Wednesday, 25 November 2020

More positive vaccine news — but we might not get one before mid-2021


What We’re Tracking Today

Good morning, friends, and welcome to our last issue of the week.

The three big themes of today’s news cycle here at home: Covid, railways and debt. On the covid front, the government is getting frustrated by our inability to take a second wave seriously — and there’s more good news on the vaccine front, this time from Russia.

On the right side of the tracks: The Cairo ICT expo, which is on its final day today, saw a flurry of railway agreements signed yesterday, including the official establishment of the new railway company owned by the Sovereign Fund of Egypt, the Suez Canal Economic Zone, and private sector players Orascom Construction, Samcrete, and Hassan Allam.

And there’s plenty of chatter in the market on debt issuances — including securitized bonds and sukuk that are expected to go to market before the year is out.

We have chapter and verse on all three stories in this morning’s Speed Round, below.

Wait, if y’all are Egyptian, why are you taking Thanksgiving off? We’re not making Black Friday shopping lists, folks, and we’re not expecting our turkey coma to outlast our afternoon nap. Instead, we’re taking the day to put the final touches on something new. We’ll be back in your inboxes at our usual 6am CLT on Sunday morning.

Three things to keep the nerds among you entertained while we’re on our publication holiday tomorrow:

  • Productivity nerds need to drop everything and go read Cal Newport’s The rise and fall of getting things done in the New Yorker. If you’re one of those people who worry about how to stay organized and you know what “GTD” means, read this now and thank us later.
  • Add to your TBR pile: The New York Times’ 10 best books of 2020 is out covering fiction and non-fiction. Or head over to the FT’s epic Books of the Year 2020, which covers everything from mysteries and thrillers to history, business and economics. (TBR, for the uninitiated, is nothing more complicated than To Be Read — an an obsession of book nerds.)
  • Tech nerds need to order the 16 GB version of the M1 MacBook Pro, MacRumors advises, picking up on a video from Max Tech. If you haven’t already, you need to read reviews of the devices by ur-nerds Nilay Patel and John Gruber.

PSA #1- Brace yourself for showers in the capital city today through Friday. The national weather service is calling for heavy rain along the Mediterranean coast and showers in the Greater Cairo Area today through Friday. The government is warning local officials to take stuff seriously and schools are closed today in at least six governorates including Alexandria, Matrouh, Beheira, Dakahliya Damietta and Kafr El Sheikh.

The (virtual) Canada-Arab Business Forum wraps today. The forum makes the case for more trade and investment between Canada and the Arab world. Ministers and industry experts will be talking, and you can sign up here.

PSA #2- Growth-stage tech startups in Egypt and the rest of MENA can now apply to Google’s Startups Accelerator, according to a statement (pdf). The accelerator is accepting applications until 31 December. Some 10-15 startups will be selected as part of the first cohort of the three-month digital accelerator program, which kicks off in January.

enterpriseBringing you the latest in delicious dining options for you and your family to enjoy, Somabay has proudly expanded its F&B outlets and welcomes aboard our latest additions. Say hello to the Burger Factory and Baladina, now open at the Marina for mouthwatering meals.

The Health Ministry reported 361 new covid-19 infections yesterday, up from 354 the day before. Egypt has now disclosed a total of 113,742 confirmed cases of covid-19. The ministry also reported 13 new deaths, bringing the country’s total death toll to 6,573. We now have a total of 102,103 confirmed cases that have fully recovered.

FROM THE DEPT. OF WE TOLD YOU SO- Five airlines will begin distributing a “CommonPass” for passengers to show they’ve tested negative for covid-19 in a bid to make travelling easier, the Financial Times reports. United Airlines, Lufthansa, Virgin Atlantic, Swiss International and JetBlue will begin doling out the World Economic Forum-backed passes as of next month. Canada’s CBC suggests a number of airlines are bracing for proof of vaccination to become a prerequisite for anybody expecting to board a plane post-pandemic.

^^ Toz, anti-vaxxers.

SIGN OF THE TIMES- The pandemic has brought out our love for e-commerce: Some 72% of Egyptians have been online shopping more since the pandemic began, a new study by Mastercard found, according to a press release. Nearly two thirds said they have bought more clothing online, while 56% said they purchased more electronics, and 55% reported using online platforms to buy meds. More than half of those surveyed (57%) said they also started banking online.


