We’re going to have to get used to the idea that covid is here to stay

Good morning, friends, and welcome to a pleasantly brisk news morning to kick off what’s shaping up to be a gorgeous, sunny day.

THE BIG NEWS here at home? No single story from the world of business, public policy or foreign affairs is dominating the headlines, though you can expect the Israeli-Palestinian peace process to take over the news agenda later in the day as an Arab League summit gets underway. We have more below.

THE BIG NEWS AROUND THE WORLD is the growing acceptance that covid-19 is here to stay — that we are, after all, going to have to learn to “coexist” with it. That’s going to mean vaccinations for everyone; annual boosters; ongoing measures in the workplace, in restaurants and on planes; and a host of new ways of doing business. We have chapter and verse in the news well, below.

The case for (global market, and maybe economic) optimism this morning: “Asian shares hovered near record highs [this morning] while oil edged closer to USD 60 a barrel on hopes a USD 1.9 tn covid-19 aid package will be passed by US lawmakers as soon as this month just as coronavirus vaccines are being rolled out globally.” (Reuters)

*** We published the very first edition of EnterprisePM yesterday. It’s our quick catchup at 3:30pm CLT on the day’s news — and your guide to where to spend your time and money tonight. Yesterday’s headlines saw Speed Medical announce plans to acquire Six of October’s New Al Safwa Specialized Hospital in a EGP 185 mn transaction, and Tamweel Holdings unveil a EGP 500 mn securitized bond issuance planned for 2Q2021.

The 55th Super Bowl Sunday wrapped up on the other side of the Atlantic just a few minutes before we hit “send” on your morning read. The Tampa Bay Buccaneers bested defending champions the Kansas City Chiefs 31-9. If you’re a fan, you know where to get the post-game analysis. If you’re not a fan (but are a … gentleman of a certain age) you’ll still enjoy reading the epic Through genetics, luck or ‘prehab,’ Tom Brady endures at 43.

And for our readers in AgencyLand: CNBC and the WSJ’s CMO Today each have Youtube links to the ads that have played out on the air so far in what remains Madison Avenue’s biggest day of the year.

It’s the end of an era: Reagan administration secretary of state George Shultz, “a pillar of the Republican foreign-policy establishment whose diplomacy helped seal the end of the Cold War,” has died at age 100. The best obits so far: New York Times | Wall Street Journal | Financial Times.

Insead is back at the top of the Financial Times’ 2021 Global MBA ranking, dethroning Stanford, which — along with Harvard and Wharton — suspended its participation in data gathering due to the pandemic. London Business School, the University of Chicago: Booth, Iese Business School, and Yale School of Management round out the top five.

WHAT’S HAPPENING TODAY-

Egypt is heading up an emergency Arab League ministerial-level meeting today to discuss the Israel-Palestine peace process. The gathering comes after Foreign Minister Sameh Shoukry held high-level talks with French, German, EU and Jordanian officials in recent weeks, suggesting that there may be renewed political will to push the two sides back to the negotiating table. The International Criminal Court also ruled a few days ago that it can take legal action against Israel on Palestine’s behalf for war crimes committed against Palestinians since Israel’s establishment.

AUC is hosting a webinar headlined the Rise of Citizen Capitalism with guest speakers Michael O’Leary (Linkedin), MD at Engine No. 1, and Two Sigma partner Warren Valdmanis. It airs tonight at 7pm CLT and you can register for it here.

Former US president Donald Trump’s second impeachment trial begins in the Senate tomorrow, after House impeachment managers delivered last month the charges to the Senate. Trump is the first president in US history to be impeached twice.

CIRCLE YOUR CALENDAR-

PSA- Tomorrow is the last day for students in Egypt looking to get into private universities to upload their educational certificates on the Higher Education Ministry’s electronic university admissions site as part of the ministry’s new system.

Public schools began their mid-year break on Saturday and will be on holiday until Saturday, 20 February. Enjoy the slightly smoother commute for the next several days, folks.

