Tuesday, 31 August 2021

EFG and sovereign fund get central bank nod for AIB acquisition

TL;DR

WHAT WE’RE TRACKING TODAY

Good morning, friends, and welcome to hump day — and the last day of August. It’s a day on which gadget geeks have to be feeling a bit itchy… Apple has not yet scheduled the September event at which it is expected to unveil the iPhone 13 (nerds seem to think it will take place on or around 14 September) — and now there are warnings that shortages of capacitors could see delays in everything from new computer gear to mirrorless cameras this fall. Throw in the spiraling price of aluminum…

THE BIG STORY ABROAD- America’s “longest war” is over after the last US plane took off from Kabul airport yesterday, completing the withdrawal of American forces from Afghanistan ahead of the 31 August deadline set by President Joe Biden. The US and its allies have evacuated as many as 122k people, including foreign nationals and Afghans deemed “at risk,” but have left behind thousands of Afghans who had aided Western countries, who could have qualified for evacuation, and who are in particular danger under Taliban rule. The US invaded Afghanistan 20 years ago this fall. The story is leading front pages everywhere in the foreign press from the Financial Times and Bloomberg to Reuters, the WSJ, the Washington Post and the New York Times.

The news from Afghanistan has effectively pushed business off the front page of even the top global financial publications this morning. Other stories getting attention today include the latest beats in the global covid-19 story, damage assessments after hurricane “Ida” slammed into Louisiana in the United States, and where oil is headed on the eve of the OPEC+ meeting.

A new electronic unified tax portal for companies should launch this September to companies in a limited number of tax jurisdictions in Cairo, allowing them to pay both VAT and income tax through a single platform, head of the Tax Authority’s Tax Jurisdictions division Sayed Sakr told Enterprise yesterday. The second phase of the launch should see the portal roll out to taxpayers in other areas, with the system expected to be operational nationwide by the end of June 2022.

A delegation of Russian companies is visiting the Suez Canal Economic Zone to discuss potential investments in the newly enlarged Russian Industrial Zone that will start taking shape by the beginning of next year. We have more in this morning’s news well, below.

IN MISCELLANY THIS MORNING-

Norway’s new ambassador to Egypt is happy to be here, with Hilde Klemetsdal tweeting a photo of herself at the Pyramids the other day. Another ambassador worth a follow: Canada’s Louis Dumas, who’s lighting up Twitter as he discovers Maadi staples including bakery Ratios and pizza joint What the Crust.

SMART POLICY(?), but good luck enforcing that here: China is limited kids to three hours of online gaming a week, with the Associated Press reporting that Beijing will limit “minors in China [to playing video] games between 8pm to 9pm on Fridays, weekends and on public holidays starting Sept. 1. That limits gaming to three hours a week for most weeks of the year”

You can’t buy leaded petrol anywhere in the world this morning: The UN marked yesterday the “official end” of the use of leaded fuel worldwide after the last supplies in Algeria were finally depleted last month, consigning the toxic fuel to history, the UN Environment Program (UNEP) office said in a press release. UNEP forecasts that the move — billed as a milestone for the global energy transition — will prevent more than 1.2 mn premature deaths every year and save the global economy USD 2.44 tn.

The iPhone is set to become your go-to emergency tool: Apple plans to add satellite capabilities to future iphones that will allow users to send emergency texts even without cell coverage, a person with knowledge of the matter told Bloomberg. The company will also introduce a tool allowing users to report major emergencies to the authorities, though neither feature will be ready before next year, adding that they could be changed or scrapped before release.

The news comes as iSheep such as ourselves are obsessing over how many (online only) events Apple will hold this fall — and when. The device maker is widely expected to launch the iPhone 13 alongside a redesigned Apple Watch and new AirPods, non-pro iPads and MacBook Pros at a series of events this fall, starting with a phone-focused event in September.

IN CASE YOU MISSED IT-

  • The Black Eyed Peas are coming to Egypt: They will be performing a one-off show at the Giza pyramids on 2 October.
  • Animals are shrinking in size, climate change is to blame: The phenomenon could have dire consequences on ecosystems all over the world and lead to the extinction of various species.
  • New Brandon Sanderson book: For all of you SciFi stans, make sure to check out Brandon Sanderson’s new book Lux (audio-exclusive) featuring super-powered humans and flying cities.