Biden, vaccines push Dow to 30k: US stocks surged to record highs yesterday after president-election Joe Biden finally began the transition process to the White House and in reaction to the recent spate of positive vaccine news. The Dow Jones closed above 30k for the first time ever while the S&P500 rose 1.6% to close at a record high. (Bloomberg | FT | Reuters | AP | WSJ)

“America is back,” president-elect Biden declared yesterday as he officially announced his national security team and kicked off the transition to his administration. Biden’s long-time foreign policy aide Anthony Blinken was the confirmed pick for secretary of state, seasoned diplomat Linda Thomas-Greenfield is the new US ambassador to the UN while ex-Obama staffer Jake Sullivan will be national security advisor. Ex-secretary of state John Kerry has been selected for climate envoy. Reuters, Bloomberg, the Financial Times, and the Washington Post all have the story.

Among the handful of international headlines you might want to know about this morning:

  • Goldman Sachs is asking existential questions of OPEC+, which starts a two-day meeting next Monday. GS is concerned about suggestions the UAE may be about to bail on the cartel. CNBC has more.
  • Europeans are getting on the SPAC bandwagon, joining wealthy Americans who’ve been increasingly using special-purpose acquisition companies (SPACs) to raise funds for takeover bids. Bloomberg has the story.
  • Ethiopian rebels aren’t going down without a fight: The leader of Ethiopia’s Tigray rebels said his forces are “ready to die” after the government gave them a three-day ultimatum before the military storms the regional capital, AFP reports.


*** It’s Hardhat day — your weekly briefing of all things infrastructure in Egypt: Enterprise’s industry vertical focuses each Wednesday on infrastructure, covering everything from energy, water, transportation, urban development and as well as social infrastructure such as health and education.

In today’s issue: Rising rental costs of commercial office space have put small and medium-size businesses in a tough situation. In part two of our series on affordable office space for SMEs, we look at how co-working and shared office spaces have grown since 2010 to offer flexibility to businesses of all sizes, generally at lower prices than commercial real estate.

Enterprise+: Last Night’s Talk Shows

Vaccines and covid-19 dominated the airwaves last night: We have full coverage on all the day’s vaccine-related news in this morning’s Speed Round, below.

School is off today in a number of governorates: Yahduth Fi Misr’s Sherif Amer phoned Alexandria governor Mohamed El Sharif, who said that schools will be suspended across the governorate today, and perhaps tomorrow if the bad weather persists. He talked about how the local authority is responding to the deluge (watch, runtime: 4:03). Amer also phoned the Matrouh (watch, runtime: 2:47) and Kafr El Sheikh (watch, runtime: 3:32) governors who confirmed their governorates will also close schools today.

Round 1 of House run-off elections wrap up: Masaa DMC (watch, runtime: 5:35), Al Hayah Al Youm (watch, runtime: 6:36), and Ala Mas’ouleety (watch, runtime: 3:37) all covered the final day of voting in 14 of the country’s governorates yesterday.

Speed Round

We can see the beginning of the end for covid in Egypt, but it may not be until mid-2021:. That’s according to President Abdel Fattah El Sisi, who suggested yesterday that negotiations to secure a stock of vaccine could drag on for a few months to come. This came during a speech on the coronavirus in which he sought to reassure that the nation’s medical experts are doing all they can to contain the virus.

You can catch El Sisi’s full speech here (watch, runtime: 12:01) if you don’t mind Ala Mas’ouleety’s Ahmed Moussa. The president’s statement got plenty of airtime last night on Kelma Akhira (watch: runtime: 1:40), Al Hayah Al Youm (watch, runtime: 12:04), Masaa DMC (watch, runtime: 13:50), and Yahduth Fi Misr (watch, runtime: 2:39).

We can expect a lot more clarity in about two weeks’ time on what vaccines we’re buying and which one we might be manufacturing here. Presidential spokesperson Bassem Rady told Kelma Akhira’s Lamees El Hadidi that the Health Ministry’s covid-19 committee will complete a study of the available vaccines within the next 10 days (watch, runtime: 10:14).

The government’s message in the meantime is clear: Vaccines are in the future. Wearing your damn mask and social distancing? That’s NOW, Higher Education Minister Khaled Abd El Ghaffar told Masaa DMC’s Ramy Radwa. The minister says 38% of beds are now occupied in intensive care units at teaching hospitals and that about 8% of hospitalized covid patients are on ventilators. He said that the rates are so far not alarming and that the healthcare system withstood the shock of the first wave (watch, runtime: 17:25).

So, what vaccines might we be buying — or manufacturing?

Health Ministry officials have previously suggested we’ve locked in about 50% of our vaccine needs, including from AstraZeneca (easily stored, 90% effective) and Pfizer (95% success rate). We’re also looking to manufacture a vaccine in Egypt — state-affiliated Vacsera, one of Africa’s top vaccine makers, is preparing a plant now.