The International Conference on Global Business, Economics, Finance and Social Sciences gets underway tomorrow at Ramses Hilton Cairo.

Egypt is hosting an arm of the World Conference on Science Engineering and Technology, which runs from Wednesday-Thursday at Luxor’s Hotel Pavillon Winter.

Inflation figures for January will be released on Wednesday, 10 February.

CORRECTION- We incorrectly stated yesterday that Sarwa Life Ins. and Misr Capital had launched a fixed income fund. The companies have set up a money market fund. The story has since been amended on our website.

*** It’s Blackboard day: We have our weekly look at the business of education in Egypt, from pre-K through the highest reaches of higher ed. Blackboard appears every Monday in Enterprise in the place of our traditional industry news roundups.

In today’s issue: Demand for private education is soaring in Egypt, with an estimated 2.1 mn new seats likely to be needed in K-12 private sector schools in Egypt by 2030 — almost 1 mn of which will be in Cairo, a Colliers International report tells us. We look at the tremendous horizons this opens for investors, and what’s needed to capitalize on it.

Trading of Orascom Investment Holding (OIH) shares on the EGX will be suspended this coming Thursday, 11 February, to allow the company to spin out assets including investment bank Beltone and non-bank financial services player Sarwa Capital into a new entity, Orascom Financial Holding. OIH confirmed the move in a regulatory filing yesterday (pdf). OIH’s global depositary receipts on the London Stock Exchange will stop trading at the same time.

EGX-listed Orascom Financial will give investors access to some of Egypt’s highest-profile financial services companies, including Sarwa and Beltone, as well as future ventures in the industry, insiders tell us.

OIH will continue to own its Pyramids plateau venture as well as legacy assets including a mobile network in North Korea. OIH will retain investments in some nine subsidiaries and sister companies when all is said and done. OIH first announced the split last July. OIH will remain listed on the EGX with an authorized capital of EGP 2.5 bn, according to a separate filing (pdf).

The demerger is expected to be complete by the end of the month, Onsi Naguib Sawiris — who is set to play a leading role in OFH — told us yesterday.

What’s next? Once the horizontal demerger is complete, OIH will lower its capital and resume trading — after receiving regulatory approval — while the spun-off OFH will see its shares traded separately.

We’re going to have to get used to living with covid for many, many years to come — but that doesn’t necessarily mean a lifetime of lockdown measures, the Wall Street Journal writes this morning in one of the smartest pieces about the pandemic that we’ve read in ages.

The bottom line: “The pathogen will circulate for years, or even decades, leaving society to coexist with Covid-19 much as it does with other endemic diseases like flu, measles, and HIV.”

We need to get to the acceptance stage sooner rather than later, suggests a former director of the US Centers for Disease Control: “Going through the five phases of grief, we need to come to the acceptance phase that our lives are not going to be the same. I don’t think the world has really absorbed the fact that these are long-term changes.”

It’s not all doom and gloom: Vaccines and masking are key to being able to go about our daily lives in a more normal way. Look at Israel: The vaccine has proven “so effective at preventing severe disease and slashing hospitalizations and deaths [that] hospitalizations have already fallen 30% in Israel after it vaccinated a third of its population. Deaths there are expected to plummet in weeks ahead.”

You can expect to have to take an annual booster and maybe even an annual jab on top of that: A “booster in the autumn,” followed by annual vaccination could help fight new strains of the virus in the years ahead, UK’s vaccine minister Nadhim Zahawi told the BBC.

Why? We’ve already found that the Oxford / AstraZeneca jab is ineffective against the South African strain of covid, sending researchers back to the drawing board for a new shot, BBC reports.

Meanwhile: Dubai has got it right: It’s pledging to vaccinate all eligible adults against covid-19 this year, Amer Sharif, head of the emirate’s covid-19 command and control center, told Bloomberg TV. Also in the UAE: Abu Dhabi reimposed yesterday sweeping restrictions amid a resurgence of the virus. Gatherings have been banned, cinemas shut, and strict new capacity limits have been introduced on public transportation and non-essential services.

