Tuesday, 22 June 2021

Tawasol, LimeVest make their move for Alex Medical

TL;DR

WHAT WE’RE TRACKING TODAY

Good morning, everyone, and welcome to a typical “2021” news day led by stories on covid vaccines as well as M&A in healthcare and non-bank financial services. Not “2021 enough” for you? We also have talk about Ethiopia and GERD, rail accidents, privatization and the global commodities boom. Does it get any more “2021” than that?

WHAT’S HAPPENING TODAY-

Irrigation Minister Mohamed Abdel Aty is on a four-day visit to South Sudan that kicked off yesterday with talks with the country’s foreign minister, the ministry said in a statement. The two discussed the dispute over the Grand Ethiopian Renaissance Dam (GERD) and a joint higher committee meeting set to take place in Cairo next month. Also on the agenda: Aty will meet his Sudanese counterpart Manawa Peter to discuss joint water initiatives, before visiting several projects that Egypt is involved in.

GERD diplomacy? The irrigation minister’s visit to the upstream Nile country comes as Egypt tries to get other countries on side to support its position in the dispute over the GERD. In past weeks, Egypt has strengthened military ties with several states, signing defense agreements with Sudan, Kenya, Uganda and Burundi, while President Abdel Fattah El Sisi visited Djibouti for talks with the country’s president.

It’s day one of the 2020-2021 CIB PSA World Tour Finals. Today, world no.1 Ali Farag faces defending champion Marwan El Shorbagy, while women’s no.1 Nour El Sherbini plays France’s Camille Serme and last year’s quarter-finalist Nouran Gohar faces fellow Egyptian Salma Hany. The tournament will run through Saturday, 27 June.

***CATCH UP QUICK with the top stories from yesterday’s edition of EnterprisePM:

  • Tuk-tuk owners can apply to swap their vehicles for natgas microbuses next month: Tuk-tuks can now take part in the natgas vehicle swap scheme and will receive financial support and reduced interest rates, while cabinet is also expected to recommend reducing the cost of tuk-tuk licensing.
  • EFG, TMG, GB Capital mortgage arm Bedaya plans securitization before 2021 is out: Mortgage provider Bedaya is planning to sell securitized bonds backed by its receivables before the end of the year to finance new branches.
  • Egyptian digital trucking platform Trella has closed a USD 42 mn funding round co-led by Maersk Growth: The financing includes USD 30 mn new equity and USD 12 mn in debt, which will likely go towards the company’s plans to scale its operations in the MENA + Pakistan region.

HAPPENING SOUTH OF THE BORDER-

Ethiopians are going to the polls as Prime Minister Abiy Ahmed stands for reelection. The country’s first multiparty elections in 16 years have faced major hurdles, with an ongoing ethnic conflict in the Tigray region, opposition boycotts, and logistical difficulties. Though voters went to the polls across much of the country yesterday, four of Ethiopia’s 10 regions were unable to open voting booths, and in two that did, the country’s election authority reported intimidation of election observers. Abiy, who is expected to win, tweeted ahead of the vote that it would be Ethiopia’s “first attempt at free and fair elections.” The Associated Press and Reuters have the story.

It’s a mixed picture in the global front pages this morning, with no single story getting widely picked up:

  • The market yesterday: CNBC and the Wall Street Journal are focusing on the strong — and slightly unexpected — gains in US shares yesterday (more on that below).
  • Covid in the US of A: We have competing visions of the state of the US’ covid epidemic, with Bloomberg warning of the spread of the delta variant and the Associated Press more optimistically running with the low death rates, which have fallen below 300 per day for the first time since March 2020.

MARKET WATCH- Yesterday wasn’t quite as rocky as we thought it would be: US stocks saw their biggest daily gains in five weeks yesterday as concerns about a less dovish stance at the Federal Reserve abated, Bloomberg says. The S&P 500 gained 1.4% during the day, led by energy, financial and industrial shares, while the Dow climbed 1.8% and the Nasdaq finished 0.6% up. The gains came despite volatility in Asian markets earlier in the day, which saw the Nikkei lose some 3.5%.

Stocks in Europe and the US saw heavy losses last week on the back of the Federal Reserve’s policy meeting, after which it suggested it could raise interest rates in 2023 — a year earlier than investors had anticipated.