Egypt seems to have cooled on the Chinese vaccine that was running clinical trials here. The company behind the shot has said results were “better than expected” but has yet to release data on its effectiveness. The Chinese shot was one policymakers had hoped could be manufactured here.

That leaves the question of Russia’s Sputnik V, which served up more great vaccine new yesterday: It is more than 95% effective, the Russian sovereign wealth fund said, reporting second interim analysis of the late-stage trial. The ultra-high efficacy rate was recorded in patients 42 days’ after the first dose, while a slightly lower success rate of 91.4% was observed 28 days after the dose.

Egypt has reached an agreement to buy an unspecified stock of Sputnik V from Russia, the WSJ notes in passing. Foreign Minister Sameh Shoukry said in late October that Egypt could manufacture Sputnik V here and local drugmaker Pharco has struck an agreement to distribute up to 25 mn doses, we previously noted.

The Russians are going big on the marketing, taking pains to point out that the shot will be at least 2x cheaper than the mRNA vaccines being developed by Pfizer / BioNTech and Moderna. The AstraZeneca-Oxford shot will be less expensive and will be made available to the developing world on a not-for-profit basis “in perpetuity.”

INVESTMENT WATCH- Big new rail company plans to invest USD 10 bn + tons more rail transport news from Cairo ICT: The Suez Canal Economic Zone and the Sovereign Fund of Egypt signed an agreement yesterday to set up the National Egyptian Company for Railroad Industries (NERIC) — the new company specialized in producing and refurbing locomotives — at the Cairo ICT expo Monday, according to a Planning Ministry statement (pdf). The company is expected to invest USD 10 bn over the next few years, Planning Minister Hala El Said said.

Private sector firms look like they’ll hold the majority of the equity in the new company, but the minority stake to be split by the SCZone and SFE will be preferred shares that give them extra voting rights and a claim to a larger percentage of any profits or gains on exits, El Said suggested to Kelma Akhira’s Lamees El Hadidi last night (watch, runtime: 9:09). The minister didn’t specify the extent of the preferred voting rights or the questions on which they might be exercised. The exact ownership breakdown among the private sector firms still isn’t clear but the ministry statement says that Orascom Construction (OC), Samcrete, Hassan Allam Holding and Connect Information Technology will hold stakes, with OC taking a 15% share.

The investments include a EGP 2.2 bn facility that will eventually house three lines: One to upgrade rail engines, one to produce metro cars, and another to produce high-speed, long-distance railcars, Chairman Ahmed Fekry said, according to the local press. The production lines will have a capacity of 150k pieces of rolling stock per year. The planned investment is part of a plan to modernize Egypt’s ailing railway network and kickstart rail exports to other countries in the region, Fekry added.

Other agreements signed at the expo:

  • Setting up a railway signaling control center in the Technical Institute for Rail Technology, under an agreement between the National Railways Authority and the Egyptian arm of French manufacturer Alstom.
  • The christening of the New Cairo monorail station One Ninety through an agreement between the National Tunnels Authority and Landmark Developments.
  • An MoU between the General Authority for Land and Dry Ports and a consortium of unnamed American and British companies to conduct a feasibility study for the Sohag Dry Port and logistical zone.
  • A training and skill transfer agreement between Huawei and Trans IT, which will see the Chinese tech giant provide training to its staff.
  • Setting up a railway engineering training academy in Cairo with Bombardier Transportation, to train new local engineering graduates.

OTHER RAILWAY NEWS: Orascom Construction will spend EUR 2 bn on the construction of the two monorail lines for the new administrative capital and Sixth of October, CEO Osama Bishai said at the expo, according to Al Mal. The project entails a 54-km-long monorail system connecting Nasr City with the new administrative capital, and a 42-km line between Sixth of October and Giza. A consortium made up of Bombardier, Orascom Construction, and Arab Contractors signed a 30-year contract for the construction and maintenance of the lines last year. The two lines are expected to cost more than USD 4.6 bn, USD 3 bn of which will be spent on construction and USD 1.67 bn on operating and maintaining the lines for 30 years.

OC, Mitsubishi sign USD 800 mn contract for civil works on Cairo Metro Line 4: A consortium of Orascom Construction and Japanese conglomerate Mitsubishi signed a USD 800 mn contract with the Transport Ministry for railway works for the first round of Cairo Metro Line 4, OC said in a press release (pdf). The project will be financed through a JPY-denominated loan from the Japan International Cooperation Agency, which we previously noted is funding the first phase of the new metro line. The OC-Mitsubishi consortium signed the agreement during this week’s TransMea 2020 expo, which is currently underway as part of the Cairo ICT conference.