CIRCLE YOUR CALENDAR-

OPEC+ is meeting tomorrow, and oil producers are widely expected to continue reversing oil production cuts as oil prices recover, unnamed OPEC+ officials told Reuters. The meeting comes as US President Joe Biden urges oil producers to increase output, a request the cartel is likely to comply with, sources say. The news was confirmed by a Bloomberg survey.

Oil prices have been on a tear so far this year: Brent crude has surged more than 40% to USD 72.8 per barrel so far this year as global demand for fuel increases post lockdown.

Egypt hosts Digi Sign Africa this week: The three-day advertising and digital printing exhibition gets underway at the Cairo International Convention Centre on Wednesday, 1 September.

Cypriot prez visiting this week: President Nicos Anastasiades arrives in Cairo on Saturday, 4 September for a joint Egypt-Cyprus summit.

South Korea’s Defense Minister will be in town this week. The two-day visit by Suh Wook is the first of its kind to Egypt by a Korean defense minister. Suh’s meetings will include a sit-down with President Abdel Fattah El Sisi before the Korean minister moves on to Oman, the Korea Times reports. The expectation is that Suh’s visit will help lay the groundwork for a visit to Egypt by Korea’s president in early 2022.

And the key news triggers as we enter September:

  • PMI: August’s PMI figures for Egypt, KSA and the UAE will land on Sunday, 5 September.
  • Foreign reserves: The central bank will release foreign reserves figures for August sometime next week.
  • Inflation: Inflation data for August will drop either next week.
  • Interest rates: The Central Bank of Egypt will meet to review interest rates on Thursday, 16 September.

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 the wake of the most damning and dramatic report to date from the UN panel on climate change, we look at the report’s claim that the Mediterranean could be a warming hotspot — and ask how Egypt could respond if it finds itself at the molten center of the global climate crisis.

enterprise

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M&A WATCH

CBE OKs acquisition of 76% of AIB by EFG and SFE

CBE gives final thumbs up to Arab Investment Bank acquisition: EFG Hermes and the Sovereign Fund of Egypt (SFE) have gotten the final go-ahead from the central bank to purchase a 76% stake in the Arab Investment Bank, EFG said in a regulatory filing (pdf) yesterday. The two institutions will acquire the shares via a EGP 3.8 bn capital increase, giving EFG a 51% stake and the SFE 25%.

Who’s the seller? The National Investment Bank (NIB), which currently holds a 91.4% stake in the bank, will reduce its ownership to 24%, while minority shareholders with the remaining 8.6% will offload their stakes. EFG Hermes will subscribe to 423 mn newly-issued shares for EGP 6.03 per share, at a total value of EGP 2.55 bn. Meanwhile, the SFE will acquire 207 mn newly issued shares at the same per-share price totalling EGP 1.25 bn.

The transaction is expected to close before the end of the current quarter, EFG and SFE said earlier this year.

The acquisition marks Egypt’s first full bank privatization in 15 years — and the fact that the SFE has managed to pull it off helps prove that it’s serious about public-private partnership. The last time Egypt saw this kind of a sale was in 2006, when Bank of Alexandria was sold to Italy’s Intesa Sanpaolo. Government privatization schemes stall regularly, with a central bank plan to sell off United Bank apparently on hold for now. That makes the acquisition even better news for the SFE — as one Goldman Sachs analyst told Reuters back in May, it “signals an improved capacity by the government to follow through on privatisation plans after a patchy track record, which is largely down to the establishment of the [SFE].”

It’s been a long road: EFG and the SFE began due diligence on AIB in June 2020, after receiving clearance from the CBE. The transaction has been through several rounds of approvals, getting the green light from EFG Hermes’ board in April, from the cabinet in May, and now finally from the central bank.

INVESTMENT WATCH

Work on the RIZ to start by early 2022

The Suez Canal Economic Zone will begin work on the new and improved Russian Industrial Zone (RIZ) by the beginning of next year, SCZone head Yehia Zaki said (pdf) today during a meeting with a delegation of Russian companies interested in setting up shop in Egypt. Infrastructure work on the zone will begin in early 2022 at the latest following the signing of a contract that will create a company to manage the RIZ, he said. Zaki told Russian media earlier this year that the zone would be implemented before the end of 2021.

