There’s plenty for the business community to digest this morning, and almost all of it is coming out of the House of Representatives. MPs passed what can only be called a torrent of legislation yesterday, including an authorization to send troops to Libya as well as business-relevant legislation including:
- The long-awaited Banking and Central Bank Act;
- A 1% “corona” surtax on all employee wages in the public and private sectors;
- Stamp and withholding tax cuts for EGX transactions;
- Setting up a new authority to regulate outdoor advertisements;
- A tax break for state-owned companies.
We have the full rundown in this morning’s Speed Round, below.
Does this mean we’re going to war? Not yet. The House gave President Abdel Fattal El Sisi the green light to deploy troops in a potential military operation to counter “terrorist groups” and “militias” — language that matches up with a statement (pdf) the presidency released after Sunday’s meeting of the Egypt’s National Defense Council that that specifically “emphasized [Egypt’s] commitment to a political solution as the way to end the Libyan crisis.” Pundits have drawn a line under both the NDC statement and the words “terrorist groups” and “militias” in the authorization bill as signaling that Egypt is looking to push a diplomatic solution. Policymakers have emphasized the flashpoint would be if Ankara’s proxies move on the strategically important town of Sirte.
The nation’s diplomats are working overtime: El Sisi and the heads of state of Ethiopia and Sunday will try today to find a way through the deadlock on the Grand Ethiopian Renaissance Dam at a virtual summit organized by the African Union. Technical and legal teams had little joy resolving the key points of dispute over 11 days’ of talks earlier this month, and pressure is mounting as Ethiopia threatens to begin filling the dam’s reservoir.
It looks like our elected representatives can kiss goodbye their recess this year: House Speaker Ali Abdel Aal yesterday adjourned the current session and announced that MPs will be recalled to the House to get back to work on 16 August. The reason for a three-week break? The senate elections, which will be held on 11-12 August.
Plans for the new public school year will be announced in the first week of September, Education Minister Tarek Shawki said on his Facebook earlier this morning. Public schools will start the academic year on 17 October, but there’s some question as to whether private international schools will be allowed to start in-person instruction before that date, we reported in our weekly Blackboard yesterday. Look for schools to adopt a hybrid model this fall, with elementary schoolers going to class more frequently — and online education a bigger part of the menu for kids in upper years.
PSA- We have a four-day workweek next week. The wa’fa will fall on Thursday, 30 July, Dar Al Ifta said in a Facebook post last night. That means the first day of Eid will be Friday, 31 July. That suggests we’re back to work on Tuesday, 4 August.
REMINDER- This coming Thursday is a national holiday in observance of the 23 July 1952 Revolution.
COVID-19 IN EGYPT-
The Health Ministry confirmed 627 new cases of covid-19 yesterday, bringing the country’s total infections to 88,402. There have now been 4,352 deaths after the ministry reported 50 new fatalities yesterday. We now have a total of 28,924 cases who have fully recovered.
EgyptAir’s flight schedule will be back to about 50% of its pre-covid level next month as the national flag carrier adds 10 more routes to its daily schedule starting next month, CEO Roshdy Zakaria said in an interview with Masaa DMC last night (watch; runtime 8:38). This will mean the airline operates 30-35 flights daily, compared to 80 prior to the pandemic.
Egypt will serve as the African manufacturing and distribution center for a Chinese covid-19 vaccine under a preliminary agreement between Health Minister Hala Zayed and Chinese ambassador Liao Li Chang, a cabinet statement said. It did not disclose the name of the Chinese pharma company producing the vaccine or provide other details. Health Ministry spokesperson Khaled Megahed told El Hekaya’s Amr Adib that the vaccine should cover 20% of Egypt’s needs when it is ready, but didn’t shed any light on which company is manufacturing it (watch, runtime: 13:05).
EDA decides public pricing for covid meds: The Egyptian Drug Authority has decided that a 40-tablet pack of Anvirizam will be sold to the public for EGP 1,260 while the market price for a vial of Remdesivir will be EGP 680, Rameda Pharma said (pdf) yesterday. Rameda announced last month that it would begin producing the antiviral medications.
Mask-makers are lobbying for permission to export surplus face masks, Masrawy suggests, citing an official from the Federation of Egyptian Industries’ textiles division .
IN THE REST OF THE WORLD-
Chevron is acquiring Noble Energy for USD 5 bn, giving the Houston-based group control of the Israeli Leviathan gas field and massively expanding its Mediterranean assets, Reuters reports. The acquisition likely marks the beginning of a series of consolidation agreements that will take place in the aftermath of crude oil price collapse and the continued spread of covid-19, according to the FT.
Why should you care? Noble is one of two companies that inked a USD 15 bn agreement to export natural gas to Egypt from massive Israeli gas fields, making it one of the lynchpins of Egypt’s strategy of becoming a regional energy hub for the Eastern Mediterranean.
Saudi Arabia’s King Salman bin Abdulaziz, 84, was admitted to a hospital in Riyadh yesterday for medical tests after being diagnosed with an inflamed gallbladder, according to the Saudi Press Agency. Salman’s hospitalization, which comes a day after Kuwait’s 91-year-old ruler Sheikh Jaber Al Ahmad Al Sabah underwent surgery, could be cause for “uncertainty” in the Gulf countries amid the pandemic and a crisis in the crude market, Bloomberg suggests.
Locusts worse than covid? The swarms of locusts rampaging around parts of East Africa, the Middle East and South Asia could pose “a bigger threat in some of these countries than COVID-19,” the CEO of agricultural data firm Gro Intelligence tells Axios. While disruptions to global food supply chains are unlikely, locust outbreaks could be hugely disruptive to countries facing food insecurity, “leading to localized supply shocks rippling through the international economy due to, for instance, currency crises or increased migration,” Gro analysts said in an email.
We’ve had plague, but it looks like we’re going to sidestep pestilence: The UN FAO’s Desert Locust Watch page doesn’t show any threat to Egypt this morning.
UK accounting firms have been left red-faced after the country’s watchdog pointed to endemic auditing failures in the industry. The Financial Reporting Council said last week that a third of company audits carried out by the so-called ‘Big Four’ (KPMG, Deloitte, EY and PwC) and several smaller firms failed a quality test, Reuters reports. Accounting firms have been under close scrutiny from regulators after a series of high profile scandals and corporate failures, and earlier this month were ordered to spin-off their auditing arms in the next four years.
Alibaba’s payments arm Ant Group has announced a dual-listing IPO in China and Hong Kong in what would represent one of the biggest IPOs of an Asian company, according to the Financial Times. The company has not provided a timeline for its listing or said how much it is aiming to raise, but was most recently valued at USD 150 bn in 2018.