AM — Here’s everything you missed this week while you’ve been on break for Eid El Fitr

Good morning, wonderful people. We know we said we wouldn’t be back in your inboxes until Sunday, but we missed you and thought we’d pop in with a quick update at the end of what we hope has been a very relaxing week for all of you. Think of today’s issue as a gentle orientation to where you are in time and space so that you can then slide into the weekend feeling on top of everything.

We hope you’re not as jetlagged from Ramadan as we still feel. Take heart: You have two more days in which to set things right.

We’re now about two months away from the dog days of summer — what are your top priorities for May and June? Drop us a line at editorial@enterprise.press and let us know.

What were the big, ongoing stories when last we wrote you? We went into Eid El Fitr with big stories including:

• The wait for news about ongoing talks on an IMF assistance package (there’s still nothing but the sound of crickets);
• President Abdel Fattah El Sisi’s late-month announcement that his administration is looking to net USD 40 bn in investment from the private sector over a four-year period through the sale of state-owned assets;
• El Sisi’s directive that we will see the sale of stakes in military-owned companies by the end of this year (remember: think this is more likely to be via stake sale than IPO);
• Multinationals pledged to invest bns to build green fuels plants in Egypt’s SCZone;
• Egypt is looking to capitalize on Europe’s booming demand for LNG — and we had sent our first cargo to Latin America;
• A top Bulge Bracket bank suggested inflation could hit as high as 17% this year (if transiently).

And that was just in the last week or so of Ramadan — it was NOT a quiet month. The “Ramadan news slowdown” was little more than vaporware: The month also saw ADQ invest USD 1.8 bn in blue-chip EGX-listed companies; the Madbouly government promise new regulations to make life easier for VCs and entrepreneurs building startups; tons of new funding announcements; and transport app Swvl make its Nasdaq debt — and pull the trigger on acquisitions. We could go on, but you remember now, right?

THE BIG STORY HERE AT HOME on this holiday week? Inflation. With no news coming from companies or government, the local press ran story after story running down lists of prices of everything under the sun. Which brings us, (not-so) oddly enough, to:

THE BIG STORY ABROAD- The US Federal Reserve raised interest rates 50 percentage points at its meeting yesterday, delivering its biggest rate hike since 2000 (but still short of speculation that it would go for a comparatively massive 75 bps hike). GCC economies that peg their currencies to the USD promptly followed suit.

And there’s more to come: “There is a broad sense on the [federal open markets] committee that additional 50 basis point increases should be on the table at the next couple of meetings,” Fed boss Jay Powell said at a presser following the announcement.

US markets cheered the news: The Dow rose 900 points in a “relief rally” sparked by the hopes of some investors that the Fed can find a way to slow inflation without causing a recession. Tech stocks were among the top gainers. Powell said the central bank is “not actively considering” raising rates in 75 bps increments

The move will make borrowing more expensive for everything from car to home finance.

The Bank of England is widely expected to do the same when it meets later today, going for its fourth straight hike after annual inflation in the United Kingdom hit a 30-year high of 7% in March thanks to (sing along with us now, everyone): Vladimir Putin’s war in Ukraine. The European Central Bank is also expected to follow suit when it meets in early June.

The Central Bank of Egypt meets two weeks from today on Thursday, 19 May to review rates.

The Fed’s hike is the lead story in the global business press: Wall Street Journal | Financial Times | Bloomberg | Business Insider | CNBC

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Among the other big international headlines worth knowing about:

BAD WEATHER IN INDIA COULD BE BAD NEWS for Egypt. India’s wheat output this year looks like it could fall for the first time after five consecutive record crops. India, the world’s second-largest wheat producer, is now looking to sell to Egypt for the first time, but crop yields were hit by a sudden spike in temperatures in mid-March. Expect to wait “some time” before we see the full extent of the hit — a best-case scenario seems to be a crop as large as last year’s, government officials suggest. Bloomberg and Reuters have more.

ACROSS THE OCEAN- An unprecedented leak from the US Supreme Court has ignited a furor as it appears a majority of its nine members have voted to overturn Roe v. Wade, a 49-year-old precedent that established the state had no right to bar women from seeking an abortion. An early draft of the court’s not-yet-official decision leaked to Politico.

AND- It seems MbS has made up with the guy who runs Turkey. Saudi Crown Prince Mohamed bin Salman met in KSA with Erdo a week ago tonight. MbS allowed himself to be publicly embraced by the Turkish president. Their years-long spat had less to do with the murder of journalist Jamal Kashoggi in Turkey than it did with Ankara’s bid under Erdogan to try to reshape Mideast affairs, including through its embrace of the Ikhwan.