Don’t be surprised if there’s more volatility ahead: Former Treasury Secretary Lawrence Summers and bn’aire hedge fund investor Ray Dalio have warned that rising inflation and an overheating economy could upend the recovery and send jolts through financial markets, Bloomberg reports. Speaking at the Qatar Economic Forum yesterday, Dalio said that record high valuations mean that market and economy alike will be “very sensitive” to attempts by the Fed to roll back its ultra-loose policy. “Just the slightest touching on those brakes has the effect of hurting markets because of where they’re priced, and also passing through to the economy,” he said.

HOW THINGS LOOK TODAY: Asian markets are rebounding strongly from yesterday’s losses while futures point to European and US shares building on gains when markets open later today.


SIGN OF THE TIMES- Solar falls victim to inflation pressures: After the industry has tried (and succeeded) for decades in bringing the cost of solar down, the global commodities boom could throw a wrench at the whole endeavor. Citigroup analysts are penciling in an increase of 12% in the cost of new solar installations this year on the back of fast-increasing steel and polysilicon prices and higher freight costs, the Financial Times reports, citing data and analyst forecasts. Hot-dipped galvanised steel coils and monocrystalline silicon cells rose, two key components used in making panels. Galvanized steel coil prices doubled since early 2020, while silicon cell prices rose 25%, data from S&P Platts and BloombergNEF showed.

Sound smart: The cost of solar energy fell some 80% between 2010 and 2020 as rising demand and advances in technology together drove down the cost of infrastructure.

SIGN OF THE TIMES #2- Your laptops and tablets are going to get more expensive: It appears that consumer electronics manufacturers have begun passing the increased costs from the global chip shortage down to the consumer, with Dell, HP, Asus, and Amazon reporting price increases on their upcoming models between 6-20%, according to a Wall Street Journal piece citing industry executives. These run the gamut of smartphones, tablets, all the way to printers. This comes as the prices of components have risen between 15-40%.

CIRCLE YOUR CALENDAR-

The African Development Bank’s annual meeting takes place this week (virtually, of course), running 23-25 June.

It’s the last day of the academic year for public school students this week, who will attend their last day on Thursday, 24 June.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

enterprise

*** It’s Going Green day — your weekly briefing of all things green in Egypt: Enterprise’s green economy vertical focuses each Tuesday on the business of renewable energy and sustainable practices in Egypt, everything from solar and wind energy through to water, waste management, sustainable building practices and how you can make your business greener, whatever the sector.

In today’s issue: In this multi-part series, we’ve looked at how construction materials are among Egypt’s biggest sources of pollution, though some companies are making efforts to reduce their environmental impact. In part four, we look at how alternatives to traditional construction materials are being used in Egypt. We’ve found that both natural and industrially-produced materials are being used in highly innovative ways — mainly by rapidly growing startups — but that their overall market share remains low.

enterprise

M&A WATCH

Tawasol, LimeVest make their move for Alex Medical

Tawasol-LimeVest consortium launches Alex Medical takeover bid: A consortium of Tawasol Holdings and LimeVest affiliate Maternity and Pediatrics Holding has made its move in the race for Alexandria Medical Services, submitting a bid that values the company at more than EGP 740 mn. The companies have submitted a request to go ahead with a mandatory tender offer (MTO) to acquire a 74.08% stake in the company at EGP 52 per share, the Financial Regulatory Authority said (pdf) yesterday. Tawasol is already a 26% shareholder in Alex Medical, and the acquisition would give the consortium 100% ownership. Abu Dhabi Commercial Bank is the main seller, and is looking to exit its 51.5% stake.

This is higher than the bid submitted by Tana Africa’s TAT Medical Services, which bid for Alex Medical at EGP 49.04 per share earlier this month, up from the EGP 45.53 it had offered in May. This came a few days after Yas Holding, the parent company of the UAE’s Global One Healthcare Holding, offered EGP 47.98 per share for at least 51% of the company. Other bidders include Cleopatra Hospital (it’s offering EGP 38.53 per share), Nile Scan and healthcare investment firm Seha Capital.

Speed Medical withdrew in May from the Tawasol-LimeVest consortium, which had previously offered EGP 38.09 per share last April for 100% of Alex Medical.