HERE AT HOME: The Health Ministry reported 534 new covid-19 infections yesterday, up from 509 the day before. The ministry also reported 47 new deaths, bringing the country’s total death toll to 9,651. Egypt has now disclosed a total of 169,640 confirmed cases of covid-19.

Egypt’s tourism sector could be three years away from mounting a full recovery, according to Elhamy El Zayat, former chairman of the Egyptian Tourism Federation, who told the local press that we’re unlikely to see pre-pandemic levels of tourism before 2024. Lingering concerns over the pandemic will mean that people remain sceptical of international travel for another few years, despite the acceleration of the global vaccine rollout, he said.

Let’s hope he’s wrong: The country’s tourism sector experienced one of its worst years in living memory last year, as disruptions to international travel and worries about the pandemic caused revenues to nosedive more than 75% to just USD 4 bn. Some 3.6 mn tourists visited Egypt, down from 13 mn the year before, sending hotel occupancy in four of Egypt’s biggest tourist destinations down 60% — and seeing the country to lose out on some USD 14 bn in foreign currency revenue in the process.

Infinity Solar subsidiary Infinity-E will install 300 electric car charging docks across Egypt by 2023 as part of an ongoing plan to invest EGP 300 mn in EV infrastructure, CEO Shams El Din Abdel Ghaffar said, according to Masrawy. Infinity now has a total of 150 charging points in operation at 40 charging locations on major roads in or near Cairo, Hurghada, Alexandria and Ain Sokhna. The government has recently been pushing for a transition to EVs with incentives including set charging prices and subsidies of up to 50k per vehicle, while also moving along with plans to set up 3k charging stations within three years. Last month, state-owned El Nasr Automotive signed two contracts with China’s Dongfeng to locally assemble the vehicles here.

OTHER AUTOMOTIVE NEWS-

Suzuki’s local agent Modern Motors and BYD local assembler Al Amal Group are rolling out natural gas-powered vehicles for the government’s natgas transition plan, both companies’ chairmans said, according to Hapi Journal (here and here). Modern Motors will supply a seven-seater natgas Suzuki microbus, and is in talks to also provide a natgas model of passenger cars. Al Amal, meanwhile, will locally assemble natgas models of its BYD F3 and Lada Granta passenger cars, and King Long microbuses.

The government’s natural gas transition plan kicked into gear earlier this year. The Central Bank of Egypt launched a multi-bn EGP program then to support the plan, which aims to take some 250k old cars off the road and outfit with dual-fuel engines by the end of 2023 as a first phase, as well as build a network of natural gas filling stations.

That tax on fun is back on the menu: Amendments to the tax code that would raise taxes on cinemas, nightclubs, theaters, and wedding venues are on the Finance Ministry’s to-do list in the coming period, Minister Mohamed Maait told the House Planning and Budgeting Committee on Sunday, Al Masry Al Youm reports. The amendments were less than popular with the business community when first proposed back in 2018.

Other bills on the House Budget committee’s agenda: Amendments to the Stamp Tax Act, as well as amendments to the Real Estate Tax Act, which could include exemptions for factories and businesses. Maait did not specify whether there are new changes in the works on the Stamp Tax Act after recent amendments that lower the tax on EGX transactions and the withholding tax on dividends were signed into law last year.

OTHER LEGISLATION NEWS-

The new Customs Act will no longer require shippers to submit waybills before leaving Egypt under new guidelines issued by the Customs Authority yesterday. Cargo ships, planes, and other vehicles will instead have the option of handing over the documentation 48 hours after leaving the country. The guidelines apply to vessels with or without cargo, and shippers who fail to submit waybills within the 48-hour period may be fined, El Shahat Ghatwary, who heads central administration at the Customs Authority, told Enterprise.

The guidelines will become part of the recently-ratified act and will be worked into the law’s executive regulations, which are currently under consultations with the shipping community, Ghatwary said. The changes were made after exporters, shipping agencies, and customs brokers all pushed back against various aspects of the law, leading to minor concessions from the Finance Ministry.

