Monday, 26 July 2021

Egypt beats 2020-2021 budget deficit, primary surplus targets

TL;DR

WHAT WE’RE TRACKING TODAY

It seems that with each passing day, the global news agenda is being taken over by the delta variant and the increasing concerns about what it might mean for the global economy and for efforts to end the pandemic. Whether we’re talking about recent moves in the US financial markets, new restrictions in Europe, a “perilous moment” for global supply chains, or an escalating political crisis in Tunisia, the resurgence of covid-19 is back front and center in the pages of the international press.

Fortunately for us, the picture couldn’t be more different here at home. With Egypt so far dodging the delta bullet and seeing daily cases at their lowest levels since the first wave over a year ago, the domestic news agenda is refreshingly covid-lite. We lead today’s issue with a double dose of optimism on the fiscal front: Fresh figures released yesterday showed that the government easily outperformed its 2020-2021 primary surplus and budget deficit targets, while the IMF is projecting a strong rebound in FDI and tourism over the coming years. A fresh securitized bond issuance and a seven-figure seed investment round out this morning’s news well.

HAPPENING THIS WEEK-

A Russian delegation will visit Egypt tomorrow to assess the covid-19 situation in Hurghada and Sharm El Sheikh, Civil Aviation Minister Mohamed Manar said in a phone interview with Ala Mas’oulety’s Ahmed Moussa last night (watch, runtime 13:50). This comes as a prelude to the return of Russian flights to the Red Sea resort towns on 9 August following a six-year hiatus.

The Senate is now on recess, having wrapped up its final session on 19 July, according to a presidential decision published in the Official Gazette (pdf) yesterday.

When will MPs follow suit? It’s still not clear when MPs will be following senators to Sahel. Typically, the end of the legislative cycle coincides with the end of the fiscal year, but this year’s session has dragged on into July, with lawmakers still needing to hold final votes on several bills.

THE BIG STORY IN THE REGION- Tunisian president Kais Saied has removed the country’s prime minister and suspended parliament in response to violent clashes between police and protesters angry with the government’s handling of the covid-19 pandemic and the economy. In a challenge to Tunisia’s nascent democracy, Saied said he would assume executive power alongside a new prime minister who would be appointed in the coming hours. Protesters, who had directed their ire at the dominant Ennahda Party and called for early elections, reacted to the news by celebrating in the streets. The story is getting a lot of attention in the foreign press: Associated Press | Bloomberg | Sky Arabia | Reuters.

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

  • Aldar gets more time for SODIC MTO: The UAE real estate developer has another 30 working days to submit a mandatory tender offer to acquire at least 51% of Sodic after regulators extended the deadline for the third time.
  • UAE’s Bee’ah is lobbying for more contracts in new cities: The waste management company could also be looking to extend its 15-year contract to provide waste management services for the new administrative capital as new phases of the city are inaugurated.
  • Tech, vocational education get more German funding: German development bank KfW will provide EUR 41 mn to the Education Ministry over the coming year for projects that aim to develop technical and vocational education in Egypt.

M&A UPDATE- Bank ABC yesterday confirmed in a disclosure (pdf) to the Bahraini stock exchange that it has received approval from the Financial Regulatory Authority to go ahead with its acquisition of up to 100% of Blom Bank Egypt’s shares. The mandatory tender offer period will run from Sunday 25, July to Thursday, 5 August, during which it will offer to purchase 300 mn shares for EGP 22.33 apiece, valuing the bank at at USD 427 mn (EGP 6.7 bn).

Advisors: HSBC Bank Middle East is providing financial advice to Bank ABC, and Freshfields Bruckhaus Deringer and Zulficar & Partners are acting as legal advisors. CI Capital is acting as the financial advisor to Blom Bank, and Baker McKenzie is providing legal counsel.

SMART POLICY- Abu Dhabi is slashing business fees as it looks to stimulate private sector-led economic growth. From 27 July, business setup fees will be reduced by 94% to just AED 1k, while license renewal fees for existing businesses have also been cut to AED 1k, the Abu Dhabi media office said yesterday.