A bigger, better RIZ: The two countries recently agreed to expand the area of the Russian zone, granting it an additional 5 mn square meters distributed between east Port Said and Ain Sokhna. The RIZ also marks Russia’s first industrial zone outside its borders and it will enable the country to be present in African and regional markets. July’s agreement also allows Russian companies to sell up to 100% of their locally-made products in the Egyptian market.

The Russians are in town: The delegation, which includes a number of officials along with representatives of Russian companies, are examining land and discussing with officials the potential for investment.

TRANSPORT

Thomas the Tank Engine would be proud

Multi-bn high-speed electric rail contract set to be signed with Siemens-led consortium this week: The National Authority for Tunnels is due to sign a contract within the coming days with a Siemens-led consortium that also includes Orascom Construction and Arab Contractors to build a USD 23 bn high-speed electric rail network, according to a Cabinet statement yesterday. The agreement — greenlit by the Cabinet in June — would see the three companies design, install and commission the rail system — which could span a massive network of up to 1.7k kilometers, with the project’s first 460-km phase connecting Ain Sokhna to Alamein via the new capital. The consortium signed an MoU with the authority earlier this year.

Who’s doing what? Siemens will be responsible for all things electrico-mechanical, including installing the signaling system, power infrastructure and a control center, as well as producing 34 passenger and 10 goods carriages for the project’s first phase, Transport Minister Kamel El Wazir previously said. Together, the three companies will be responsible for the design, installation, and commissioning of the rail system.

Where will the new electric rail go? The project’s first 460-km phase will connect Ain Sokhna to Alamein via the new capital. The second phase is expected to connect Alamein to Marsa Matrouh, the third Hurghada, Safaga, Qena and Luxor, while the fourth should run from Sixth of October further west. The entire network was initially expected to span nearly 1,000 km, though Transport Minister Kamel El Wazir later said on the airwaves that it would span 1,750 km in total.

MARKETS

Egycomex to go live in 1Q2022

Egypt’s long-awaited commodities exchange (Egycomex) is set to start full operations in 1Q2022, Ibrahim Ashmawy, head of the Internal Trade Development Authority and chairman of the new exchange, told Akhbar Al Youm. The commodities exchange began trading on a pilot basis this past spring to coincide with the start of the wheat harvest, prior to which some 450 wheat collection points were established across the country for farmers wishing to offer their harvest on Egycomex, Ashmawy noted.

A twinning grant contract is set to be signed with the Belarusian Universal Commodity Exchange (BUCE) to benefit from its expertise in database building, membership requirements, and trading commissions in the mercantile exchange market, Ashmawy said, without specifying a timeframe. BUCE is billed as one of the largest spot exchanges in Eastern Europe, with an annual turnover of about USD 2.3 bn.

Where do things stand? The law governing the forthcoming Egyptian commodities exchange — which has been in the works since February 2018 when it was made possible after amendments made to the Capital Markets Act — should now be in the hands of the House of Representatives after receiving cabinet approval last year. Ashmawy had previously told us that traders would be able to buy and sell wheat, oil, sugar, and rice when the exchange launches, and said in a separate interview that gold, steel and cotton would be added later.

COVID WATCH

Vacsera’s new facility to open November 2021

Vacsera’s new facility to manufacture covid vaccines is set to open at the end of November, Prime Minister Moustafa Madbouly said during a visit to the factory yesterday. The plant, based in Sixth of October, will produce 3 mn doses every day, or 1 bn doses annually.

Vacsera aims to produce 15 mn doses of Egypt-made Sinovac jab this month, with an eye to rolling out as many as 40 mn shots by year’s end, Vacsera head Heba Waly told Al Hayah TV (watch, runtime: 6:37) last night. Vacsera is looking to produce 24k shots each hour, Waly told Salad El Balad TV (watch, runtime: 4:42). The Health Ministry began last week the roll out of the first 1 mn doses of the home-made shots, with plans to ramp up capacity to produce 15-18.5 mn each month, Health Minister Hala Zayed previously said.