DEBT WATCH- The debt market is really heating up heading into 2021: Two securitized bond offerings worth a combined EGP 4 bn are going to market before the end of the year, said Khalil El Bawab, the CEO of Banque Misr’s investment arm Misr Capital, which is acting as lead manager on both sales. While he didn’t disclose names of companies, the size of the issuances (EGP 2.5 bn and EGP 1.5 bn) match planned sales by Corplease and Palm Hills Developments that have been slated to take place this year.

Misr Capital has another three securitized bond offerings in its pipeline for next year and at least one sukuk issuance coming up, El Bawab said. Together, its offerings for the rest of 2020 and into 2021 are worth a combined EGP 7 bn, he said. Misr Capital and Sarwa Capital are advising Amer Group’s upcoming EGP 2 bn sukuk offering. The Banque Misr subsidiary was also tapped as lead manager for an expected EGP 1 bn securitized bond sale by AT Lease, which we noted last week was pushed to next year. The company is also working on a potential corporate green bonds sale, El Bawab added without providing details.

Securitized bonds are becoming an increasingly popular means of debt finance: Corplease, Sarwa, Palm Hills, and Raya are some of the private sector firms to sell asset-backed securities to investors this year. Sizes have ranged anywhere from Premium Card’s EGP 182 mn offering to Sarwa’s EGP 1.8 bn issuance in May. The New Urban Communities Authority has been responsible for the largest issuance this year, selling EGP 10 bn of bonds to investors to fund new developments in the new capital and New El Alamein.

OTHER COMPANIES IN THE MARKET FOR DEBT- Leading private education outfit CIRA is mulling a sukuk issuance, the company said in a disclosure (pdf). CIRA did not disclose the expected size of the sale, but ِAl Mal reports that it could be worth EGP 600 mn, according to sources familiar with the matter. The company is currently seeking the necessary permissions from the Financial Regulatory Authority, sources said.

Background: This would be the third issuance of corporate sukuk in Egypt, following Talaat Moustafa Groups’s EGP 2 bn offering in April, and the Sarwa Capital’s upcoming EGP 2.5 bn sale. Amer Group is also said to be in the market for Sharia compliant debt and could complete a sale before the end of the year.

Advisors: EFG Hermes is leading the CIRA issuance, while Zulficar & Partners is acting as legal counsel.

In other debt news, Sarwa Capital is planning to start giving out housing loans to low- and middle-income families under an agreement it recently signed with the state’s Social Housing Mortgage Finance Fund, said Managing Director Said Zater, according to Al Mal.

M&A WATCH- Sawiris’ sports investment company Zed Sports has acquired a majority stake in FC Masr, CEO Ahmed Diab confirmed to Al Mal yesterday, without providing additional details on the transaction. Hapi Journal claimed in September that an agreement had been reached between the two companies, without sourcing its claims.

STARTUP WATCH- Cairo-based sports startup Eksab has raised USD 500k from Africa-focused VC firm 4DX Ventures, a company statement (pdf) said yesterday. This is the company’s second injection of funding in the past 18 months after a seed round last June attracted a six-figure investment from 500 Startups. Eksab is a daily fantasy sports platform allowing users to make predictions about live football games, earning points based on how accurate their predictions are, and being rewarded with prizes.The platform plans to use the latest funding to launch its first paid competitions over the next year and increase its user base, the company said.

Hotel occupancy rates in Cairo nosedived 67% y-o-y so far this year amid the pandemic-induced slump in tourism, according to Colliers International’s MENA Hotels Quarterly review (pdf). Hurghada and Sharm El Sheikh’s occupancy rates have also fallen 57% and 55% year-to-date. Alexandria was the least affected of the Egyptian cities, but still saw occupancy rates falling 47% y-o-y. World Tourism Organization figures have shown that tourist arrivals to Egypt dropped 62.3% y-o-y in 1H2020 while tourism receipts plunged 90.4% in 2Q2020 when the sector was brought to a standstill after the government suspended international flights.

The restoration of flights hasn’t been a panacea: Weak occupancy rates continued into the third quarter despite airlines around the world resuming flights to Egypt. Alexandria and Sharm El Sheikh saw slightly better performance from 2Q, posting increases of 5% and 1% respectively, but remained significantly lower than the same quarter last year, Colliers said.