IN OTHER M&A NEWS-

The price war for that other hot Alex company is heating up: Hong Kong’s Zeta Investments has raised its MTO for 90% of Alexandria National Company for Financial Investments (ANFI), to EGP 6 apiece, up from the EGP 5.48 per share it submitted in mid-June, according to a statement (pdf) by the Financial Regulatory Authority. The new offer values ANFI at EGP 31.35 mn. Subscription period for Zeta's MTO ends on Monday, 28 June. The offer was launched last week after obtaining the FRA’s approval.

The bids keep rolling in: The revised offer comes one day after private equity firm Compass Capital has submitted an MTO to acquire up to 100% of ANFI for EGP 5.72 per share. Tycoon Holding wants to acquire a 90% stake for EGP 5.60 per share.

COVID WATCH

The US is donating more vaccines to Egypt

Egypt will receive a share of 14 mn vaccines allocated by the US to at least 30 other “regional priority” countries, the White House said yesterday without giving a more detailed breakdown.

This is part of a second, 55 mn-dose tranche of vaccines to be handed out by the US under the Biden administration’s pledge to distribute 80 mn shots around the world. The first batch, announced earlier this month, will see 6 mn doses divided between Egypt and 13 other countries. It remains unclear how many of the the shots will be allocated to each nation.

When could we receive these jabs? It’s likely to be a longer process than first thought: Having originally pledged to send the 80 mn doses by the end of June, the White House is now saying that it will “allocate” them by the end of the month, suggesting shipments will stretch into July or beyond.

The Health Ministry reported 509 new covid-19 infections yesterday, down from 532 the day before. Egypt has now disclosed a total of 277,797 confirmed cases of covid-19. The ministry also reported 39 new deaths, bringing the country’s total death toll to 15,898.

Africa’s vaccine rollout could get a shot in the arm with a new mRNA vaccine production facility the World Health Organization (WHO) is planning to set up in South Africa.

The WHO plans to establish the new “technology transfer hub” — deemed the first of its kind in Africa — alongside a South African-French consortium, it said in a statement yesterday. Production of mRNA-based vaccines, such as the jabs developed by BioNTech / Pfizer and Moderna, could start when the plant is up and running in 9-12 months’ time, WHO boss Tedros Ghebreyesus told a news conference yesterday, Reuters reported.

PRIVATIZATION WATCH

Private sector could bid for some of Egyptian Iron and Steel’s land bank

Private sector companies will have the chance to bid for some of Egyptian Iron and Steel’s land bank as the government continues the process of liquidating the state-owned company, Deputy Housing Minister Khaled Abbas tells Al Mal. The New Urban Communities Authority has been put in charge of preparing the sale, a process which is expected to take 2-3 months, he said.

How much land is potentially up for grabs? Egyptian Iron and Steel owns 6 mn sqm of land. We’ll likely find out how much of this will be auctioned off to private sector firms after NUCA has finished doing its thing later in 3Q.

This comes as part of Iron and Steel’s ongoing liquidation — a process expected to take up to two years that will see the perennial lossmaker sell its land assets to pay off EGP 9 bn in debts. Egyptian Iron and Steel officially halted its operations in late May until a compensation agreement is reached with employees.

The process has so far given us the newest entrant to the EGX: Iron and Steel’s mining operations have been spun off to form a new company, Iron and Steel for Mines and Quarries, whose c.978 mn shares began trading on the EGX at the end of May.

TRADE

Of Export subsidies and Africa…

The Export Subsidy Fund has paid out EGP 4.3 bn in arrears to exporters as part of the second stage of the subsidy program, which ran through February, Trade Minister Nevine Gamea said in a statement yesterday. The fund has paid out some EGP 27 bn in arrears since the launch of the program last year, which allowed companies to receive overdue subsidies in bulk instead of in installments over several years, provided that they agree to take a 15% haircut.

The new incarnation of the subsidy program will launch in July: As of FY2021-2022, exporters in the automotive, ceramics, pharma, electronics, and chemicals industries will be eligible to sign up to the program for the first time, the ministry said last week. The program will feature specific incentives to trade with other African countries, and will run for three years for most sectors except the auto industry, which will continue to receive support until 2028.

Egypt has weak trading links with Africa: Africa accounted for just 1% of Egypt’s total trade in FY2019-2020, according to government data.

