in line with international agreements and raise Egypt’s ranking in a number of global indices, including the World Bank’s Doing Business report. You can read the latest draft of the bill here (pdf) on the Finance Ministry website.

LEGISLATION WATCH- Public Procurement Act to be implemented in FY2019-20? The Public Procurement Act will be implemented in FY2019-20, said Khaled Noufal, assistant to the Finance Minister for administrative reform. The delay would allow government bodies to amend their tendering procedures in accordance with the law, he explained. The law grants preferential treatment in government tenders to products with at least 40% domestic content. The act is meant to support the growth and development of domestic industry. President Abdel Fattah El Sisi had signed the legislation into law last month.

Also approved yesterday: Parliament’s Education and Scientific Research Committee signed off on amendments to the Universities Act, including clauses governing unpaid vacations and hiring precedence for teaching assistants, according to Al Mal.

LEGISLATION WATCH- A bill that would remove the ‘religion’ field from national ID cards is back from the dead: A private member’s bill will seek to remove the religion field from national ID cards and all other official state documents, according to El Watan News. Rep. Ismail Nasr El Din, the backer of the bill, he will be seeking co-signers for his bill. A similar bid in 2016 to strike religion from ID cards went nowhere.

Ex-Food Industries Holding Company head Alaa Fahmy is heading to trial on graft charges. Prosecutor General Nabil Sadek has referred the former chairman of the state-owned Food Industries Holding Company (FIHC) Alaa Fahmy to trial in criminal court on charges of corruption and graft, according to Al Ahram. Fahmy was arrested last May along with an official from his office and two Supply Ministry officials and charged with accepting bribes worth EGP 2 mn in exchange for facilitating payments and purchase orders. A subsequent investigation by the Administrative Control Authority now sees Fahmy facing allegations he accepted bribes and favors worth some EGP 982k.

Delek to sign new gas import agreements with Egypt? “We signed agreements with EMG to supply gas to Egypt, and we believe that additional agreements will be signed for local needs and liquefaction facilities in Egypt,” Delek Group controlling shareholder Yitzhak Tshuva said on Sunday at an investors’ conference in Tel Aviv, according to Globes. He did not elaborate on the details on potential agreements with Egypt. Tamar and Leviathan partners Delek Group and Noble Energy bought in September a 39% stake in the East Mediterranean Gas (EMG) pipeline with Egyptian partner East Gas, with an eye to sell Tamar and Leviathan gas to Egypt through EMG. "We are headed for very significant and special year. 2019 will be the year in which we produce gas from Leviathan," he added. “Early in the fourth quarter of 2019, we will begin pumping gas from Leviathan to the Israeli economy and the neighboring countries,” said Delek Drilling CEO Yossi Abu.

What about capacity issues on deliveries? The positive tone set by Tshuva and Abu did not mention concerns noted last week by Bloomberg that Israel does not have the pipeline capacity to send gas to Egypt when the Leviathan field comes online. While both Delek and Noble said they were working on it, no concrete solution has been presented as of yet.


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Egypt in the News

The foreign press has nothing to say about Egypt beyond rehashing the discovery of mummified scarab beetles and cat statues. Let’s all enjoy this while it lasts.

Worth Reading

SMEs and entrepreneurship are on the rise in the GCC, but key reforms are needed to help innovators thrive, Huda Al Lawati writes for Entrepreneur Middle East. Governments in the GCC are well aware of the rising importance of SMEs in contributing to economic growth and creating jobs, but the sector’s contribution to overall GDP remains small when considering its potential. While the entrepreneurial ecosystem in the region is beginning to see the establishment incubators, accelerators, and other tools to promote growth in the industry, Al Lawati sees an increasingly pressing need for institutional reforms to allow entrepreneurship to flourish in the GCC.

It all starts with education… Entrepreneurs often gain access to startup workshops and other initiatives geared toward providing relevant information after having “already missed out on a lot of preparation” during the early stages of education. Public schools must begin shifting away from syllabi geared towards rote memorization in favor for a holistic system that promotes independent thinking and a problem-solving approach, Al Lawati says.

…But legal and regulatory reforms are just as crucial. The introduction of the limited liability concept is imperative in the GCC, where bankruptcy remains grounds for imprisonment. “We find it difficult to embrace failure as part of any learning journey. Culturally, we are not very tolerant of failure, but this is only a very small part of the real issue at hand … The capitalist system has thrived on the concept of limited liability, whereby the risk that you take with a venture is limited to that which has been contributed into the venture, and nothing more. However, we have not implemented this truly into our corporate law.”

