Thursday, 19 August 2021

Swvl to enter Europe with acquisition of on-demand shuttle service, Shotl



Well, friends, we’ve nearly made it through another week together. We hope the workday is kind to you, that traffic on the road to Sahel is light and that you’re able to unplug and enjoy time with family and friends.

It’s a busy news morning here in Egypt, with everything from a cross-border M&A to the passage of the sovereign sukuk act and the prospect we’ll be in the fourth wave of covid-19 by late September. We have chapter and verse on all of this and more in this morning’s Speed Round, below.


Naftali Bennett could become the first Israeli PM to visit Egypt in over a decade: President Abdel Fattah El Sisi has invited Israeli Prime Minister Naftali Bennett for an official visit to Egypt within the next few weeks, Bennett’s office said in a statement yesterday. The invitation came during a visit to Jerusalem yesterday by Egyptian intelligence chief Abbas Kamel.

Not since January 2011 has an Israeli leader embarked on an official visit to Cairo: The last person to make the trip was then-prime minister Benjamin Netanyahu, who met Hosni Mubarak just a few weeks before the revolution forced the latter out of office.

MEANWHILE- The Tourism Ministry has finished drafting a three-year international promotional campaign that is set to launch by year’s end, designed to revive the nation’s tourism trade following the covid shutdown, according to a cabinet statement. The ministry will be holding workshops to brief industry players on its plans.

Kuwait has decided to resume commercial flights to Egypt under a cabinet decision issued yesterday. An exact date for flight resumption has yet to be set. Only travellers vaccinated with the Johnson & Johnson, Oxford / AstraZeneca, Moderna, and Pfizer / BioNTech jabs will be permitted entry into Kuwait, according to a tweet. Reuters also has the story.

THE BIG STORY ABROAD- Afghanistan, of course, where Reuters is setting the pace with an exclusive suggesting that the Taliban will likely rule through a governing council. Citing conversations with a senior leader of the group, the newswire reports that Haibatullah Akhundzada, the Taliban’s leader, will “likely play a role above the head of the council.” Whoever heads the council would serve as the country’s effective president. News out of Afghanistan also leads the front pages of the New York Times, Washington Post, Wall Street Journal and Financial Times.

The big story abroad that matters most to us here in emerging markets: A majority of US Fed officials think the central bank should start winding down its stimulus program this year, according to minutes from their most recent meeting in July.

Why do we care in EM? Among other things, because this is effectively a prelude to the Fed raising interest rates “if the economy strengthens further next year,” boosting the attractiveness of US debt and sapping some of the flows into EM (which are, by definition, riskier and so offering higher interest rates). At the risk of really oversimplifying things: The narrower the gap between US and EM rates, the less attractive EM debt is. A move to raise US interest rates would put pressure on emerging markets to raise rates (or keep them high) to ensure EM debt remains attractive. The Dow and S&P declined for a second day yesterday as the minutes came out. (The Fed raising rates also has big implications for EM — like KSA — that have pegged their currency to the USD, but that ain’t us.)

The news from the Fed is getting heavy play in the global business press, from the Journal to Reuters, CNBC and the Financial Times.

How does this stuff work? It’s not a full Enterprise Explains story, but we looked in March at what rising US treasury yields mean for bonds, stocks, and the EGP.

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

  • A fund run by Rachid Mohamed Rachid has a stake in Okhtein: Bidayat has acquired a stake in Okhtein, the luxury handbag maker’s CEO told us.
  • Contact Factoring to finance margin trading: Contact Financial’s factoring arm will finance margin trading at HC Brokerage to the tune of EGP 400 mn.
  • Fawry shareholders complete EGP 1.2 bn share sale: Several shareholders in Egypt’s leading e-payment company, Fawry, sold a 4.3% stake in a follow-on share sale on the EGX worth EGP 1.2 bn.


Dive into nature, where raw beauty reigns supreme. Wake up to breathtaking sunrises and enjoy a serene beach experience amongst family and friends at the Soma Coves beach. This is where you can fully immerse yourself into a picturesque vacation, any time of the year.