The new African trade zone is hoped to boost continental trade by lowering tariff and non-tariff barriers to trade and strengthening regional supply chains. Egypt ratified the agreement in 2019 and began trading under its terms at the beginning of 2021.

The Egyptian Businessmen Association (EBA) is also eyeing up Africa: The industry association is considering establishing a consortium to compete for infrastructure and grand reconstruction projects in Africa, Deputy board Chairman Fathallah Fawzi said during an EBA webinar, Hapi Journal reports. The consortium would include construction, contracting and consulting firms, as well as government entities, and would further Egypt’s goals to deepen trade ties with other African markets. Egypt had also been mulling joining a USD 1 bn continental transit [assurance] scheme to encourage trade across Africa.

EBA members also took part in a two-day ICT sector networking event for African and European companies ending today — according to Masrawy — in a meeting that aims to provide a gateway to new markets for companies operating in Egypt and Africa.

enterprise

ENTERPRISE+: LAST NIGHT’S TALK SHOWS

Last night’s train crash in Helwan led the talk shows: At least two people were killed and six others injured after a freight train collided with two microbuses overnight in Helwan, the Health Ministry said in a statement. One of the microbuses appears to have parked “too close” to the rail line near a high-density town when the train smashed into it and grazed the other vehicle, the Railway Authority said. The Public Prosecution has ordered an investigation into the causes of the crash.

Transport Minister Kamel El Wazir dropped into El Hekaya to explain the events and blamed illegal construction encroaching on rail lines for contributing to the accident (watch, runtime: 2:23). President Abdel Fattah El Sisi has ordered the removal of all illegal buildings along rail lines across the country and told officials to compensate residents, he said (watch, runtime: 1:08). Ala Mas’ouleety (watch, runtime: 33:52 | 39:21), Masaa DMC (watch, runtime: 1:27) and Al Qahera Wel Nas (watch, runtime: 2:10) also had coverage.

2021 hasn’t been good to Egypt’s railways: Yesterday’s collision makes even clearer the problems faced by Egypt’s railways, which earlier this year witnessed four fatal accidents in the space of a month.

Elsewhere, politics got a look-in: Greek Prime Minister Kyriakos Mitsotakis was in Cairo for talks with President Abdel Fattah El Sisi and Prime Minister Moustafa Madbouly, his joint press conference with El Sisi got the attention of most of the nation’s talking heads. The presser saw both sides agreeing to push ahead plans for linking our electricity grid to that of Greece and Cyprus. There are ongoing studies for ways to expand the interconnection project’s capacity to generate up to 600 MW of electricity, and negotiations are underway for an agreement between the two countries in the near future, Electricity Ministry spokesman Ayman Hamza said in a phone-in to Ala Mas’ouleety (watch, runtime: 32:40) last night. El Hekaya (watch, runtime: 10:10), Al Hayah Al Youm (watch, runtime: 4:01) and Masaa DMC (watch, runtime: 4:07) also covered the presser.

It wouldn’t be a night of Egyptian talk shows with GERD getting a mention: The EU’s special representative for Sudan, Pekka Haavisto, issued a statement yesterday calling on Ethiopia to re-negotiate with Egypt and Sudan on the filling and operation of the Grand Ethiopian Renaissance Dam, and at least reach an interim settlement agreement before the rainy season begins in a few weeks. Haavisto’s statement shows that the EU, along with the African Union and UN, back Cairo and Khartoum’s position in the dispute and will not allow harm to befall them, former Assistant Foreign Minister Mohamed Hegazy told Al Hayah Al Youm (watch, runtime: 7:04).

EGYPT IN THE NEWS

Human rights are capturing the attention of the foreign press again this morning: In a podcast, the Guardian speaks to Egyptian human rights worker Karim Ennarah about his experiences when he was arrested by authorities last year, while Italy’s Ansamed took note of the continued detention of Bologna University student Patrick Zaky, who was arrested back in February 2020 on charges of inciting against the state.

ALSO ON OUR RADAR

Malaysian investment in the SCZone? Malaysian Foreign Minister Hishammuddin Hussein yesterday discussed investing in the Suez Canal Economic Zone during talks with SCZone Chairman Yehia Zaki, cabinet said in a statement. The statement appears to suggest that Zaki pitched Hussein on investments in petrochemical manufacturing in Ain Sokhna as well as the rail equipment manufacturing in Port Said.