An export hub for Africa? Madbouly reiterated Zayed’s statement last week that the factory aims to position Egypt as a vaccine-making hub for export to the rest of Africa. Among those vaccines will be one that is “recognized in 100% of countries” through a partnership with an unnamed Europe-based vaccine maker, Zayed said previously. Madbouly said that negotiations were at an advanced stage with a number of international companies on vaccine production, adding that he hoped an agreement would be reached by the time the factory becomes operational.

The Health Ministry reported 263 new covid-19 infections yesterday, up from 255 the day before. Egypt has now disclosed a total of 288,162 confirmed cases of covid-19. The ministry also reported 6 new deaths, bringing the country’s total death toll to 16,727.

IN GLOBAL COVID NEWS-

New South African variant shows worrying mutations: South African scientists have published a study on a new coronavirus variant known as C.1.2. First discovered in May in the South African provinces of Mpumalanga and Gauteng, home to Johannesburg and Pretoria, the new variant has now been detected in seven further countries. The scientists said its specific spike mutations resemble those of other troubling variants and could make it more transmissible and better at dodging antibodies, potentially rendering vaccines less effective.

Americans could lose their European vacations as the US has been removed from the EU’s “safe list” of countries amid a resurgence of covid-19 cases across the country, Reuters reports. While the guidance, which also now applies to Israel, Kosovo, Lebanon, Montenegro and the Republic of North Macedonia, is non-binding for EU 27-member nations, the European Union is set to encourage members to reinstate travel restrictions such as quarantine and PCR testing, especially for non-essential travel, for unvaccinated US visitors, EU officials tell the New York Times.

MOVES

ACA head reappointed for another year

Hassan Abdel Shafi Ahmed has been re-appointed for another year as head of the Administrative Control Authority effective yesterday, per a presidential decree published in the Official Gazette (jpg) on Sunday. Ahmed was first appointed a year ago in August.

EARNINGS WATCH

Banque du Caire’s net income, revenues grow y-o-y in 1H2021

Banque du Caire’s (BdC) net income grew 7% y-o-y in 1H2021 to EGP 1.8 bn, up from the EGP 1.7 bn (pdf) recorded in the same period last year, driven by a 3% y-o-y rise in net interest income to more than EGP 5 bn, according to an earrings release seen by Hapi Journal. The state-owned bank’s operating revenues followed suit with a 4% growth and reached EGP 6.1 bn during the January-June period, compared to EGP 5.9 bn a year before, thanks to an 18% hike in net fee and commission income.

Reminder: BdC is a perennial IPO candidate, having most recently been informed by the Financial Regulatory Authority of a new deadline to complete its debut on the EGX by the end of the year. BdC had been poised to go public in April this year as part of the state privatization program, but the pandemic disruption forced the bank to shelve plans. The bank was hoping to raise some USD 500 mn in what was expected to be the country’s biggest sale of state assets since 2006.

enterprise

ENTERPRISE+: LAST NIGHT’S TALK SHOWS

Two topics reigned supreme on the nation’s airwaves last night: Prime Minister Moustafa Madbouly’s visit to state-run Vacsera’s Vaccine City in Sixth of October — set to be up and running in November, as well as Foreign Minister Sameh Shoukry’s participation in a ministerial-level meeting of Libya’s neighbors in Algeria, aimed at reaching a political resolution to the conflict between Tripoli’s unity government and eastern Libyan leader Khalifa Haftar. We delve into the nuances of both in this morning’s Covid Watch (above) and Diplomacy (below) sections.

Vaccine city coverage: Al Hayah Al Youm (watch, runtime: 4:36), Masaa DMC (watch, runtime: 2:17) and Ala Mas’ouleety (watch, runtime: 7:12) had coverage of Madbouly’s visit to the vaccine facility.

Coverage of Libya meetings: Al Hayah TV’s Lobna Assal (watch, runtime: 6:40) and Sada El Balad’s Ahmed Moussa (watch, runtime: 8:42) analyzed the behind the scenes of Shoukry’s back-to-back meetings with foreign ministers in Algeria.