MEANWHILE- Top European Union officials are looking to impose a phased oil embargo on Russian crude in what pundits are billing as the “toughest sanctions yet” on Moscow over its war in Ukraine. The bloc is also reportedly looking to ban Russians from buying European real estate.

Russia’s war in Ukraine shows no signs of ending soon. US intelligence agencies are reportedly helping Ukrainians kill Russian generals, according to the New York Times. Moscow had not, as of dispatch time this morning, reacted to the revelation. Meanwhile, Finland and Sweden are edging closer to applying for Nato membership.

DATA WATCH

GOOD NEWS ON THE FX FRONT- Suez Canal revenues hit a record high in April: Suez Canal revenues for the month of April reached USD 629 mn — the highest monthly gain in the canal’s history, according to a statement from the Suez Canal Authority that was widely picked up. Revenues in April were up 13.6% y-oy, the statement said. At least part of the boost in traffic through the canal is probably thanks to GCC oil producers sending more cargoes to Europe to make up volume taken off the market by Russia’s invasion of Ukraine.

Speaking of FX, the Finance Ministry raised the customs FX rate for imports of strategic goods to EGP 17.00 to the greenback starting 1 May, up from EGP 16.00 in April following the devaluation, according to a copy of rates issued by the Customs Authority and published by Al Mal.

SMART POLICY- The CBE topped the list of central banks raising their gold reserves in 1Q2022, purchasing up to 44.06 tonnes of gold during the quarter, according to data from the World Gold Council, which were released late last month. This brought Egypt’s total gold reserves to around 125 tonnes. Other big gold bugs include Turkey, India, Argentina and Ireland.

HAPPENING TODAY-

OPEC+ looks set to agree to a very small increase in June production when oil ministers from the expanded cartel meet later today. The group has been under pressure to more rapidly ramp up production. The embargo on Russian oil will likely see Western countries redouble pressure on KSA and the Emirates in a bid to get them to open the spigot, while producers including Nigeria and Angola have under-invested in both maintenance and exploration and production activity, meaning they have limited ability to pump and ship more.

OTHERWISE- Expect a whole lot of nothing, if the resounding silence of our inboxes / phones / WhatsApps is anything to go by. ????

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SIGNS OF THE TIMES-

Straight from the dumpster fire that is our social media:

Layoffs are starting on Panet Startup (in the United States), Axios reports. The media organization joins Benchmark venture capitalist Bill Gurley, who seems to smell it in the air, too, writing in a recent thread: “An entire generation of entrepreneurs & tech investors built their entire perspectives on valuation during the second half of a 13-year amazing bull market run. The ‘unlearning’ process could be painful, surprising, & unsettling to many. I anticipate denial.”

You’re going to face lineups at the Louvre / Empire State Building / Coliseum as operators gear up for a busy summer despite suggestions from public health officials that we’re seeing a new “silent” wave of covid-19. Airbnb’s sales for 1Q (and its 2Q forecast) point to “substantial demand” for travel. Indeed, the WSJ is telling us that (in the US, at leat) everyone is shopping, traveling and working out like it is 2019. Expect plenty of delays at the airport, Canada’s CTV writes.

Brokers, bankers and other finance types in the UK have seen their salaries spike 31% since the start of covid, prompting hand-wringing about wealth inequalities. Crack down on the bn’aires (do we really need bn’aires, decas in particular?) and then talk to us about that. There were 13 bn’aires in the United States back in 2022. There are at least 650 now — and some 2.7k of them globally, controlling tns in wealth.

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MORNING MUST READ- For tech and product nerds — and entrepreneurs hitting a certain stage in their growth stories: How technocrats triumphed at Apple, by NYT tech writer Tripp Mickle, who zeroes in on the departure of Apple design boss Jony Ive to suggest the tech giant has lost its soul. We’re not sure we’re on the same page as Mr. Mickle (there has to be some balance between thin-and-light and, say … ports and functional keyboards, both of which Ive destroyed), but we’ll hold our tongue until we have the time to read his book on this very same topic. After Steve: How Apple became a tn-USD company and lost its soul was released yesterday.

CIRCLE YOUR CALENDAR-

PSA #1- The FRA is merciful… Listed companies have until Tuesday, 31 May to file their 1Q 2021 financials, the Financial Regulatory Authority said in a statement (pdf) out before the Eid El Fitr break.

PSA #2- …and so is Mohamed Maait: Companies have until Sunday, 8 May to submit their corporate tax filings, after the Egyptian Tax Authority pushed the deadline to account for the weeklong Eid break. The previous deadline would have seen businesses file their returns on Saturday, 30 April.