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

  • Edita Food Industries is investing in (pdf) an EGP 135 mn production line, which is set to start production in February 2022 and increase the company’s production capacity for baked goods by 20%. The statement says the new line will allow it to meet rising demand for its Molto range of products.
  • Amer Group and Orange Egypt have extended a partnership agreement struck a decade ago that will see the mobile network operator provide Amer’s real estate projects with the latest technology and upgrade its digital infrastructure.
  • Telecom Egypt discussed working more closely with Libyan telecoms players on digital transformation with a delegation of Libyan officials in Cairo yesterday.
  • A female TikTok influencer will file an appeal against a 10-year jail sentence she was handed by the Cairo Criminal Court on Sunday for inciting debauchery and “human trafficking.”

PLANET FINANCE

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China is further escalating its clampdown on crypto, ordering all of the country’s major financial bodies to cut off all transactions linked to BTC and other digital currencies, according to a statement by the People's Bank of China yesterday. The Agricultural Bank of China, China Construction Bank, Industrial and Commercial Bank of China, Postal Savings Bank of China and Alibaba’s online payment service Alipay are among the companies ordered to cut payment channels of clients involved in crypto trading, which China sees to have “disrupted the normal order of the economy and financial [system].”

The news sent Bitcoin prices sliding by 10% to as low as USD 31.6k this morning, putting the currency on course for its biggest daily drop since the crash last month. China has been ramping up its regulation of cryptocurrencies, recently banning financial institutions and payment companies from the crypto business and shuttering bitcoin mines.


Big banks could soon be throwing money at shareholders: The results of an annual stress test conducted by the US Fed are due out on Thursday, and if all goes well, 23 large banks including JPMorgan, Morgan Stanley, and Goldman Sachs are expected to release a flood of liquidity into stock dividends and buybacks, reports the Financial Times. The Comprehensive Capital Analysis and Review, which the Fed runs to keep the banking system safe from so-called “doomsday scenarios,” will determine how much of a buffer banks need to hold above regulatory requirements.

Why should you care? The Fed began at the start of the year easing restrictions imposed last year at the start of the pandemic that had capped shareholder payouts and banned buybacks, in measures that were mirrored among regulators around the world, including our very own Central Bank of Egypt.


GLOBAL IPO WATCH- India-based self-drive car rental company Zoomcar is considering a US listing sometime in the next 12 months, CEO and co-founder Greg Moran told Bloomberg. The company, which was backed by a number of early-stage investors including star VC fund Sequoia Capital after it was set up in 2013, is looking to expand to the Middle East this quarter and is eyeing Egypt and Saudi Arabia as potential markets due to their low levels of vehicle ownership, but large upwardly mobile populations.

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8.25% deposit

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USD 31,383

-11.2% (as of midnight)

THE CLOSING BELL-

The EGX30 rose 2.7% at today’s close on turnover of EGP 1.78 bn (29% above the 90-day average). Regional investors were net buyers. The index is down 7.2% YTD.

In the green: Ezz Steel (+5.8%), ElSewedy Electric (+5.6%) and GB Auto (+4.6%).

In the red: Orascom Investment Holding (-1.6%), Credit Agricole (-1.5%) and Export Development Bank Egypt (-1.3%).

AROUND THE WORLD

Iran isn’t cozying up to the US anytime soon: Confirming his title as a hardliner, newly elected Iranian President Ebrahim Raisi has said he would not be meeting with US President Joe Biden and called Tehran’s ballistic missile program “non-negotiable,” according to the Associated Press. Raisi called on the US to remove all sanctions on Iran, but did not comment on the status of negotiations between the incumbent government and world powers over reviving the 2015 nuclear accord, which have made progress in recent days.