Uber has applied for an operating license under recent legislation governing ride-hailing companies, General Manger Ahmed Khalil said in an interview with Masrawy on Tuesday. Under the 2019 legislation, ride-hailing companies pay 25% more tax than other cab drivers, are obliged to hire white cab drivers, and must provide proof that their drivers are paying social insurance, amongst a host of other requirements on tariffs, data protection and service quality. Companies are required to pay EGP 30 mn for a five-year license, while drivers pay EGP 2k for a work permit.

LEGISLATION WATCH- Shipping agencies and customs brokers have won minor concessions from the Finance Ministry after challenging some elements of the recently-ratified Customs Act, Enterprise has learned. Brokers had complained about the strict new insurance requirements in the legislation, which force large companies to deposit EGP 100k and small companies EGP 50k, up from as little as EGP 5k before. The Customs Authority has refused to budge from the figures but according to a Finance Ministry directive obtained by Enterprise the authority will instead allow small firms to pay the amount in equal installments over five years.

Shipping companies will now be allowed to submit their cargo lists 24 hours before shipments arrive in the country, instead of the 48 hours written in the legislation to speed up clearance procedures. The new Customs Act was ratified earlier this month after receiving House approval in August.


The Central Bank of Egypt’s financial inclusion strategy seems to be moving forward after the bank yesterday set up a company to develop tech infrastructure and support digital payments, suggests a local press report. The central bank will hold a 99.9% stake in the Terra Digital Financial Infrastructure Company, and will work alongside the National Payments Council to upgrade the country’s digital infrastructure, the report says without providing further details. CBE Governor Tarek Amer said earlier this week that it is working on a new strategy to further financial inclusion, without providing details. It’s not clear how this will differ from the plan unveiled by the CBE in 2019, which centers on strengthening the bank’s regulatory and supervisory role, raising awareness on financial inclusion, and promoting fintech startups. Policymakers have been pushing financial inclusion for the past several years

MOVES- Global oil and gas company Neptune Energy has appointed Mohamed Mounes Shahat as managing director for Egypt, the company said. The industry veteran, who started his career as an engineer at state-owned Gulf of Suez Petroleum Company, will join Neptune’s Cairo office in December, succeeding Gamal Kassem.

Egypt in the News

That photo with Mohamed Ramadan and Israeli pop star Omer Adam isn’t going away: The singer is going to court for “causing offense to the Egyptian public,” with the first hearing scheduled for 19 December, after a photo of the two pop singers went viral, causing widespread outrage and leading to Ramadan’s suspension from the Egyptian Union of Artistic Syndicates. The press syndicate has also called for a boycott of Ramadan, calling on papers not to publish stories about, or images of him. The story is getting wide coverage from AP to the BBC and the Daily Mail.

Reuters reports on the public’s general disregard for adherence to covid-19 safety measures, despite the emergence of a second wave and harsher penalties for violators.

*** HOW HAS BLENDED LEARNING BEEN TREATING YOU SO FAR? Tell us what you think. We’ve put together a quick survey asking parents and students how things are going on the blended front. We’ll have the results in an upcoming issue of Blackboard. And as is our custom, we’ll draw the names of three respondents who will receive an Enterprise mug and a bag of our favourite coffee from our friends at 30 North.

Tap or click here to take the survey. It’s quick and painless, we promise.

Diplomacy + Foreign Trade

The only thing worth noting on the diplomacy/foreign trade front this morning: German development agency GIZ has approved a EUR 26 mn grant through state-owned development bank KfW to fund the second stage of Egypt’s national program for solid waste management, Environment Minister Yasmine Fouad said in a statement.

Worth Listening

We chart the career of Integrated Diagnostics Holdings CEO Hend El Sherbini and her journey turning a family-owned lab into a regional diagnostics giant with 450 facilities in Egypt, Sudan, Jordan and Nigeria, in this week’s episode of Making It. El Sherbini walks us through what it took to institutionalize her business and pave the way to becoming the first Egyptian company to list on the London Stock Exchange in 2015.

You already have a podcast player on your iPhone, or you can listen to the episode through our website (no download required). We’re also on Google Podcasts | Anghami | Omny. Making It is on Spotify, but only for non-MENA accounts.


How can SMEs get around expensive office space? Pt II – shared office spaces: SMEs have long struggled with rising office rental costs. Recently, this has pushed them to rely on residential units, putting them in breach of zoning regulations, we previously reported. This week, we look at how co-working and shared office spaces have grown since their first appearance in 2010. This developing market isn’t exactly budget, but it allows small businesses to be more flexible in establishing headquarters, generally with cheaper prices than commercial real estate.