PSA #3- It’s nearly (US and Canadian) Mother’s Day — it will be observed this coming Sunday.

REMINDER- Privatization strategy announcement next week. The Madbouly government is due to announce next week the outline of its strategy to privatize state-owned firms and boost private-sector participation in the economy.

The PSA world squash championships get underway in Cairo a week from tomorrow, with the first games set for Friday, 13 May. Play wraps up on 22 May. There is USD 550k at stake for each of the men’s and women’s championships, making this the biggest purse on record for a squash tourney.

NEWS TRIGGERS you’ll want to keep an eye on as this new month gets underway:

• The purchasing managers’ index for Egypt covering the month of April will be released on Sunday, 8 May. The indexes for Saudi Arabia and the UAE will be out the next day. Egypt’s private sector has been in contraction since November 2020. Expect further headwinds last month thanks in large part to fallout from Russia’s war in Ukraine.
• Foreign reserves: Figures for April should be announced some time next week;
• State statistics agency Capmas’ monthly bulletin covering the price of key building materials is due out on Monday, 9 May;
• Inflation figures for April are due out on Tuesday, 10 May. Between the global environment, knock-on effects from the devaluation of the EGP, and the traditional inflationary hit thanks to Ramadan, you can expect the number to be a bit on the ugly side.
• The Central Bank of Egypt’s monetary policy committee meets on Thursday, 19 May.

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

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Passenger car sales fell 3% y-o-y in March, according to figures from the Automotive Information Council (AMIC), an industry association to which most distributors report sales. AMIC data shows that around 18.9k cars were sold in March, down from 19.5k in the same period last year. That ends a run of growth that began last year. You can thank shortages of components, rising inflation, disruption to local production, a slowdown in imports, and the upward pressure on prices following the float of the EGP toward the end of March. Last year saw the sector shrug off the global chip shortage as strong demand pushed sales to their highest levels since the EGP float in 2016.

The breakdown:

• Total vehicle sales fell sharply: Overall, the auto industry sold 23.8k vehicles during the month, down 9.4% from last year.
• A massacre in truck sales: Truck sales saw the most significant drop out of any other segment, falling 32.9% y-o-y to nearly 3.2k.
• Bus sales extended their drop: Some 1.7k buses (historically, the worst performing segment) were sold in March, down nearly 16.6% y-o-y thanks to cutbacks in the tourism industry, which is reeling from the drop in Russian and Ukrainian tourists.

This was expected: The impact of the war in Ukraine on the industry — including soaring commodity prices, further supply disruptions and the EGP devaluation — was expected to be felt properly in March, industry insiders told us last month.

Car prices were rising — until the gov’t imposed caps: As of last month, car dealers were not able to hike prices above the price set by the official distributor. Dealers that sell at higher rates will face fines of up to EGP 2 mn. Many dealers have been hiking car prices, or refusing to sell at all, since the EGP devaluation. It’s not clear how long the price freeze will last.

AMIC data is self-reported by member distributors, who include the majority of (but not all) industry participants.

IN OTHER AUTOMOTIVE NEWS-

Is Mercedes-Benz interested in investing more in Egypt? Trade and Industry Minister Nevine Gamea met with Mercedes-Benz Egypt CEO Gerd Bitterlich on Tuesday to discuss the company’s current and future investments in Egypt, according to a ministry statement. Key points in the talks included discussion of the government’s automotive strategy (the updated version of the now-defunct automotive directive), which aims to increase local vehicle manufacturing and assembly and increase the sector’s competitiveness to become a regional manufacturing hub and bolster export volumes. Gamea stressed that this would be a government priority.

Want to read more on what the automotive industry wants to get out of the strategy? Read our inaugural Inside Industry story here.

The European Bank for Reconstruction and Development (EBRD) has confirmed that it is snapping up to USD 100 mn worth of Scatec’s USD 334.5 mn green bond issuance to refinance its six solar plants in Benban. The EBRD is also providing a USD 30 mn credit enhancement facility for participating institutional investors, the bank said in a statement (pdf) right before the Eid break. The 19-year issuance was fully snapped up by institutional investors, most of them development finance organizations, the Madbouly cabinet said last month.

Who else is getting in on the transaction? Development finance institutions subscribing to the offering include the US International Development Finance Corporation (DFC), the Dutch Entrepreneurial Development Bank (FMO), the German Investment Corporation (DEG), and a number of private global investors.