Swvl will expand into Europe through Shotl acquisition

Swvl to acquire Europe’s answer to on-demand shuttles: Mass transportation startup Swvl has agreed to acquire Barcelona-based “multiservice collective mobility platform” (how’s that for a mouthful?) Shotl, an unnamed source with direct knowledge of the transaction tells Reuters. The source did not disclose details on the timeline or value of the acquisition as the talks are not yet public.

If completed, the takeover would see Shotl serve as Swvl’s HQ in Europe — and would more than double Swvl’s geographic footprint, with the European startup operating in 22 cities across 10 countries, including Brazil and Japan. A senior source at Swvl had previously told us the company plans to tap into “at least 50 new markets in the short term,” while founder Mostafa Kandil had recently said the company was mulling the acquisition of an unnamed firm in Europe.

The Shotl acquisition would also mark Swvl’s entry into the self-driving game: Swvl and Shotl will together take part in a European Commission-led project designed to showcase how autonomous buses can have a positive impact on the future of public transport, the source told Reuters.

SPAC-tastic: Swvl said last month it would go public on the Nasdaq in 4Q2021 through a merger with blank-check firm Queen’s Gambit Growth Capital. The agreement values the company at around USD 1.5 bn, and the listing will raise the company’s capital to USD 550 mn from USD 100+ mn today. Swvl is also mulling an IPO on the EGX in 2022-2023 and expects to become profitable for the first time in 2024, CFO Youssef Salem previously told Reuters.

“What’s Shotl,” we hear you ask? Established in 2017, Shotl is an on-demand bus platform that incorporates a “demand responsive transport system” that focuses on underserved or difficult to reach areas. Crunchbase suggests the company has raised nearly USD 1.1 mn in two rounds.

What’s next for Swvl? The company says it will, starting 2023, begin expanding into sectors such as logistics, advertising and financial services.


Telecom authority adopts framework to regulate data centers, cloud computing

Egypt’s National Telecom Regulatory Authority (NTRA) has adopted a regulatory framework for data centers and cloud computing, according to a statement yesterday. The new framework, designed in consultation with local and international data and cloud computing firms, will help Egypt attract investment and establish itself as a regional hub for data infrastructure, the regulator said.

Egypt is hoping to capitalize on certain strategic advantages to become a heavyweight in the data center industry — but as we reported back in February, progress has so far been slow. This new framework could address some of the challenges that stand in the way, including slow local user speeds and bandwidth due to poor fiber-optic infrastructure, high pricing (particularly for international traffic), a lack of private sector involvement, and a need for more technical know-how.

Head in the cloud? You can read a refresher on Egypt’s data hub ambitions here and here.


Sovereign Sukuk Act signed into law

The long-awaited Sovereign Sukuk Act is now law of the land, paving the way for the issuance of our maiden sharia-compliant bonds on local and international debt markets. President Abdel Fattah El Sisi has signed off on the bill, according to the Official Gazette (pdf).

The government is eager to get the ball rolling, with the Finance Ministry previously saying that it would start working on its first issuance as soon as the legislation takes effect when the executive regulations of the bill, which received its final rubber stamp from the House in June, are published within three months at most. The exact timing and size of the planned offering remains unknown.

The bill defines the different types of sukuk, which include ijara, mudaraba, istisnaa, murabaha and wakala sukuk. It will also set a term limit of 30 years on all sovereign sukuk and establish the Sovereign Sukuk Company, a joint stock company to execute and manage sales. The act’s executive regulations will cover setting up a regulatory oversight committee, clarifying how disputes between the government and sukuk holders should be handled, and will form an association to protect the rights of investors.

But Enterprise, what are sukuk? We’ve got you covered with this explainer.