About the law: Ratified in October, the law aims to expedite clearance by introducing rules that simplify the passage of “transit goods” between ports in Egypt or to ports abroad and creating green channels for trusted companies, among other stipulations. It’s part of a larger drive to streamline customs procedures which also includes the soon-to-be launched National Single Window for Foreign Trade Facilitation (Nafeza) that creates pre-registration protocols at seaports.

Want a building permit? You’ll need to hook your property up to fiber. Fiber optic connectivity will be one of the public utilities required for new construction permits as of April — and will be treated like all other required utilities, CIT Minister Amr Talaat said in his policy address to the House of Representatives yesterday, according to Al Mal. The minister did not explicitly say whether this requirement will be included in the new building code, and the Unified Building Code (pdf) passed last year only lists drinking water and sanitation infrastructure, electricity, and a road network as the “basic public utilities” required for a building. However, the new building code is expected to be expansive and should see the light in the near future, suggesting that CIT infrastructure requirements could be included in the new regulations.

The inclusion would also make sense as the Sisi administration pushes ahead with its digitization strategy, which includes work from the CIT Ministry to upgrade and develop Egypt’s network infrastructure, Talaat told Enterprise back in 2018. Vodafone Egypt and state-owned Telecom Egypt have previously announced plans to invest in fiber optic infrastructure.

Egyptian real estate marketplace Sakneen has raised USD 1.1 mn in an oversubscribed seed funding round led by Algebra Ventures, with “major participation” from Sarwa Capital and Foundation Ventures, according to a statement (pdf). The round also saw participation from US-based real estate private equity firm Hem+Spire, Saudi-based Nakhla VC, as well as angel investors with pedigrees that include Google and BlackRock. Sakneen provides a search engine with “detailed search abilities like allowing users to search by down payment, monthly payment, and unique data points like NPV and travel times,” CEO and co-founder Ramy Khorshed said.

Where the investment is going: Sakneen plans to use the funding primarily on its products and technology, and to retain the talent the company has on board, Khorshed told Enterprise. The company is currently “actively working on several new features” it plans to roll out within the next few weeks, and is looking to launch “completely new products” in the near future, CTO and co-founder Hussein El Kheshen said.

Shares of dairy foods giant Juhayna plunged as much as 17% in trading yesterday before regaining some ground to close the day down 10.6% on news of CEO Seif Thabet’s arrest on Saturday as part of what Reuters says is an investigation into the alleged financing of terror groups. Seif’s father Safwan Thabet was arrested late last year as part of a probe into what security officials described as “financial irregularities.” The company confirmed Seif’s detention in an EGX disclosure (pdf) Sunday, saying it had no further information to disclose.

Hossam Abousati has been appointed CEO of the General Authority for Healthcare Accreditation and Regulation, Al Masry Al Youm reports. Abousati had previously served as a political communications assistant to the health minister.

Informal housing and development dominated the airwaves again last night as the talking heads delved into President Abdel Fattah El Sisi’s visit to the Ezbet El Haggana area along with a number of ministers. Masaa DMC’s Eman El Hosary (watch, runtime: 15:43) and Ala Mas’ouleety’s Ahmed Moussa covered the tour (watch, runtime: 4:55).

Plans to renovate with minimal displacement: The government’s plan to develop Ezbet El Haggana as part of its development strategy for informal settlements will see repairs to its electricity and sewage networks complete within the coming month, Kelma Akhira’s Lamees El Hadidi noted (watch, runtime: 2:51). The development plan also entails expanding the roads in the area, but authorities will aim to minimize the number of buildings that will be removed in the process, head of the Informal Housing Fund Khaled Seddik told El Hosary (watch, runtime: 5:50). Seddik had a similar chat with Al Hayah Al Youm's Lobna Assal (watch, runtime: 11:13).