This is the first renewable energy, corporate green bond issuance in Egypt. CIB issued the country’s first private sector green bond last year with a USD 100 mn issuance supported by the International Finance Corporation, the proceeds of which were earmarked to finance green buildings.

That’s not all: “The EBRD will support the regional economic development of the Aswan governorate in the country,” the statement read. The bank plans on introducing a certified training program for agribusiness entrepreneurs in and around Benban, with a specific focus on youth and women.

Jane Brown, where have you been all our life? We like to think we know photography. How, then, to explain that we’ve missed Brown’s portraiture and street photography until now? Check our this roundup of some of her work in the Guardian from a few years back.

Speaking of amazing photographers: It is 50 years since David Hume Kennerly won the Pulitzer for feature photography with a portfolio heavy on images from Vietnam. Check out this post on his blog marking the anniversary this week — and look at the full portfolio of images here.

Why do we, as a species, seem to think about life in eight-hour blocks? Enter the Atlantic, which suggests it you may not be a mutant for sleeping less than eight hours a night. (Still, we don’t think it’s even slightly cool to brag about how little sleep you get.) And then Wired, which argues that the eight-hour workday is a counterproductive lie.

READ THIS NOW. Don’t wait. Just read it now. Wired founding editor Kevin Kelly has just turned 70 and is offering “103 bits of advice I wish I had known.” Missed his suggestions from previous birthdays? They’re here and here. Nearly 100% gold here, folks.

Wherein the Economist discovers that — gasp — not all Muslims fast.

And finally: The Saudi version of Capmas is asking that people kindly stop inviting its census takers in for tea / coffee / a little bite to eat (watch, runtime: 0:30). Arab culture at its best, y’all.

Do you want to build things for fun and profit — physical things, software things, creative things? You need to listen to Verge boss Nilay Patel (Twitter)’s most excellent interview with Tony Fadell (Twitter). Haven’t heard of Fadell? He played a pivotal role bringing to life the iPod and iPhone, went on to build a company called Nest that he sold to Google for USD 3.2 bn, and now runs an investment firm called runs Future Shape. The occasion? Fadell’s new book: Build: An unorthodox guide to making things worth making.

Bonus for fellow tech nerds and entrepreneurs: Patel writes that the book is “one part memoir, one part tech industry gossip, and one part org charts and decision-making. Seriously, this book has a lengthy section with actual diagrams of org charts to illustrate how company cultures change as things get bigger.”

LISTEN to the interview (runtime: 1:17:20) or read a condensed version of it here — or go check out the book on Amazon.

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Looking for something Egyptian-ish? The BBC podcast The Documentary’s latest episode spotlights the Grand Egyptian Museum. God keep us and save us from another piece by a foreign correspondent that opens with “I’m on my way now in a taxi to find the Grand Egyptian Museum. It’s about 10 km west of central Cairo and we get there down this road lined on either side by rough and ready concrete buildings that look like they’re half demolished or half built — and streams and streams of honking traffic.”

The episode skims the surface of what the GEM could mean for Cairo (and the country at large), but doesn’t go much deeper into what is set to become the world’s largest archaeological museum when it opens later this year.

Worth thinking about about: David Sims worries the GEM’s proximity to the new Sphinx International Airport could put Islamic Cairo, Coptic Cairo and “a lot of interesting architectural history completely off the beaten track.” We’re looking forward to visiting the GEM once again in person (we had a brief tour back in 2017) — and we’re optimistic that our great city has so much to offer that we’re not going to see folks turning Cairo into a day trip.

LISTEN and make up your own mind (runtime: 24:00).

Squash leads the conversation on Egypt in the international press, with the New York Times Magazine giving tons of play to US national Amanda Sobhy quest to become the first American to become the world’s top-ranked women’s squash player. Despite a couple of set-your-teeth-on-edge moments, the story is a must-read for anybody with an even passing interest in racquet sports.

Human rights coverage is still part of the landscape amid news that Alaa Abdel Fattah is on day 33 of a hunger strike (Washington Post).

Also making headlines:

• Media of the Masses, a new book by Dartmouth historian Andrew Simon, takes a deep dive into cassette culture in Egypt. Check it out on Amazon or get his rundown in this thread on Twitter.
• The East African has taken note of Egypt’s Indomie noodle recall.
• Egypt has a walk-on role in this obituary of Régine, who built a USD 500 mn global network of clubs back in the 1970s that spanned from New York to Paris and Cairo. (New York Times)
• Mosalsalat got headline treatment in the New York Times, through the lens of El Ekhteyar.
• Ancient ‘smellscapes’ are wafting out of artifacts and old texts. (ScienceNews)