Other laws greenlit by El Sisi:

  • Amendments giving the Supreme Constitutional Court (SCC) authority over international rulings. The changes give the court power to effectively overturn the local implementation of international court rulings if they violate the constitution, at the request of the prime minister.
  • A law to set up an emergency medical response fund that will replace the current system of disparate family health centers around the country, providing financial support during major emergencies.
  • Amendments obliging cotton ginners to record the quantity and quality of their cotton supplies and make records available to the Cotton Arbitration and Testing General Organization. Those who are in violation may have their supplies seized, and could face up to six months in jail, or pay a fine ranging from EGP 100k to EGP 1 mn.
  • Amendments to the penal code handing people found guilty of [redacted] harassment tougher penalties including minimum five-year prison terms and fines worth EGP 200k-300k. Minimum seven-year jail sentences will be handed to people who collaborate with others, use weapons or have professional or personal authority over the victim.


ElSewedy’s United Metals secures USD 25 mn in funding from EBRD

ElSewedy’s United Metals Company subsidiary lands USD 25 mn loan from EBRD: The European Bank for Reconstruction and Development (EBRD) has agreed to provide to ElSewedy’s subsidiary United Metals Company (UMC) a two-year, USD 25 mn facility to finance the company’s working capital needs and provide funding to source raw materials amid the covid-19 disruption, the European lender said on its website yesterday. The finance will also be geared towards improving UMC’s engagement, recruitment and integration of disabled workers, EBRD said.

United Metals Company is 99.8% owned by El Sewedy Electric and had received a previous EBRD facility in 2017, according to the European lender’s statement, and another in 2019.

The company had been feeling the crunch of the global commodities boom, which drove up the price of a key production input, copper cathodes, in 2H2020. Prices have spiralled since the global pandemic erupted, with the futures price of copper more than doubling since March 2020, reaching a record high in May thanks to widening supply-demand gap that is likely to continue for some time, market strategists say.


Misr Travel, Structure Line reach EGP 500 mn settlement

Misr Travel ends its dispute with Structure Line: Saudi Structure Line Development has agreed to pay an EGP 500 mn settlement to Holding Company for Tourism and Hotels subsidiary Misr Travel to end a years-long dispute over land in Nasr City, Hapi Journal reports, citing a statement. The company will pay in installments over six months, with the initial EGP 90 mn payment occurring after the final agreement has been signed. Enterprise was unable to independently verify the veracity of the claims made by the newspaper.

What’s the dispute about? Both companies had signed an agreement in 2016 to develop a residential project, dubbed Arena City Towers, on land owned by Misr Travel. Under the agreement, Misr Travel was entitled to have 51% of the project’s total sales over quarterly installments through a joint bank account to be opened by the Saudi side. However, Structure Line breached the agreement terms by taking all the project’s down payments for itself, failing to pay dues worth EGP 175 mn to Misr Travel since April 2019.

What’s next? Structure Line will resume work on the project after obtaining all the necessary licenses from the concerned government bodies.


Gov’t says fourth wave incoming, opens new vaccination centers

The fourth wave of the pandemic is expected to accelerate in September amid the reopening of schools, the return of holidaymakers, as well as the prospective return of employees to working from the office, Noha Assem, and advisor to the health minister, told Extra News (watch, runtime: 9:17) last night.

Her remarks came as the Health Ministry reported 123 new covid-19 infections yesterday, up from 112 the day before.

Infections have now been on the rise for 23 days straight, save for a one-off drop on 5 August, according to our in-house covid tracker. Egypt has now disclosed a total of 285,700 confirmed cases of covid-19. The ministry also reported 8 new deaths, bringing the country’s total death toll to 16,638.

We’re getting new vaccination centers as part of the bid to vaccinate teachers and other school employees before the start of the new school year, with the Health Ministry saying it is now operating 657 facilities nationwide, up from the current 580. Health Minister Hala Zayed added in a statement yesterday that there are now 145 centers offering QR-coded certificates to travelers, up from 134.

A third COVID shot in ‘Murica: The Biden administration has confirmed that it will call on its 155 mn fully-vaccinated citizens to take a third coronavirus shot, amid fears of the delta variant and the long-term effectiveness of covid shots, the Wall Street Journal reports. From 20 September, people who have received the Pfizer and Moderna vaccines will be able to get the third shot. Studies on the long-term immunity of the Johnson & Johnson vaccine are still being conducted.