Startups are also faced with the unnecessary operational costs, such as paying to rent a working space that governments see as a requirement for any business in any stage of development, despite the fact that many small businesses do not need a physical office. Al Lawati says it is far more practical to introduce corporate taxes, which would not be applicable to ventures in their early phases or those that are incurring losses.

Worth Watching

Methanex Egypt, ILO help Damietta women grow small businesses: Methanex Egypt provided entrepreneurial training sessions for 108 women in Damietta as part of the GET Ahead for Women initiative, the local arm of the global methanol producer said. In collaboration with the International Labor Organization Cairo and the National Council for Women, the trainings focused on ways women can expand and grow their already operating businesses as well as business management training to help them develop a successful business model and plan. The one-month training program also included risk management and problem-solving classes for women who ran businesses in the past, but were forced to shut down in the face of obstacles. Participants also brainstormed ideas of how to tackle challenges in customer service, finance and logistics. (watch, runtime: 6:01)

Diplomacy + Foreign Trade

Foreign Minister Sameh Shoukry met yesterday with Bahraini Prime Minister Khalifa bin Salman Al Khalifa on the sidelines of a meeting of the Egyptian-Bahraini Joint Committee in Manama, according to a Foreign Ministry statement. The two leaders discussed enhancing cooperation in the fields of energy, entrepreneurship, and technology. Egypt and Bahrain also signed a MoU on renewable energy cooperation, Al Masry Al Youm reports.

Shoukry also met with King Hamad bin Isa Al Khalifa to discuss issues of mutual interest including regional security.

French consultancy threatens to withdraw from completing GERD study as Egypt pushes for more talks: French consultancy firm BRL Group and Dutch Deltares sent letters to Egypt, Sudan and Ethiopia threatening to withdraw from completing the Grand Ethiopian Renaissance Dam (GERD)’s environmental impact study if the three countries continue to disagree on the firms’ reports, sources tell Al Shorouk. The firms’ threats has apparently helped the three countries reach “temporary solutions” that should allow the firms to continue their work without further interruption. Sources had said last week that the delays in reaching an agreement on the results of the environmental impact study could result in Egypt, Sudan, and Ethiopia facing penalties from the consultancy.


300 mcf/d of gas exports from Idku liquefaction plant -sources

-Royal Dutch Shell’s Idku liquefaction plant is reportedly exporting 300 mcf/d of natural gas, compared to 250 mcf/d last month, sources close to the matter said yesterday. Natural gas earmarked for exports increased by around 50 mcf/d due to lower local consumption levels during winter. Shell and the Oil Ministry had agreed back in 2016 to gradually ramp up production at the Idku LNG plant.


Egypt signs MoU with CDR to plan upgrades at Alexandria Port

The Alexandria Port Authority signed an MoU with Dutch port engineering and consulting company CDR to conduct a technical study of Alexandria Port’s docks and piers and present a plan to upgrade the port’s infrastructure. The agreement stipulates that CDR must complete its study and present its results within eight months of signing the memorandum.


UK parliamentary group says it is pressuring the UK to restore flights to Sharm

The Egyptian-British Parliamentary Friendship Association sees that the UK’s travel ban on flights to Sharm El Sheikh should be lifted and is working on pressuring the UK government, said British MP Stephen Timms, according to Ahram Online. Timms, who heads the association, made his comments to Tourism Minister Rania Al Mashat during her UK visit to attend the World Travel and Tourism Council (WTTC). This is the latest in a string of statements by UK MPs who believe that the flight ban serves no purpose at this point in time. Yet the UK government, while continuing to promise to work on lifting the ban, has done nothing of note on that front.

Automotive + Transportation

Ali Abdel Aal says metro ticket prices “must be raised”

Metro ticket prices “need to be raised” to maintain service quality, House Speaker Ali Abdel Al said yesterday, according to Al Masry Al Youm, in what is a turnaround from last month’s uproar in parliament over the government’s proposed ticket prices hikes for Cairo Metro 3 riders. Abdel Aal’s statement suggests that price hikes are all but certain.

Banking + Finance

Kuwait’s KAMCO to launch investment banking operations in Egypt early next year

Kuwait’s KAMCO Investment Company expects to begin operating as a licensed investment bank in Egypt early next year after obtaining the necessary licenses from the Financial Regulatory Authority (FRA) by year’s end, Managing Director and Head of Mergers and Acquisitions Sherif Abdel Aal told Al Mal. The new investment bank will focus in its early stages on securing IPO mandates, he said, adding that the firm will likely hire foreign managers to head its Egypt operations. Zaki Hashem & Partners acted as legal adviser for KAMCO in Egypt.