CIRCLE YOUR CALENDAR-

The Clean Energy Business Council will host a webinar focused on female entrepreneurs in the MENA renewable energy scene at 3 pm on Wednesday, 28 July.

Egypt will host the Africa Food Manufacturing exhibition at the Egypt International Exhibition Center on 2-4 August.

The Central Bank of Egypt will meet to review interest rates on Thursday, 5 August.

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

enterprise

*** 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: Launching new technical colleges designed to produce students whose skills better match labor market needs is key to the government’s current higher education strategy, and six new colleges are due to be launched during the current fiscal year. CIRA, meanwhile, is setting up Egypt’s first private sector tech college in September 2023. But will we see more private sector companies follow CIRA’s lead and enter the sector?

enterprise

We can't wait to see the endurance sports community back at Somabay, taking on the Supersprint, Sprint, Olympic, Youth, & Kids Races. Early-Bird Registration for the Somabay Endurance Festival is now open.

ECONOMY

Egypt beats budget deficit, primary surplus targets in 2020-21

Egypt’s primary surplus, budget deficit beat expectations in 2020-2021: Egypt recorded a primary surplus of 1.4% of GDP, or around EGP 93.1 bn, during FY2020-2021, Ittihadiya said in a statement yesterday.

This is comfortably higher than the 0.9% targeted by the government and better than the IMF’s expectations for a 1% primary surplus. Egypt achieved a 2% primary surplus before the pandemic hit. In FY2021-2022, the Finance Ministry expects the country’s primary surplus to increase to 1.5%, before falling to 1.3% the year after.

The budget deficit also narrowed more than expected: The budget deficit reached 7.4% in FY2020-2021, from 8% a year prior. This exceeded the ministry’s initial target of 7.8%, and was mostly in line with the IMF’s 7.3% forecast. Moving forward, the budget deficit is expected to narrow to 6.7% of GDP this fiscal year, before dropping to 6.2% in FY 2022-2023

Revenues outpace spending: Revenues increased by 12% y-o-y (EGP 119 bn), outpacing spending which rose 9% y-o-y, the statement said, without disclosing the figures.

And debt-to-GDP declined: The country's public debt dropped to 90.6% of GDP in FY2020-2021 thanks to the Finance Ministry’s shift to longer tenor debt, which has seen it lengthen the average maturity from 1.3 years before June 2017 to 3.45 years as of June 2021, the statement said.

ECONOMY

FDI to grow in Egypt over coming four years – IMF

The IMF sees FDI in Egypt climbing in each of the next four years. Egypt could see foreign direct investment jump as much as 60% this fiscal year compared to last year, the International Monetary Fund said in a report (pdf) released following its second review of Egypt’s USD 5.2 bn standby facility. The IMF sees Egypt landing FDI of USD 8.6 bn in FY2021-2022, up sharply from USD 5.4 bn last year — and forecasts that FDI will rise to USD 11.7 bn in FY2022-2023 before hitting USD 16.5 bn in FY2024-2025.

Strong rebound in tourism in the cards: Tourism revenues are similarly expected to see a rebound to USD 8 bn this fiscal year, up from a projected USD 4.4 bn in FY2020-2021. This will further increase to USD 15 bn in FY2022-2023, reaching USD 25.1 bn in FY2024-2025. “Tourism receipts are expected to remain subdued as travel restrictions in many key tourist markets remain in place,” read the report, though the resumption of direct flights from Russia to Red Sea destinations next month will likely brighten the outlook. Receipts are expected to reach pre-pandemic levels of 4% of GDP in FY2023-2024.

The picture isn’t quite as healthy for the overall trade balance, which the IMF sees falling deeper into deficit over the next four years. Exports will increase only marginally from USD 29.4 bn during the current fiscal year to USD 32.1 bn in FY 2024-2025, and will be outpaced by import growth which will surge from USD 65.9 bn this year to USD 83.8 bn by the middle of the decade.

Suez Canal revenues are expected to hit USD 6.6 bn in FY2021-2022, and to inch up to USD 7.6 bn by FY2024-2025. Suez Canal revenues hit a record USD 5.84 bn last year.