Also worth knowing this morning:

  • Saudi Arabia's new ambassador to Qatar has presented his credentials to the Qatari foreign minister, in the first official rapprochement between the two countries after the Al Ula accord this year ended almost four years of diplomatic freeze between Qatar and its Gulf neighbors.
  • Israeli Foreign Minister Yair Lapid will pay his first official visit to the UAE on 29 June, Reuters reports, during which he will inaugurate Israel’s Embassy in Abu Dhabi and consulate in Dubai.
  • Japan will allow locals into the Tokyo Olympics with a 50% capacity limit per venue, organizers said Monday, in a last ditch attempt to save some semblance of fanfare at the event, according to the Associated Press. Organizers may scrap the audience idea altogether if covid-19 cases increase on a national level in Japan, where the majority of people have not yet been vaccinated.
greenEconomy

How are alternative construction materials being used in Egypt? In this multi-part series, we’ve looked at efforts being made by the construction industry to reduce pollution from materials. Some cement industry leaders have begun producing so-called ‘green’ cement. Other companies are seeking independent green building certification to track and reduce their environmental footprint, though with little real impact.

So is there a way to opt out of using heavily polluting construction materials altogether? In a nutshell, some highly innovative applications of alternative construction materials are available in Egypt. But despite rapid growth, their overall market share is still low.

What exactly do we mean by ‘alternative’ construction materials? Definitions vary, but generally refer to two groups of materials. Natural building materials, like bamboo, rice straw, or mycelium (part of a fungus) are usually grown and harvested rather than mined and reformed. Industrially produced concrete-like materials or recycled plastic contain lower emissions than their benchmark competitors. For the purposes of this article, our focus is on natural building materials or unconventional uses of industrially produced ones.

Biotech startup Mycelium uses fungi to convert rice or wheat straw into an alternative material used for insulation panels, reducing plastic use, CEO Mohamed Fawzy tells Enterprise. It’s free of heavily polluting volatile organic compounds (VOCs), he adds. Using mycelium in construction has been gaining traction globally over the last decade. It’s manufactured using natural materials through a low-energy process, making it an environmentally-friendly alternative to plastic products like polystyrene, which is among the most commonly-used materials for insulation panels.

While social enterprise Hand Over follows in the tradition of architect Hassan Fathy, using compressed earth for low-income residential buildings and private developers, representatives tell Enterprise. Its main raw materials are sand, mud and gravel, supplemented with locally sourced materials like natural stones, they add. Using compressed earth for residential construction is an ancient Nubian technique, which architect Hassan Fathy famously intended to use at scale for low-income communities. In the 1940s, he designed New Gourna, a village near Luxor built entirely out of compressed earth.

KarmBuild makes use of discarded natural materials for construction: KarmSolar’s sister company KarmBuild sources locally available natural materials in its projects as much as possible, Principal Architect Karim El Kafrawi tells Enterprise. Its projects in Bahariya used sandstone cleared from agricultural land, while Red Sea projects used limestone discarded by developers. Products are tested for compressive strength, and used to develop wall-bearing structures for buildings, says Kafrawi. KarmBuild is also trying to use compressed earth blocks to replace red bricks in some projects in Cairo, he adds.

Qubix adopts a different approach, with its innovative reuse of industrial steel: Qubix converts used shipping containers into structures that can be used as commercial or residential buildings, co-founder Youssef Farag tells Enterprise. Its construction process not only eliminates the need for conventional materials like brick and cement, but also means that steel containers whose ‘seaworthy’ lifespan has finished — each weighing 3-4 tons — aren’t put through energy-intensive recycling or left in a landfill. Qubix uses standardized local materials in its construction, primarily steel and wood, says Farag.

These businesses are growing: Qubix has delivered over 200 residential and commercial projects since it was founded in 2016, says Farag. Mycelium sells its insulation panels to two companies, who sell them on for use in B2C projects. Founded in 2020, it currently has seven clients in Cairo and Alexandria, and has attracted interest from big corporations including Sodic, says Fawzy. Hand Over has implemented six projects since it was founded in 2016, its representatives say. KarmBuild has completed six buildings since its 2014 founding — two more are currently under construction — and provided design and consultancy services on a host of others, says Kafrawi.

And have already scored some major projects: KarmBuild’s major projects include the KarmSolar operations and maintenance center in Bahariya, along with residential, agricultural and hospitality developments in rural areas around the country, says Kafrawi. It has recently launched a new series of developments closer to Cairo, in areas like Sheikh Zayed, he adds. Qubix completed The Drive, a large-scale drive-through unit housing restaurants and coffee shops, six months ago. It’s currently building a private family compound in Sheikh Zayed with 12 small villas made out of containers, Farag says. Mycelium has secured over USD 65k in funding from Flat6Labs.