Real Estate

Tatweer Misr, GEN to build EGP 120 mn entrepreneurship center

Real estate developer Tatweer Misr signed an MoU yesterday with Global Entrepreneurship Network (GEN) to establish a EGP 120 mn center for entrepreneurship and innovation as part of Tatweer Misr’s Bloomfield project at Mostakbal City, state-run Al Ahram reports.

The Market Yesterday

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EGP / USD CBE market average: Buy 17.85 | Sell 17.95
Buy 17.86 | Sell 17.96
EGP / USD at NBE: Buy 17.78 | Sell 17.88

EGX30 (Sunday): 13,571 (-1.2%)
Turnover: EGP 611 mn (16% below the 90-day average)
EGX 30 year-to-date: -9.6%

THE MARKET ON SUNDAY: The EGX30 ended Sunday’s session down 1.2%. CIB, the index heaviest constituent, ended down 1.9%. EGX30’s top performing constituents were Global Telecom up 6.2%, Orascom Investment Holding up 2.3%, and Egypt Aluminum up 1.5%. Yesterday’s worst performing stocks were Egyptian Resorts down 4%, SODIC down 3.8% and Emaar Misr down 3.3%. Turnover stood at EGP 611 mn with foreigners the sole net buyers.

Foreigners: Net Short | EGP -10.5 mn
Regional: Net Long | EGP +0.2 mn
Domestic: Net Long | EGP +10.3mn

Retail: 78.6% of total trades | 82.5% of buyers | 74.6% of sellers
Institutions: 21.4% of total trades | 17.5% of buyers | 25.4% of sellers

WTI: USD 60.76 (+0.95%)
Brent: USD 70.79 (+0.87%)

Natural Gas (Nymex, futures prices) USD 3.75 MMBtu, (+0.94%, December 2018 contract)
Gold: USD 1,210.30/ troy ounce (+0.14%)

TASI: 7,711.11 (-0.42%) (YTD: +6.71%)
ADX: 5,002.25 (-0.53%) (YTD: +13.73%)
DFM: 2,817.72 (-0.29%) (YTD: -16.39%)
KSE Premier Market: 5,300.82 (+0.03%)
QE: 10,390.01 (+0.21%) (YTD: +21.90%)
MSM: 4,503.68 (+0.27%) (YTD: -11.68%)
BB: 1,312.57 (-0.05%) (YTD: -1.44%)

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12-13 November (Monday-Tuesday) Mesia Solar Trade Mission, Cairo Marriott Hotel & Omar Khayyam Casino, 16 Saray El Gezira Street, Zamalek, Cairo, Egypt

13-29 November (Tuesday-Thursday): UN Biodiversity Conference, Sharm El Sheikh, Egypt.

14 November (Wednesday): Egypt M&A and Private Equity Forum, Nile Ritz Carlton Hotel, Cairo, Egypt.

14-15 November (Wednesday-Thursday) Digitalisation: opportunities for innovation in consultancy, Marriott Mena House Hotel, Cairo, Egypt

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

15 November (Thursday):  The T20 Invest in Healthcare Conference 2018, Nile Ritz Carlton Hotel, Cairo, Egypt.

17-19 November (Saturday-Monday): ElectricX-Energizing The Industry, Egypt International Exhibition Center, Cairo, Egypt.

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

22 November (Thursday): US Thanksgiving.

End of November: A delegation from the Egypt-Greece Business Council will visit Athens at the end of November to promote investment, the council’s chairman, Hani Berzi, said.

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.

04 December (Tuesday): Egypt’s Emirates NBD PMI for November released.

08-09 December (Saturday-Sunday): Business for Africa and the World: The Africa 2018 Forum, Maritim Jolie Ville International Congress Center, Sharm El Sheikh.

09-10 December (Sunday-Monday): Cairo Regional Centre for International Commercial Arbitration’s Sharm El Sheikh VII conference, Egypt Hall, SOHO Square, Sharm El Sheikh

12 December (Wednesday): Banking and Finance Congress 2018, Cairo, venue TBD.

13-15 December (Thursday-Saturday): Forum on “ The Role of Digital Financial Communication and Solutions in Enhancing Financial Inclusion,” Sharm El Sheikh, venue TBD.

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.

22-25 January 2019 (Tuesday-Friday): World Economic Forum (WEF) Annual Meeting, Davos-Klosters, Switzerland.

23 January 2019 (Wednesday) 50th Cairo International Book Fair.

25 January 2019 (Friday): Police Day, national holiday.

20-22 April 2019 (Friday-Sunday): Spring meetings of the World Bank and International Monetary Fund, Washington, DC.

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.

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