Foreign reserves will continue to creep up over the next 12 months, reaching USD 44.1 bn by the end of the current fiscal year. Reserves will surpass pre-pandemic levels in FY2022-2023 to reach USD 47.6 bn, before climbing to USD 55.1 bn by the middle of the decade.

GDP forecasts remain unchanged: The IMF expects economic growth to almost double to 5.2% in FY2021-2022 from a projected 2.8% in the previous fiscal year. This will rise again to 5.6% in FY2022-2023 before ticking up to 5.8% by FY2024-2025.

OTHER ECONOMY NEWS- Egypt will have the third largest economy in the Arab region by the end of 2021, Forbes reports, citing IMF forecasts. The fund expects the Egyptian economy to be worth USD 394.3 bn by the close of the year. Despite almost a 10% increase from 2020’s GDP, Egypt will slip one spot as the UAE sees a 13% increase in GDP to USD 401.5 bn. Egypt follows Saudi Arabia, which will maintain its position as the largest regional economy, with a GDP of USD 804.9 bn, according to the IMF.

DEBT WATCH

EFG Hermes closes fifth securitized bond sale for Premium International

EFG Hermes closes EGP 211 mn securitized bond issuance for Premium International: EFG Hermes has completed the fifth tranche of Premium International's EGP 2 bn short-term securitized bond program, EFG Hermes said in a statement (pdf). The EGP 211 mn issuance comprises a single 10-month tranche rated “Prime 1 Rating” — the highest rating assigned by Middle East Ratings and Investor Services.

This is the second issuance for the consumer finance firm this year after EFG closed the fourth, EGP 170 mn tranche in January.

Premium has now completed almost half of the EGP 2 bn program, selling securities worth EGP 902 mn during the five tranches. In October 2019, Premium closed the first EGP 167 mn issuance of the program, the second, EGP 172 mn offering in April 2020 and the third, EGP 182 mn issuance in September 2020.

Advisors: EFG Hermes is assigned as the sole financial advisor, sole transaction manager and book-runner, underwriter, and arranger on the issuance.

STARTUP WATCH

Proptech startup Nawy raises seven-figure seed round led by Sawiris family office

Egyptian proptech startup Nawy raised an undisclosed seven-figure seed round led by the Sawiris family office, the company announced in a statement (pdf) yesterday. Multiple angel investors also participated in the round, including Etisalat Group CEO Hatem Dowidar, in what marks Nawy’s first external funding. The founders have invested USD 200k from their own pockets since launching the company in 2016.

About the company: Nawy is a real estate search engine that allows users to search for and filter properties, and helps them to pay for the property via its brokerage arm. In the five years since its founding, the company has helped more than 30k customers purchase property, and aims to treble its revenues and gross merchandise volume this year, co-founder Ahmed Rafea told us.

How the money will be spent: The company will use the funds to improve its technology, diversify its services, and expand the team. The startup isn’t looking to expand abroad in the foreseeable future, but could later on consider entering Saudi Arabia, the UAE, and South Africa, co-founder Abdel Azim Osman told Forbes.

COVID WATCH

Sinopharm might not be great at protecting the elderly from covid

Sinopharm vaccine may provide only low protection to elderly: A new study has suggested that the Chinese Sinopharm vaccine has a low efficacy rate at preventing covid-19 infection among the elderly. Blood samples taken from 450 people in Hungary have shown that almost 50% of people aged over 80 hadn’t developed protective antibodies at least two weeks after receiving their second Sinopharm dose.

But the vaccine is effective at protecting younger ages: 90% of those under 50 developed a strong shield against the illness, the study claimed

The study is yet to be reviewed by other scientists. China’s National Health Commission refused to comment on studies other than those conducted by governments or major research institutions, according to the Associated Press.

Sinopharm is one of Egypt’s vaccines of choice: Egypt has imported 2.9 mn doses of the vaccine, accounting for almost half of the total 6.2 mn shots received so far.

The Health Ministry reported 39 new covid-19 infections yesterday, up from 38 the day before. Egypt has now disclosed a total of 284,024 confirmed cases of covid-19. The ministry also reported six new deaths, bringing the country’s total death toll to 16,487.