The Greek Campus first pioneered the concept of shared office space in Egypt, Khaled Ismail, founder and chairman of angel investment fund KIAngel tells Enterprise. Over time, rental prices have risen and it’s now more akin to so-called smart villages catering to corporates like Microsoft and Uber than early-stage startups, he says. But it still focuses on providing a space for startups, argues Greek Campus community manager Muhammed Elamir: “We haven’t changed our target demographic or the mindset of the campus.” Of five standalone buildings, the pricing and design of two are specifically for startups, while the other three are for larger companies, he says. The Greek Campus currently provides startup space for minimum EGP 350/sqm. For businesses with 2-12 staff members, renting between 10-50 sqm would cost EGP 3.5k – 17.5k a month. By contrast, the least expensive listed commercial office space for rent in New Cairo ranges from EGP 17- 22k per month for offices of around 50 sqm.

Co-working and shared office companies have since flooded the capital and major cities, offering prime, clean, easily accessible locations with facilities. These include MQR, Makanak, The Hive, and Co Office. The trend has even attracted foreign investment, with international companies such as Regus picking up on SMEs’ need for shared office space.

Growth of an industry: Co-working spaces — where you pay a daily fee in exchange for workspace, either reserving in advance or as a walk-in — initially targeted individuals and freelancers, MQR co-founder Sherif Ashraf says. MQR first hosted small training sessions, private meetings, and spaces for freelancers. Co-working spaces remain popular, but many companies now focus on longer-term office rental agreements, generally renewed on a monthly or even quarterly basis. MQR has since rebranded, now offering office space to up-and-coming businesses, Ashraf says. Meanwhile, The Hive specifically targets mature businesses, corporates, multinationals, and well-funded startups, says general manager Seif Elkady. “We don’t really offer co-working or shared space, but private office space for rent.”

These companies provide businesses with a lower-cost alternative to commercial office spaces. Makanak offers a private office for one person starting at EGP 5.5-6k per month, while a five person office of 20-25 sqm starts at EGP 9k. MQR’s average prices for a 20 sqm office start at EGP 6k/month. But the exact prices and packages offered vary depending on location, time, number of team members, facilities, and other considerations, stress both Makanak’s founder, Moheb Zaki, and Ashraf. Co Office places itself a bit higher than the Greek Campus, charging EGP 4.5k/month for a small office for 1-2 people, EGP 9.9k/month for five people, and EGP 14.4k/month for 7-8 people.

You’re not just paying for space: Shared office spaces allow companies to forego paying for utilities and sometimes furniture as well. Additional services can include admin and secretarial work, company registration, catering, and access to conference rooms. There are also networking opportunities — particularly valuable for overseas companies, who won’t need to exert a lot of effort for insights into the Egyptian market, says Elamir.

Flexibility may be the biggest advantage: Clients value the model’s flexibility above all else, say sources. “We offer a professional environment, but with flexibility for different budgets,” says Zaki. Having the flexibility to expand or downsize, work in different locations, and access meeting rooms allows companies to focus on their work, says Elkady. “Flexibility and convenience are more in demand, as people see how productive the setting can be,” he adds.

The sector is expanding… Makanak now serves over 500 SMEs, with branches in central Cairo, the New Capital, Alexandria and Beni Sueif. Before covid-19, it planned to grow from 12 to 20 branches this year, says Zaki. In 2017, MQR began offering space in four locations across Cairo, and plans to open more branches in the near future, says Ashraf. The Greek Campus now manages and operates a startup hub in Saudi Arabia, and is constructing a new branch in the Mall of Arabia, which should be operational in early 2021, says Elamir.

… and creating new industries: The rapid growth of co-working spaces has spurred new startups that categorize, sort, and map Egypt’s co-working environment, such as Coworker and Hotdesk.

International and large Egyptian companies, and remote workers, see the benefits: German logistics company Impargo rents space at MQR for employees in Egypt, says Khaled Saqr, who leads expansion, so they can interact face-to-face in the office when needed or dispense with it for weeks without rent worries. Mohamed Hany convinced his Malaysian employers to let him work remotely, maximizing productivity while avoiding work from home distractions, he says. And Greek Campus clients include IT security company Trend Micro, Misr Capital Investment, Uber, Falak Accelerators, Mo4 Network, Udacity and Hawaya.

Many shared office spaces now have a mix of SMEs and more established companies: Greek Campus clients are now approximately 60% SMEs and 40% established businesses, with around 15% non-Egyptian businesses, says Elamir. Makanek clients include many multinationals, software engineers or developers, interior designers, and financial management consultants, with roughly 10% coming from overseas, says Zaki. The Hive has a mix of approximately 25% multinationals, 25% startups and 50% established Egyptian businesses, with around 25% of its total customer base being international, says Elkady.