EGYPT IN THE NEWS

Human rights is leading the international press again: Authorities released on Sunday three public figures who had spent over a year in pre-trial detention, the Associated Press reports. YouTuber Shadi Srour, journalist Shaima Sami and activist Ziyad Aboel-Fadel were all freed in the latest spate of releases. The releases came a day before a Cairo court announced it had dropped charges against four NGOs in the longstanding foreign funding of civil society case. Both moves should help ease a perennial pain point for Egypt in its relationship with some of its major Western partners.

From the Dept of “There Goes Your Diet”: Krispy Kreme’s recent expansion into Egypt is getting ink from Bloomberg, which notes “the doughnut-maker expects to open up to 10 stores in Egypt in the next 12 months” as part of its global expansion drive.

Egyptian tennis star Mayar Sherif exited the US Open with her first-round loss to Anhelina Kalinina. You can catch highlights of the match on the US Open’s Youtube channel (watch, runtime: 3:02). Sherif became the first Egyptian woman to qualify for the event’s main draw after a qualifying match against American Clervie Ngounoue, King Fut notes.

ALSO ON OUR RADAR

Raya FutureTECH has joined the Global Accelerator Network (GAN), it announced in a statement (pdf). Operated by Raya Holdings subsidiary Raya Customer Experience and VC outfit Openner, the accelerator will organize a training camp in early September to select startups for the first phase of the program, which could see EGP 1 mn handed out to 10 startups. The first phase will kick off in October and runs for three months.

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

  • Egypt’s Trade Ministry is on course to build 317 small-scale industrial complexes across 17 villages nationwide, as part of the state’s Decent Life initiative, Minister Nevine Gamea told Sada El Balad TV (watch, runtime: 18:18).

PLANET FINANCE

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Aluminum prices are touching highs last seen a decade ago, buoyed by strong demand from buyers rushing to line up metal can, aircraft and building material shipments, the Wall Street Journal reports. Prices are currently almost 80% higher than their low point in May 2020 — when sales to the aerospace and transport industries took a hit in the depths of the pandemic. The sticking point, however, is that higher prices are pinching companies in the US and Europe, where it has been difficult to secure the metal that is mostly idling in Asia. The container supply shortage has further exacerbated the issue, leading to a situation in which “there’s just not enough metal inside of North America,” one industry player says.

First a global chip shortage, now an undersupply of capacitors used in electronics: Asia is facing the prospect of a drop in production of multilayer ceramic capacitors (MLCCs) — high-performance capacitors that regulate the flow of electricity in everything from iPhone and PlayStations to electric cars — after two of the major manufacturers in Japan and Malaysia had to suspend some operations due to new covid-19 outbreaks, writes the Wall Street Journal. The MLCC situation is, however, being kept under control by the global semiconductor supply crunch, as hampered production at chip factories has kept a lid on demand for these ceramic bits as car companies cut production.

Inflation in Germany is at its highest level in 13 years, with the country’s consumer price index rising to 3.4% y-o-y in August driven by an economic rebound, supply chain disruptions, and higher energy prices, the Financial Times reports. Manufactured goods in particular saw inflation rise to 5.6% off the back of supply shortages, while service inflation came in at 2.5%. The price growth in the EU’s largest economy could feed into the European Central Bank’s discussions next week on whether it will scale back its bond buying program, though the ECB has said it expects inflation to fade next year.

Up

EGX30

11163.23

+0.5% (YTD: +2.9%)

None

USD (CBE)

Buy 15.65

Sell 15.75

None

USD at CIB

Buy 15.65

Sell 15.75

None

Interest rates CBE

8.25% deposit

9.25% lending

Up

Tadawul

11,255.05

+0.7% (YTD: +29.52%)

Up

ADX

7,684.87

+0.4% (YTD: +52.32%)

Down

DFM

2,899.84

-0.05% (YTD: +16.37%)

Up

S&P 500

4,528.79

+0.4% (YTD: +20.57%)

Up

FTSE 100

7,148.01

+0.3% (YTD: +10.64%)

Up

Brent crude

USD 73.22

+0.7%

Down

Natural gas (Nymex)

USD 4.32

-1.7%

Down

Gold

USD 1,812.30

-0.4%

Down

BTC

USD 47,332.59

-3.77% (as of midnight)

THE CLOSING BELL-

The EGX30 rose 0.5% at yesterday’s close on turnover of EGP 2.1 bn (30.5% above the 90-day average). Local investors were net sellers. The index is up 2.9% YTD.