LEGISLATION WATCH

KWD 5.5 mn Kuwait Fund for Arab Economic Development loan ratified

The North Sinai cities of Rafah and Bir Al Abd will be getting new water desalination plants, after President Abdel Fattah El Sisi ratified a KWD 5.5 mn loan agreement between Egypt and the Kuwait Fund for Arab Economic Development, according to a decision published in the Official Gazette (pdf).

A draft bill to protect and increase production at Egypt’s fisheries was approved in principle by the House yesterday, Al Masry Al Youm reports. The new law aims to regulate the establishment of fish farms, while protecting lakes and fisheries against pollution and land encroachment, Agriculture Minister Al Sayed El Quseir told lawmakers during the session yesterday.

What does the bill entail? A regulatory body, affiliated to the cabinet, will be set up to manage Egyptian lakes in a bid to double their fish production. Under the bill, the authority will issue licenses for fish farms and fish processing projects, as well as regulate fishing ports and other related operations.

enterprise

LAST NIGHT’S TALK SHOWS

Egypt’s economic performance in FY2020-2021 topped the agenda of the nation’s talking heads yesterday: Kelma Akhira’s Lames El Hadidi (watch, runtime: 3:28) and Al Hayah Al Youm (watch, runtime 1:40) both covered the fiscal figures released by Ittihadiya yesterday, which showed that the government beat its budget deficit and primary surplus targets. Arqaam Capital analyst Noaman Khalid told El Hadidi that the government’s response to the covid-19 pandemic contributed to the positive figures, reacting in a way that mitigated its impact on public finances (watch, runtime 5:58). The IMF’s ranking of Egypt as the third largest economy in the Arab region by the end of 2021 also got attention from Al Hayah Al Youm (watch, runtime 5:39). We have more details on the story in this morning’s Economy section, above.

There was more speculation about an incoming cabinet shuffle on the airwaves: MP Mostafa Bakry said in a phone interview with Ra’ee Aam that Prime Minister Mostafa Madbouly is the only minister whose position is safe, and suggested that both Foreign Minister Sameh Shoukry and Interior Minister Mahmoud Tawfeek could be on their way out of government (watch, runtime 7:05). Meanwhile, El Hekaya’s Amr Adib called for the appointment of younger ministers to the cabinet (watch, runtime 2:03).

EGYPT IN THE NEWS

It’s a slow morning in the pages of the international press: Reuters talks to Egypt’s Olympic badminton hopefuls Doha Hany and Hadia Hosny, while a UK socialist paper reports on Egyptian detainee Hisham Fouad, who recently launched a hunger strike in protest at the conditions of his imprisonment.

ALSO ON OUR RADAR

Mercedes-Benz will set up a logistics center in Ain Sokhna under an agreement with the Suez Canal Economic Zone (SCZone), according to a statement. Established within the SCZone, this is a step forward to support the auto industry in the area, SCZone Chairman Yehia Zaki said. The center will include a car storage facility and maintenance facility.

A precursor to something bigger? Government sources told us in October that the German auto giant could soon resume assembling passenger cars in Egypt following a five-year hiatus. We haven’t heard anything from the company or the government since.

Pioneers board signs off on three-way split: Pioneers Holding shareholders approved on Saturday plans to split the firm into three separate entities focused on financial services, real estate and industrial development each, the company said in an EGX filing (pdf). The vertical spin-off — first announced in 2019 — will see a split of the company’s real estate and industrial investment businesses into subsidiaries Pioneers Properties and Gadwa Industrial Developments, with Pioneers Holding remaining the parent company and financial services arm.

Egypt is still trying to extradite Mohamed Ali: An Egyptian court has called on Interpol to issue an order for the arrest of exiled contractor / dissident Mohamed Ali and two others on charges of spreading fake news and joining an illegal group. In 2019, a series of viral videos by Ali alleging that officials had misused public funds led to a wave of small anti-government protests around the country.