The second biggest talking point of the night: The imminent launch of Egycomex and other internal trade developments. Ibrahim Ashmawy, head of the Internal Trade Development Authority and chairman of the new Egyptian Commodities Exchange (Egycomex) explained the benefits of the exchange in regulating and digitizing commodities trading in a sit-down with Al Hayah Al Youm’s Assal. With its financial and administrative regulations now complete, the exchange will launch on a pilot basis in mid-April, with wheat as the first tradable commodity, Ashmawy confirmed (watch, runtime: 10:52).

The government’s plans to establish logistics zones in different governorates are meant to help reduce the prices of goods, Ashmawy said in a separate interview with Ala Mas’ouleety’s Ahmed Moussa (watch, runtime: 5:43). Ashmawy also touched on the planned EGP 20 bn Gold City, which will depend on the private sector for financing and partnership (watch, runtime: 4:29).

Just like the domestic press, the foreign press is taking a breather this morning. The only story of note out there is the Associated Press picking up on President Abdel Fattah El Sisi giving his blessings to Libya’s newly appointed interim government in his phone-in to El Hekaya on Saturday night.

Edita has added an EGP 106 mn assembly line for its wafer products, the EGX-listed snackfood maker said in a regulatory filing (pdf). The new line can produce up to 6.4k tonnes of product a year, and will be used to produce Freska Block, Edita’s latest addition to its wafer segment.

Other things we’re keeping an eye on this morning:

• Credit Agricole Egypt has launched (pdf) an eco-friendly range of bank cards made of bioplastic.
• Governorate-level strategies to develop SMEs and encourage informal businesses to go legit are on the radar of the House SMEs Committee.
• The General Authority for Freezones and Investment will develop bilateral investment and trade with Kazakhstan under an MoU signed with state company Kazakh Invest.

A HANDFUL OF REGIONAL DIPLOMACY STORIES:

Egypt resumes “infrastructure diplomacy” with Iraq: The “oil-for-reconstruction” mechanism agreed by Egypt and Iraq last year was the subject of talks between International Cooperation Minister Rania Al Mashat and a delegation of Iraqi officials last week, the ministry said in a statement, which offered no further details. The two sides signed 15 MoUs in November which could see Egyptian companies awarded infrastructure projects in Iraq in return for Iraqi oil.

The talks came as Egypt’s new ambassador to Iraq, Walid Ismail, presented his credentials to the Iraqi Foreign Ministry on Saturday. Ismail was appointed the new ambassador in July.

Foreign Minister Sameh Shoukry reiterated Egypt’s support for a diplomatic solution to the Yemeni crisis in a meeting with newly appointed Yemeni Foreign Minister Ahmed Awad BinMubarak yesterday, according to a cabinet statement.

Making headlines internationally: Tens of thousands of protesters have taken to the streets of Myanmar after last Monday’s military takeover, calling for the release of elected leader Aung San Suu Kyi. Some 1k people joined a protest in Naypyidaw and 60k in Yangon, while more protests were reported in other areas of the country. The story is everywhere in the global press from Reuters and the Associated Press to the Financial Times.

February: France’s finance minister, Bruno Le Maire, is set to visit Egypt.

6-8 February (Saturday- Monday) Students will be able to upload their educational certificates on the Higher Education Ministry’s electronic university admissions site.

6-20 February (Saturday-Saturday): Mid-year school break (public schools — enjoy the break from bumper-to-bumper traffic).

7-28 February (Sunday-Sunday): The Finance Ministry will receive applications from companies wishing to take part in the second phase of its program for the immediate payout of export subsidy arrears to exporters, minus a 15% fee.

8 February (Monday): Egypt leads an emergency Arab League minister-level meeting on the Israel-Palestine peace process.

8 February (Monday): AUC will hold a webinar titled ‘The Rise of Citizen Capitalism’ featuring Michael O'Leary, the managing director of Engine No. 1, and Warren Valdmanis, a partner at Two Sigma.

9 February (Tuesday): International Conference on Global Business, Economics, Finance and Social Sciences, Ramses Hilton, Cairo, Egypt.

10-11 February (Wednesday-Thursday): Egypt will host an arm of the World Conference on Science Engineering and Technology, Hotel Pavillon Winter, Luxor, Egypt.