In the green: Heliopolis Housing (+5.6%), Cleopatra Hospitals (+4.7%) and EFG Hermes (+3.4%).

In the red: Mopco (-3.3%), MM Group (-3.1%) and Fawry (-2.7%).

Asian markets are solidly in the red this morning, and futures point to a mixed open in much of Europe and North America later today.

DIPLOMACY

Egypt and Algeria pledged to continue to push for a resolution in Libya by attempting to reach a political settlement between Tripoli’s unity government and eastern Libyan leader Khalifa Haftar, in a meeting between Foreign Minister Sameh Shoukry and his Algerian counterpart Ramtane Lamamra yesterday in Algeria. The two ministers also agreed to continue improving bilateral ties and cooperation between Egypt and Algeria, Shoukry said in a press conference (watch, runtime: 1:37).

Shoukry is on a two-day visit to Algeria to attend a ministerial-level meeting of Libya’s neighbors, during which he called for the holding of “comprehensive and credible” national elections in Libya — according to a roadmap agreed on by both sides — that would put an end to the transitional period that saw conflict between the unity government and other Libyan factions. The FM also sat down separately with Libyan Foreign Minister Najla Mangoush and his Sudanese counterpart Mariam Al Mahdi.

greenEconomy

Is Egypt in the eye of the storm that is the global climate change crisis? The UN’s panel on climate change has put the globe on Defcon 4 with its most recent report on global warming. The global rise in temperature is causing rapid, unprecedented and in some cases irreversible changes to the climate in every region of the world. It’s the first global report to be released by the Intergovernmental Panel on Climate Change (IPCC) since 2013, and the first to definitively state that human activity is “unequivocally” to blame for planetary heating.

It’s not looking good for us: And while Egypt specifically has not been named in the report, the IPCC has dire warnings for our region, saying it is among the most vulnerable to the impact of climate change. Today, we dissect the report and compile data to analyze just how vulnerable Egypt is to the mercury rising.

“The Mediterranean is expected to be one of the most prominent and vulnerable climate change hotspots,” the report notes, adding that it could say with “high confidence that the projected Mediterranean summer temperature increase will be larger than in the global mean,” potentially by up to 50%.

Daily temperatures in Egypt have increased by around 1.3°C since 1960, with the current rate of increase standing at about 0.4°C per decade, according to a 2019 study co-authored by scientists from the Egyptian Meteorological Authority (EMA), Egypt’s National Research Centre, Cairo University and two Paris labs. If that’s the case, the weather has already been getting hotter than the global average, faster than the global average.

If nothing is done to curb emissions, Egypt could see runaway warming: In a scenario where serious efforts are made to reduce carbon emissions, the local researchers predicted that warming in Egypt would keep pace with the rest of the world. But in a worst case, business-as-usual scenario, maximum temperatures were projected to rise by a whopping 5.6°C in Aswan by 2090, and 3.5°C in Alexandria. In that hypothetical scenario, 80% of days would be “extremely hot” across the country by the end of the century, compared with a current 10%.

The scientists were keen to stress that Egypt’s temperature data records are patchy, making it difficult to produce accurate models; and the paper references the global temperature data and future scenarios outlined in the last IPCC report in 2014, which now need updating in light of the UN body’s latest study.

Drought worries have for some time weighed on Nile Delta farmers, some of whom have been struggling for years to water their crops in the summer.

Countries with less efficient agricultural systems will also see their food supplies hit the hardest by rising temperatures, with the FT recently highlighting a study showing that Egypt’s wheat production would drop 7% on the back of a 1°C rise in temperatures—bad news for the world’s largest wheat buyer as it looks to boost domestic supply.