Tunisia eases covid-19 restrictions: The country’s curfew will be shortened to start at midnight and cafes and restaurants will be allowed to open until 10 pm, the Tunisian president stated yesterday. The news comes as case rates fall and the government’s vaccination campaign gathers pace.


I-Score has appointed Tarek Elmahmoudy (LinkedIn) as the managing director, effective as of last July, Youm7 reports. Elmahmoudy has 40 years of experience in the banking sector, and is an expert in IT, e-payments, and digital banking. Prior to this position, he was the CBE governor’s chief advisor of payment systems and information technology.

Ezzat Abou Zaid Salam has been appointed as head of the Administrative Prosecution Authority under a presidential decree published in Sunday’s Official Gazette, Masrawy reports. El Sisi was granted the power to appoint heads of four major judicial bodies — the Court of Cassation, the Council of State, the State Lawsuits Authority, and the Administrative Prosecution Authority — under amendments to the Judicial Authorities Act in 2017.



Last night’s (limited) talk shows were largely focused on diplomacy, as Intelligence chief Abbas Kamel headed to Israel to support Egyptian efforts in the peace process with Palestine, making stops in Tel Aviv and the West Bank’s Ramallah. During yesterday’s visit, Kamel shared President Abdel Fattah El Sisi’s invitation to Israeli Prime Minister Naftali Bennett for an official visit to Egypt within the next few weeks, which would be the first official visit by an Israeli leader to Cairo since January 2011, as we note in What We’re Tracking Today, above. Al Hayah Al Youm (watch, runtime: 4:43 | 1:14) had coverage of the visit.

Elsewhere: The Suez Canal Economic Zone (SCZone) is studying the prospect of establishing an industrial zone in East Port Said dedicated to the manufacturing of automotives, Chairman Yehia Zaki told Al Hayah Al Youm (watch, runtime: 25:50) last night, without disclosing further details. Cabinet greenlit in March 2020 an automotive strategy that would offer incentives, implement infrastructure improvements, and possibly establish Morocco-style industrial zones for vehicle manufacturing. The government has for years been attempting to stimulate automotive manufacturing through the planned automotive directive, a nationwide system of incentives and tariffs for manufacturing and exports for the auto industry.


It’s another human rights-focused day in the foreign press: AFP is running a piece on Islamists on death row in Egypt, while Reporters Sans Frontières is calling for the immediate release of four Al-Jazeera journalists, one of whom was arrested at Cairo airport earlier this month. Meanwhile, Xinhua is running a piece on Egyptian authorities foiling an attempt to smuggle 34 ancient coins out of the country.


Cabinet signed off (pdf) yesterday on the establishment of private sector education outfit CIRA’s Badr University in Assiut, with the company having completed the construction of the university’s first phase. It’s official opening is now pending a presidential decree and other operational approvals.


Powered by
EFG Hermes -

Crypto businesses are preparing for the regulatory axe to fall: Coinbase has stockpiled as much as USD 4 bn in reserves in its first months as a public company on the eve of closer regulatory crypto scrutiny, the Wall Street Journal reports. Buoyed by strong earnings of USD 1.61 bn in 2Q2021, compared with USD 32 mn in the preceding year, Coinbase’s cash balance amounted to USD 4.36 as of 30 June, about 4x higher than at the end of 2020, thanks to price volatility during the quarter that buttressed the company’s trading business. “We want to ensure that we maintain those cash reserves so that we can continue to invest and continue to grow our products and services in the event that we go into a crypto winter,” CFO Alesia Haas said.

Syria has suspended imports of 20 commodities and raw materials for six months in a move aimed at saving its declining foreign reserves for wheat purchases, Bloomberg reports. The list includes metal pipes and ceramics. The decision highlights the strain of rising crop prices on global buyers, especially for developing nations.