12 February (Friday): Deadline to reach a settlement with the Tax Authority on overdue income, value-added, or real estate taxes without all the late fees. Late taxpayers are still eligible for a 50% exemption on interest fees and late penalties until 12 February under a bill passed last year, Tax Authority boss Reda Abdel Kader said.

12-15 February (Friday-Monday): Students will be able to apply for placement at private universities on the Higher Education Ministry’s electronic university admissions site

20 February (Saturday): Final results of applications for private university places will be announced on the Higher Education Ministry’s electronic university admissions site

22-24 February (Monday-Wednesday): Second Arab Land Conference on land management, efficient land use, among other topics.

22 February- 5 March (Monday-Friday) Egypt will host the World Shooting Championship in 6 October’s Shooting Club, with 31 countries set to participate

26 February (Thursday): The Afro Future Summit will take place virtually.

28 February (Sunday) Deadline for businesses, sole traders, and those generating income from sources other than their day job to file wage tax returns through the electronic filing system.

March: Potential visit to Cairo by Russian President Vladimir Putin.

1-5 March (Sunday-Friday): Aswan Forum for Peace and Development will take place virtually.

4-6 March (Thursday-Saturday): Cairo Fashion & Tex trade show, Cairo International Convention Centre, Cairo, Egypt

8 March (Monday): The IDC Future of Work Egypt conference will be held virtually featuring experts from Egypt and Jordan.

9-11 March (Tuesday-Thursday): EduGate 2021 – Enter The Future conference, Kempinski Royal Maxim Hotel, Cairo, Egypt.

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

1-3 April (Thursday-Saturday): HVAC-R Egypt Expo.

8-10 April (Thursday-Saturday): The TriFactory’s Endurance Festival at Somabay.

13 April (Monday): First day of Ramadan (TBC).

25 April (Sunday): Sinai Liberation Day.

29 April (Thursday): National holiday in observance of Sinai Liberation Day (TBC),

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

1 May (Saturday): Labor Day (national holiday).

2 May (Sunday): Easter Sunday.

3 May (Monday): Sham El Nessim.

13-15 May (Thursday-Saturday): Eid El Fitr (TBC).

25-28 May (Tuesday-Friday): The World Economic Forum annual meeting, Singapore.

31 May-2 June (Monday-Wednesday): Egypt Petroleum Show, Egypt International Exhibition Center, New Cairo, Egypt,

1 June (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).

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

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

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

30 June (Wednesday): 30 June Revolution Day.

1 July: (Thursday): National holiday in observance of 30 June Revolution.

30 June- 15 July: National Book Fair.

1 July (Thursday): Large taxpayers that have not yet signed on on to the e-invoicing platform will suffer a host of penalties, including removal from large taxpayer classification, losing access to government services and business, and losing subsidies.

19 July (Monday): Arafat Day (national holiday).

20-23 July (Tuesday-Friday): Eid Al Adha (national holiday)

23 July (Friday): Revolution Day (national holiday).

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

9 August (Monday): Islamic New Year.

12 August (Thursday): National holiday in observance of the Islamic New Year.

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

30 September-2 October (Thursday-Saturday): Egypt Projects 2021 expo, Egypt International Exhibition Center, Cairo, Egypt.

1 October (Friday): Expo 2020 Dubai opens.

6 October (Wednesday): Armed Forces Day.

7 October (Thursday): National holiday in observance of Armed Forces Day.

18 October (Monday): Prophet’s Birthday.

21 October (Thursday): National holiday in observance of the Prophet’s Birthday.

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

13-17 December: United Nations Convention against Corruption, Sharm El Sheikh, Egypt.

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

27 June – 3 July 2022 (Monday-Sunday): World University Squash Championships, New Giza.

Note to readers: Some national holidays may appear twice above. Since 2020, Egypt has observed most mid-week holidays on Thursdays regardless of the day on which they fall and may also move those days to Sundays. We distinguish below between the actual holiday and its observance.