PLANET FINANCE

Powered by
EFG Hermes - https://efghermes.com/

“A perilous moment for supply chains”: That’s the prognosis of one shipping insider as a resurgence in global covid cases and a series of natural disasters heaps pressure on supply chains, Reuters reports. Floods in China and Europe, covid outbreaks in Asia, and a cyber attack on South African ports are combining to disrupt global trade at a time when supply chains are still recovering from the shock of the initial wave of covid last year. Industry insiders say that a lack of containers, a shortage of vessels, and operational setbacks are causing blockages at ports not seen in decades.

Manufacturers are being hit hard: A shortage of parts, rising prices, and labor disruption caused by covid have forced manufacturers in countries across the world to cut back on production. Toyota was forced to halt production in Japan and Thailand last week after not being able to get the parts, while Europe's biggest home appliances maker, Electrolux, said it is having to scale back production.

What impact will this have on the global recovery? It’s too early to say, though early signs out of the US aren’t great. The US flash PMI for July showed economic activity falling to a four-month low as businesses found it harder to access raw materials and labor.

We have a few months of this left: Analysts say that we’re probably not going to see the end of it until 4Q2021 or 1Q2022.

Traders to go risk-on on EM despite mounting covid worries? Traders are shrugging off concerns about rising US inflation and the delta surge and are buying into emerging markets, Bloomberg reports. Some analysts are anticipating a pick-up in risk appetite, betting that investors will focus on improvements in EM assets and downplay the likelihood of tightening by the Federal Reserve. EM earnings are above estimates for the first time in 2.5 years while MSCI’s EM currency and bond indexes remain up year-to-date, despite falling back this month.

EMs helped by strong growth potential and hopes for improved vaccine rollouts: “Emerging markets still look to me like that place where investors will find the best-priced earnings growth, and I expect that the continuing rapid pace of vaccination across many EM countries will increase conviction,” said one analyst. Not only that, but emerging nations are expected to outperform developed economies, with growth estimated at 6.6% to 5.4% respectively.

Over in the US, investors are reverting to their 2020 picks as covid cases rise. Money is returning to tech stocks, and bond and money-market funds, as concerns about the spread of covid variants begin to outweigh recent optimism about the now-stalling vaccine rollout in the US, Bloomberg reports. In signs of increasing caution, last week the Nasdaq reached new record highs, Moderna, Twitter and Facebook were the best performers on the S&P 500, and bond and money-market funds saw USD 13 bn of inflows compared to just USD 3.3 bn into stocks.

Up

EGX30

10,746

+0.9% (YTD: -0.9%)

None

USD (CBE)

Buy 15.64

Sell 15.74

None

USD at CIB

Buy 15.64

Sell 15.74

None

Interest rates CBE

8.25% deposit

9.25% lending

Up

Tadawul

10,876

+0.8% (YTD: +25.2%)

Up

ADX

7,105

+0.6% (YTD: +40.8%)

Up

DFM

2,774

+1.1% (YTD: +11.3%)

Up

S&P 500

4,411

+1.0% (YTD: +17.5%)

Up

FTSE 100

7,027

+0.9% (YTD: +8.8%)

Up

Brent crude

USD 74.10

+0.4%

Up

Natural gas (Nymex)

USD 4.06

+1.4%

Down

Gold

USD 1,805.90

-0.2%

Up

BTC

USD 34,531

+1.2% (as of midnight)

THE CLOSING BELL-

The EGX30 rose 0.9% at yesterday’s close on turnover of EGP 1.5 bn (19.3% above the 90-day average). Local investors were net buyers. The index is down 0.9% YTD.

In the green: GB Auto (+5.5%), Sidi Kerir Petrochemicals (+3.9%) and Abou Kir Fertilizers (+3.1%).

In the red: Sodic (-1.8%), Cleopatra Hospital (-0.9%) and Telecom Egypt (-0.7%).