-0.2% (YTD: +0.6%)



Buy 15.65

Sell 15.75



Buy 15.65

Sell 15.75


Interest rates CBE

8.25% deposit

9.25% lending




-0.42% (YTD: +30.56%)




-0.46% (YTD: +52.51%)




+0.87% (YTD: +14.85%)


S&P 500


-1.07% (YTD: +17.15%)


FTSE 100


-0.16% (YTD: +10.97%)


Brent crude

USD 67.51



Natural gas (Nymex)

USD 3.85




USD 1,784.40




USD 44,683.33

-0.44% (as of midnight)


The EGX30 fell 0.2% at today’s close on turnover of EGP 2.3 bn (40.8% above the 90-day average). Foreign investors were net sellers. The index is up 0.6% YTD.

In the green: Raya (+2.8%), GB Auto (+1.6%), and Rameda (+1.0%).

In the red: Egyptian for Tourism Resorts (-4.0%), Fawry (-3.1%), and Eastern Company (-1.8%).

It’s a sea of red across Asian markets this morning, following Wall Street’s lead in response to US Fed minutes suggesting the central bank could start winding down stimulus later this year. US futures suggest Wall Street has a chance of opening in the green later today, but that European shares will come under pressure at the opening bell.


Iran is getting closer to weapons-grade uranium -IAEA: Tehran has achieved near-weapons grade uranium, according to a report by the UN’s International Atomic Energy Agency seen by Reuters. The nuclear watchdog says that Tehran has now refined the nuclear material to 60% purity, up from 20% in April, in a move that ratchets up tensions with the US and Europe as both sides try to resume talks to revive the 2015 nuclear pact.

Tensions between Turkey and UAE appear to be easing, with the two countries nearing an agreement for a UAE investment in Ankara, Reuters reports Turkish President Tayyip Erdogan as saying following “a rare meeting” with a senior UAE official. “If they continue in a good way with their counterparts, I believe the UAE will make serious investments in our country in a very short time,” Erdogan said, noting that the two specifically discussed the types of investments that could be made in different fields.


24 August (Tuesday): MEED will hold a webinar named Energy Transition in the Middle East.

26-28 August (Thursday-Saturday): Jackson Hole Economic Symposium.

September: Delegation of Russian companies to visit Russian Industrial Zone.

1-3 September (Wednesday-Friday): Digi Sign Africa, Cairo International Convention Centre, Cairo, Egypt.

2 September (Thursday): The new EGX mechanism for calculating closing share prices will come into effect.

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

5-7 September (Sunday-Tuesday): The Arab Security Conference, The Nile Ritz-Carlton, Cairo, Egypt.

7-8 September (Tuesday-Wednesday): Euromoney Conferences will host the GlobalCapital Sustainable and Responsible Capital Markets Forum 2021, featuring Vice Minister of Finance Minister Ahmed Kouchouk.

7-9 September (Tuesday-Thursday): Egy Health Expo, Al Manara International Conference, Cairo, Egypt.

9 September (Thursday): DevOpsDays Cairo 2021 is being organized by ITIDA and the Software Engineering Competence Center in cooperation with DXC Technology, IBM Egypt and Orange Labs.

12 September (Sunday): International schools begin 2021-2022 academic year

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.

21-22 September (Tuesday-Wednesday): The Federal Reserve meets to review interest rates.

22-25 September (Wednesday-Saturday): Cityscape Egypt, Egypt International Exhibition Center, Cairo, Egypt.

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.

October: New legislative session begins.

October: Romanian President Klaus Iohannis could visit Egypt in mid this month to discuss ways to boost tourism cooperation between the two countries.

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.

9 October (Saturday): Public schools begin 2021-2022 academic year

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.

31 October – 12 November (Sunday-Friday): The 26th UN Climate Change Conference, Glasgow, UK.

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

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.

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

2-3 November (Tuesday-Wednesday): The Federal Reserve meets to review interest rates.

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

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

7-8 December (Tuesday-Wednesday): North Africa Trade Finance Summit.

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.

14-19 December (Tuesday-Sunday): The Cairo International Festival for Experimental Theater.

14-15 December (Tuesday-Wednesday): The Federal Reserve meets to review interest rates.

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.

16 June 2022 (Thursday): End of 2021-2022 academic year for public schools

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; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.