But market adoption is still relatively low: Startups like Qubix and Mycelium are highly innovative, but within the Egyptian market as a whole, they aren’t widely used, says Khaled Tarabieh, associate chair of AUC’s architecture department.

The sector’s contribution is a drop in the ocean: Egypt’s construction activity is dominated by large projects like Ora Developers’ EGP 100 bn residential complex, a Fitch market report said last year. Qubix has an estimated 75% share of the shipping container construction market, estimates Farag, but it’s much harder to measure its overall construction market share. “I really can’t even put a number on it, because Egypt’s construction market is one of the biggest in the world. Companies are building entire cities and a monorail. Compared to that, we could be a grain of sand in the desert.” Mycelium will be competing to supply insulation panels with companies like Insutech, which has 100+ clients in Egypt (pdf), or Egypt’s Beta Company — whose 100+ clients include construction giants Orascom, Cemex, and Italcementi.

The question is, can this change? Comparing the growth of startups with established businesses is obviously challenging. But if we want to assess whether it’s really possible to lessen pollution through alternatives to traditional heavy polluters, the issue of market penetration matters. So whether the innovative approaches of this handful of small businesses have the potential to be adopted at scale becomes the key question to answer.


Your top climate stories for the week:

  • National rollout of EV charging stations: The government’s project to set up a nationwide network for charging electric vehicles, which is being led by industry leader Infinity, is expected to cost some EGP 450 mn.
  • AfDB to help finance new round of electricity sector, energy efficiency reforms: The African Development Bank (AfDB) approved an EUR 83 mn loan to finance the second phase of the program, which is designed to promote green energy sources and energy efficiency.
  • US to boost funding to go solar… The US will step up its funding to Egypt to speed up our shift towards renewable energy.
  • …and warns us against fossil fuel investments: US Special Climate envoy John Kerry tells Quartz that he warned Egypt against investing too heavily in oil and gas.
  • One step closer to establishing a state waste management entity: The draft executive regulations of the Waste Management Act have been passed to cabinet for review, with the new legislation to set up a new state agency responsible for waste management.

CALENDAR

22-27 June (Tuesday-Sunday): The CIB PSA World Tour Finals for 2020-2021 will take place in Cairo.

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. The Big 5 Egypt Impact Awards will also be taking place at the event on 27 June.

30 June (Wednesday): The IMF will complete a second review of targets set under the USD 5.2 bn standby loan approved in June 2020 (proposed date).

30 June (Wednesday): 30 June Revolution Day.

30 June- 15 July: The Cairo International Book Fair, Egypt International Exhibition Center.

July + August: Thanaweya Amma exams take place.

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

1 July (Thursday): Large taxpayers that have not yet signed 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.

1 July (Thursday): Businesses importing goods at seaports will need to file shipping documents and cargo data digitally to the Advance Cargo Information (ACI) system.

1 July (Thursday): Deadline for 17 EGX-listed companies to file their 1Q2021 earnings.

4 July (Sunday): Ismailia Economic Court to hold hearing on Ever Given compensation case.

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

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

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

2-4 August (Monday-Wednesday): Egypt is hosting the Africa Food Manufacturing exhibition at the Egypt International Exhibition Center.

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.

12-15 September (Sunday-Wednesday): Sahara Expo: the 33rd International Agricultural Exhibition for Africa and the Middle East.

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.

30 September-8 October (Thursday-Friday): The Cairo International Fair, Cairo International Conference 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.

12-14 October (Tuesday-Thursday): Mediterranean Offshore Conference, Alexandria, Egypt.

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.

1-3 November (Monday-Wednesday): Egypt Energy exhibition on power and renewable energy, Egypt International Exhibition Center, Cairo, Egypt.

1-12 November (Monday-Friday): 2021 United Nations Climate Change Conference (COP26), Glasgow, United Kingdom.

29 November-2 December (Monday-Thursday): Egypt Defense Expo.

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.

14-16 February 2022 (Monday-Wednesday): Egypt Petroleum Show, Egypt International Exhibition Center, New Cairo, Egypt.

1H2022: The World Economic Forum annual meeting, location TBD.

May 2022: Investment in Logistics Conference, Cairo, Egypt.

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.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.

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