AROUND THE WORLD

Lebanese Sunni tycoon Najib Mikati could be nominated as the country’s next prime minister-designate after securing the backing of a number of former Lebanese PMs. This comes a week after Saad Hariri resigned from his post after being unable to agree on a cabinet with Christian president and Hezbollah ally Michel Aoun. Hariri, as well as ex-PMs Fouad Siniora and Tammam Salam, have given their support to Mikati a day before Aoun and MPs meet to try and agree on a new PM-designate. (Bloomberg)

China has imposed counter-sanctions on seven US officials and organizations including former US commerce secretary Wilbur Ross in response to a similar move by the Biden administration against Chinese officials as well as its warning to US companies about doing business in Hong Kong. (Bloomberg | FT)

Israel has launched two direct flights to Morocco to boost tourism, trade and economic cooperation in the latest step following the normalization of relations that took place in late 2020. (Associated Press)

blackboard

New technical colleges are key to the government’s current education strategy. But can the private sector buy in? Launching new technical colleges to produce students whose skills better match labor market needs has become a top government priority. A plan is underway to launch six new government technical colleges in FY2021-2022, after three were recently established in New Cairo, Quesna and Beni Suef. All nine cost approximately EGP 1 bn, Ahmed El Hayawi, who heads the Higher Education Ministry’s Education Development Fund (EDF) — the government agency overseeing the establishment of the government’s tech colleges — estimated in March.

Enter private sector education outfit CIRA, which plans to launch Egypt’s first private sector technical college in September 2023, CEO Mohamed El Kalla tells Enterprise. Other private sector operators are eager to gauge if there’s a market for private applied tech institutions, he notes. “And when it comes to industry players, there’s been nothing but excitement.”

What are technical colleges? Think of them as advanced apprenticeship programs merging academics and technical training. CIRA and the government’s tech colleges will offer two-year + two-year degree programs, regulated by the Higher Education Ministry. Students that complete the first two years graduate with technical diplomas, while students that complete all four years are awarded Bachelor’s degrees. CIRA tech college graduates will be able to sit the Meister exam — a German vocational qualification that allows holders to study at German applied sciences universities.

The issue everyone’s trying to address? Employability: The government and CIRA are trying to bridge Egypt’s ‘employability gap’, identified by the private sector and development finance institutions like the EBRD. Industry employers struggle to find candidates with both strong technical skills and the soft skills needed for the workplace, says El Kalla. The tech colleges aim to tackle this: students will graduate with highly sought-after Bachelor’s degrees — and academic training — along with practical skills they can use immediately in technical positions, he adds.

A few core subjects are the focus for the new degrees: New energy programs, automotive technology, health, and manufacturing artificial limbs are the most in-demand programs in public tech colleges, and currently some 2k students are studying them, says El Hayawi. CIRA hasn’t finalized which disciplines its tech college will offer, but they’ll likely be linked to sectors identified by the IFC and others as key areas for growth in Egypt: logistics, tourism, medical and industrial manufacturing.

And practical work experience will be a core component: Students in government colleges will be able to seek employment after obtaining their technical diplomas, and return within three years to complete their Bachelor’s degrees, Beni Suef University of Technology President Sayed Abdel Kader tells Enterprise. Under CIRA’s program, students will need to spend at least two semesters working in an industry or service area after completing their first two years, says El Kalla.

This all needs private sector buy-in: CIRA is looking into setting up partnerships with industry associations and multinationals to facilitate work experience for technical college attendees, says El Kalla. Meanwhile, private sector companies El Sewedy, Samsung and Bavaria have already funded labs at public tech colleges, says El Hayawi.

Gov’t colleges are leveraging international expertise and resources where possible: Beni Suef University of Technology has already been awarded a grant of USD 5.8 mn from Korea Tech University, says Abdel Kader. The grant is going towards the study of labor market needs, training faculty members, and setting up labs, he adds.

And so is CIRA: German private sector education provider Saxony International School (SIS) and Switzerland’s Business and Hotel Management School are providing their own technical curricula for CIRA’s technical college. For a year, they’ll train a cohort of some 60 Egyptian instructors. The German and Swiss partners will manage the college campus — located at CIRA’s Badr University — for its first five years, says El Kalla. In exchange, CIRA’s paying them a retainer and a percentage of student fees.

Finding the right candidates to train as technical college instructors will be challenging, notes El Kalla. Ideally, they’d be mid-career professionals — either academics or industry experts able to focus on employability, he says. CIRA plans to conduct a long interview process starting in June 2022 to find the right candidates.