But heat is far from the only problem: The UN report warned that “most sandy coasts” are highly likely to see more and worse coastal flooding and erosion, while coastal cities can expect increased flooding as the result of extreme sea level events and higher rainfall. That’s worrying for agriculture in the Nile Delta, for Egypt’s Red Sea and Mediterranean tourism industry, and for residents of its second city, Alexandria, where huge storms and flooding have become a winter staple. State attempts to tackle the problem have so far included dropping 4,700 concrete blocks into the water around the Alexandrian citadel of Qaitbay to protect its historic monuments from the rising waters.

The dangers of coastal erosion extend farther than we perhaps care to remember: we’ve known for over a decade that the whole of the Nile Delta is sinking beneath us in tandem with the Mediterranean’s rise, as the result of subsidence caused by damming and saltwater intrusion. That could spell disaster for agriculture as well as for livability in the densely populated area.

What will become of us? “Global warming of 1.5°C and 2°C will be exceeded during the 21st century” unless drastic cuts are made to CO2 and other greenhouse gas emissions in the coming decades, the IPCC report warns, adding that surface temperatures are already locked in to rise until at least 2050 in all scenarios. That 1.5°C figure has long been considered the hard ceiling on acceptable levels of warming, beyond which the consequences would be (even more) dire.

And what are we doing about it? Egypt is targeting generating 42% of its energy from renewable sources by 2035, and initiatives to aid the transition to a green economy have been backed by hefty funding. The past year has seen the country issue its first sovereign and corporate green bonds, while the European Bank for Reconstruction and Development (EBRD) has offered tens of mns in EGP loans to banks for on-lending to green SMEs. The government has emerged as a strong advocate of electric vehicles, with plans in the works to locally manufacture electric cars, buses and trains, as well as to invest in the necessary charging infrastructure.

But while these will help minimize Egypt’s contribution to global greenhouse gas emissions, mitigation and adaptation will be crucial. The government is aiming for better management of finite resources through new legislation like the Water Resources Act. It has begun overhauling our ailing water infrastructure, which leaks bns of cubic meters. We cover these efforts in greater detail here, here and here.

NEXT WEEK- Let’s hope these work before this becomes common: Egypt’s mango and olive farming has seen better years, with production falling 20-25% this year. Agriculture industry people we’ve spoken to attribute the shift to climate change. We look at how bad our mango and olive industries have been hit by climate change, and what efforts are being done on the ground to mitigate these problems.


Your top climate stories for the week:

  • World Bank meeting: Environment Minister Yasmine Fouad sat down with World Bank officials to discuss conducting studies on the effects of climate change in Egypt.
  • “Green road” coming to Wadi Al Hitan: The new 34-kilometre road will supposedly be constructed using recycled materials and will preserve the natural colour of the soil.
  • Sovereign wealth funds not giving enough attention to ESG: Global sovereign wealth funds need to up their rate of investment in ESG-compliant projects to offset the current speed of climate change, a former UN official said.
  • Saudi green plans yet to materialize: The kingdom’s carbon-zero, hydrogen-powered The Line project, as well as the world’s largest solar park have yet to get off the ground.
  • Debt is pricier with poor climate performance: Recent research has shown that countries that perform poorly on transitioning to a low-carbon economy are prone to suffering from increased sovereign borrowing costs.

CALENDAR

24 August-5 September (Tuesday-Sunday): Tokyo 2020 Paralympics.

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

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

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

4 September (Saturday): The first Egypt-Cyprus Intergovernmental Summit is taking place in Cairo.

5 September (Sunday): The updated date for EGX listed companies to institute the new mechanism for calculating closing share prices. The deadline was previously 2 September.

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.

8-9 September (Wednesday-Thursday): Egypt-International Cooperation Forum (ICF), Cairo

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.

11-12 September (Saturday-Sunday): International Conferences on Economics and Social Sciences, Cairo

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.

13-21 September (Monday-Tuesday): 76th session of the general assembly, New York

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.

18 September (Saturday): Expiration of United Nations Investigative Team to Promote Accountability for Crimes Committed by Daesh/ISIL

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 — must be held by the first Thursday of October.

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.

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.

16-17 November (Tuesday-Wednesday): Africa fintech summit, Cairo.

26 November-5 December (Friday-Sunday): The 43rd Cairo International Film Festival.

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.

22-24 April 2022: World Bank-IMF spring meeting, Washington D.C.

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.

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