So is shared office space the solution to soaring commercial office prices? For early and medium-stage companies, yes. Office spaces where SMEs can rent a private room and share facilities — based on long- or short-term agreements — seem to provide the best value for early-stage companies. The model offers SMEs a relatively affordable base, while they avoid the legal problems of basing their businesses in residential buildings.

NEXT WEEK: We look at how covid-19, and social distancing measures, have impacted this burgeoning sector that relies heavily on people going to an office.

Your top infrastructure stories for the week include:

  • Gov’t lifts six-month ban on construction: The government has decided against renewing its six-month construction ban but will not allow companies to resume construction until new requirements are issued in the first week of December.
  • Railway agreements: The Transport Ministry signed six railway agreements on the sidelines of the TransMea 2020 expo on Monday. Arab Contractors, Orascom Construction and Concord for Engineering and Contracting are also now part of the consortium of companies contracted to build the high-speed electric rail from Ain Sokhna to Alamein.
  • Telecom network upgrades: Etisalat and Orange will invest EGP 4-5 bn each on mobile network upgrade in 2021.
  • Nasr Utilities acquisition: Madinet Nasr for Housing and Development (MNHD) has signed a final agreement with an unnamed strategic investor for the sale of its 98.4% stake in subsidiary Nasr Utilities and Installations (NUI).
  • Break for small manufacturers: Small businesses will be given a six-month grace period before they have to pony up for leases on units in seven new industrial complexes recently proposed by the Industrial Development Authority.

The Market Yesterday

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EGP / USD CBE market average: Buy 15.59 | Sell 15.69
EGP / USD at CIB: Buy 15.59 | Sell 15.69
EGP / USD at NBE: Buy 15.59 | Sell 15.69

EGX30 (Tuesday): 10,997 (+1.0%)
Turnover: EGP 1.8 bn (59% above the 90-day average)
EGX 30 year-to-date: -21.2%

THE MARKET ON TUESDAY: The EGX30 ended Tuesday’s session up 1.0%. CIB, the index’s heaviest constituent, ended up 0.7%. EGX30’s top performing constituents were Orascom Investment Holding up 5.6%, TMG Holding up 4.8%, and Orascom Development Egypt up 4.6%. Yesterday’s worst performing stocks were Ibnsina Pharma down 1.5%, Pioneers Holding down 0.7% and Egypt Kuwait Holding down 0.6%. The market turnover was EGP 1.8 bn, and foreign investors were the sole net sellers.

Foreigners: Net short | EGP -27.2 mn
Regional: Net long | EGP +11.7 mn
Domestic: Net long | EGP +15.5 mn

Retail: 81.6% of total trades | 81.1% of buyers | 82.0% of sellers
Institutions: 18.4% of total trades | 18.9% of buyers | 18.0% of sellers

WTI: USD 45.46 (+1.22%)
Brent: USD 48.49 (+1.32%)

Natural Gas: (Nymex, futures prices) USD 2.77 MMBtu, (-0.32%, December 2020 contract)
Gold: USD 1,807.10 / troy ounce (-0.21%)

TASI: 8,636 (+0.29%) (YTD: +2.94%)
ADX: 4,947 (-0.54%) (YTD: -2.53%)
DFM: 2,399 (+1.92%) (YTD: -13.21%)
KSE Premier Market: 6,179 (+0.12%)
QE: 10,261 (-0.66%) (YTD: -1.58%)
MSM: 3,623 (-0.10%) (YTD: -8.98%)
BB: 1,460 (-0.01%) (YTD: -9.29%)

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November: Egypt will host simultaneously the International Capital Market Association’s emerging market, and Africa and Middle East meetings.

November: An Egyptian-Russian ministerial committee will meet to discuss trade and investment in Moscow.

19-28 November (Thursday-Sunday): Cairo International Film Festival, Cairo Opera House, Egypt.

22-25 November (Sunday-Wednesday): Cairo ICT 2020 and TransMEA 2020, Egypt International Exhibition Center, Nasr City, Cairo.

23-24 November (Monday-Tuesday): Runoffs for parliamentary elections in Giza, Fayoum, Beni Suef, Minya, Assiut, New Valley, Sohag, Qena, Luxor, Aswan, Red Sea, Alexandria, Beheira, Matrouh.

24-25 November (Tuesday-Wednesday): Canada-Arab Business Forum (virtual).

30 November (Monday): Final results will be announced for Parliamentary elections held in Giza, Fayoum, Beni Suef, Minya, Assiut, New Valley, Sohag, Qena, Luxor, Aswan, Red Sea, Alexandria, Beheira, Matrouh.