But strong interest is expected from students: CIRA’s target students would normally attend apprenticeships programs that don’t offer academic degrees — either because they didn’t get the required Thanaweya Amma grades or because they can’t afford university — says El Kalla. “But they all want Bachelor’s degrees.” CIRA’s technical college will cost only slightly more than these programs, he adds: “Nothing that exceeds EGP 30k per year.” The minimum qualification for acceptance will be the Thanaweya Amma or a technical high school diploma, he says.

Private sector industry players seem keen to get on board: “Ever since we announced our plan to set up a private tech college, we’ve been bombarded with interest,” says El Kalla. High turnover and a lack of qualified employees are major problems for private sector companies, who often resort to in-house training. They have a vested interest in helping the tech colleges get off the ground, he adds.

Looking ahead, more private sector education operators could follow in CIRA’s footsteps — perhaps through public-private partnerships. Private sector players and the government are said to be mulling public-private partnerships to set up tech colleges, though no action has yet been taken, say sources. The government would also consider setting incentives to encourage private sector investment, says El Hayawi.

Though for now, profitability concerns are causing some private sector hesitation, El Hayawi says. Technical colleges need to be well furnished with labs and workshops, raising the cost of establishing a single institution to EGP 700-800 mn, he adds. So private sector operators are currently more focused on building the capacity of scientific and tech departments in existing private universities, he believes. He expects this to change, saying we’ll see a host of private tech colleges spring up within three years.

Your top education stories for the week:

  • Public-private partnerships: The government will establish 1k language schools by 2030 in partnership with the private sector, providing quality education with reduced fees.
  • German education funding: German development bank KfW is set to provide EUR 41 mn to the Education Ministry over the coming year for projects that aim to develop technical and vocational education in Egypt.
  • More local branches of European universities: A syndicate of banks led by the National Bank of Egypt will provide (pdf) an EGP 962 mn loan for the establishment of new branches of European universities in Egypt.
  • CIRA net income increases by 40%: Private sector education boosted CIRA’s net income by 40% in the first nine months of FY2020-2021.

CALENDAR

Mid-July: Legislative session expected to end.

23 July-11 August (Friday-Wednesday): Tokyo 2020 Olympics.

28 July (Wednesday): Clean Energy Business Council’s webinar Women entrepreneurs in clean energy (3pm)

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.

9 August (Monday): Russian flights to Sharm El Sheikh, Hurghada resume.

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

3-5 September (Friday-Sunday): The World Karate Federation will hold the third competition of the 2021 Karate 1-Premier League in Cairo.

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

15 September (Wednesday): The CFO Leadership & Strategy Summit is taking place in Egypt.

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.

30 September: Closing of 2021’s first oil and gas tender in the Gulf of Suez, Western Desert, and the Mediterranean.

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

1 October (Friday): Expo 2020 Dubai opens.

1 October (Friday): State-owned companies and government service bodies selling goods and services to customers 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.

6 October (Wednesday): Armed Forces Day.

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

11-17 October (Monday-Sunday): IMF + World Bank Annual Meetings.

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.

24-28 October (Sunday-Thursday) Cairo Water Week, Cairo, Egypt.

27-28 October (Wednesday-Thursday) Intelligent Cities Exhibition & Conference, Royal Maxim Palace Kempinski, Cairo, Egypt.

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

30 October – 4 November (Saturday-Thursday): The first edition of Race The Legends, Egypt.

November: The French-Egyptian Business Forum is set to take place in the Suez Canal Economic Zone.

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

November: Egypt will host another round of talks to reach a potential Egyptian-Eurasian trade agreement, which can significantly contribute to increasing the volume of Egyptian exports to the Russia-led bloc that includes Armenia, Belarus, Kazakhstan and Kyrgyzstan.

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

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

12-14 December (Sunday-Tuesday): Food Africa Cairo trade exhibition, Egypt International Exhibition Center, Cairo, Egypt.

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. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Etisalat Misr (tax ID: 235-071-579), the leading telecoms provider in Egypt; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.