December (date TBC): Egypt Economic Summit, Cairo, Egypt, venue TBD.

December: Fifth round of Egypt-US Trade and Investment Framework Agreement (TIFA) talks.

December: A meeting to finalize membership and trading rules governing Egypt’s Commodities Exchange (Egycomex).

December: The 110th regular session of the Egyptian-Iraqi Joint Higher Committee will be held under the chairmanship of the prime ministers of the two countries.

1 December (Tuesday): The IMF will conduct a first review of targets set under the USD 5.2 bn standby loan approved in June (proposed date).

4 December (Friday): Cairo Art Fair kicks off and runs through 31 January 2021.

7 December: Former Civil Aviation Minister Ahmed Shafik faces trial over embezzlement allegations.

7-8 December (Monday-Tuesday): Runoffs for parliamentary elections in Cairo, Qalyubia, Menofia, Gharbia, Kafr El Sheikh, Sharqia, Damietta, Port Said, Ismailia, Suez, North Sinai and South Sinai.

9-10 December (Wednesday-Thursday): BiznEx, the international business expo in Egypt, Nile Ritz Carlton Hotel, Cairo, Egypt.

14 December (Monday): Final results will be announced for Parliamentary elections held in Cairo, Qalyubia, Menofia, Gharbia, Kafr El Sheikh, Sharqia, Damietta, Port Said, Ismailia, Suez, North Sinai and South Sinai.

15 December (Tuesday): House of Representatives reconvenes from recess.

15-16 December (Tuesday-Wednesday): US Federal Open Market Committee will hold its two-day policy meeting to review the interest rate.

24 December (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

25 December (Friday): Western Christmas.

31 December (Thursday): Egypt-UK post-Brexit trade agreement to take effect.

31 December (Thursday): Deadline for car owners to comply with traffic regulations to install a RFID electronic sticker on their cars.

1Q2021: The Seventh Annual Egypt Automotive Summit will be held

1H2021: Egypt’s Commodities Exchange (Egycomex) will begin trading.

1 January 2021 (Friday): New Year’s Day, national holiday.

7 January 2021 (Thursday): Coptic Christmas, national holiday.

13-31 January (Wednesday-Sunday): Egypt will host the 2021 Men’s Handball World Championship at the Giza Pyramids.

17 January 2021 (Sunday): A court will hold a postponed hearing to look into an appeal by Syria’s Anataradous against an arbitration ruling in favor of Amer Group and Amer Syria in case 445 of 2019.

25 January 2021 (Monday): 25 January revolution anniversary / Police Day.

25-29 January 2021 (Monday-Friday): The World Economic Forum’s “Davos Dialogues” will take place virtually.

26-28 January (Tuesday-Thursday): Future Investment Initiative, Riyadh, Saudi Arabia.

28 January 2021 (Thursday): National holiday in observance of 25 January revolution anniversary / Police Day.

4 February 2021 (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

6-18 February (Saturday-Thursday): Mid-year school break.

18 March 2021 (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

12 April 2021 (Monday): First day of Ramadan (TBC).

25 April 2021 (Sunday): Sinai Liberation Day.

29 April 2021 (Thursday): National holiday in observance of Sinai Liberation Day.

29 April 2021 (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

3 May 2021 (Monday): Sham El Nessim.

6 May 2021 (Thursday): National holiday in observance of Sham El Nessim.

12-15 May 2021 (Wednesday-Saturday): Eid El Fitr (TBC).

18-21 May 2021 (Tuesday-Friday): The World Economic Forum’s annual meeting will be held under the theme of “The Great Reset” in Lucerne-Bürgenstock, Switzerland

31 May-2 June 2021 (Monday-Wednesday): Egypt Petroleum Show, Egypt International Exhibition Center, Nasr City, Cairo.

30 May-15 June 2021 (Wednesday-Thursday): Cairo International Book Fair.

1 June 2021 (Tuesday): The IMF will conduct a second review of targets set under the USD 5.2 bn standby loan approved in June 2020 (proposed date).

10 June 2021 (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

24 June 2021 (Thursday): End of the 2020-2021 academic year.

26-29 June 2021 (Saturday-Tuesday): The Big 5 Construct Egypt, Cairo International Convention Center

30 June- 15 July 2021: National Book Fair.

22 July 2021 (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

30 July-3 August 2021 (Thursday-Monday): Eid Al Adha, national holiday (TBC).

1 October 2021-31 March 2022 (Friday-Thursday): Postponed Expo 2020 Dubai.

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