Sunday, 25 September 2022

AM — Central Bank of Egypt leaves rates on hold against expectations



Good morning, friends. We’re back in Omm El Donia after a week in Dubai — and reveling in the fact that it is now fall (ie: The Official Favorite Season of Enterprise). The national weather service tells us that Friday was the autumnal equinox, meaning we’re in for about 89 days of the pumpkin spice season.

We have a big issue for you this morning, but before we get started:

Today is also our birthday. Enterprise turns eight this morning. We sent the very first (public facing) version of Enterprise to 50 people (you can see it here — feel free to chuckle, but you can see traces of our DNA in there). Our August 2022 readership figures show that there are now 215k of you out there who choose to regularly start your mornings with us, whether on email or the interwebs.

What were we writing about eight years ago this morning? Renewable energy was just becoming a thing in Egypt as we prepared for a UN climate summit — and CBS had released a teaser for President Abdel Fattah El Sisi’s first televised interview in America. The EGP was weakening (oh, for the days of EGP 7.44…) and we still had daylight saving time.

A huge thank you this morning to the folks who keep the A/Cs and lights on around here. Everything we do is made possible — and available to our readers without charge — thanks to the generous support of:

  • EnterpriseAM: HSBC Egypt | EFG Hermes | SODIC | Infinity | SomaBay | Moharram & Partners
  • EnterprisePM: Palm Hills Developments | Etisalat Misr
  • Enterprise Climate: HSBC | Infinity Power
  • Our industry partners: CIRA | Orascom Construction | Infinity | Industrial Development Group | EFG Hermes

Thanks also this morning to everyone who has ever written us, sent in a correction or note of encouragement, recommended us to a friend or colleague, said something nice about us, or otherwise done something to help build this amazing community. Writing to you each morning is the highlight of our professional lives — thank you, one and all.

SIGN OF THE TIMES- Overheard at the customs lineup at Cairo International Airport, terminal 3, on Thursday evening:

“Uh, sir? What are the chunky metal things in your bag?” asks the Finance Ministry guy running the X-ray machine. He’s only mildly curious and is gesturing with his hands that the offending items are “about this big.”

“Break pads.”

“Oh, thank you. Go right ahead.”

HEY, EGYPTAIR — YOU READING THIS MORNING? The business class cabin crew of MS 913 on Thursday, 22 September? Simply excellent.


Is the Madbouly government holding an economic conference this week? After two weeks’ of chatter about a three-day economic conference at the end of the month, we’re still none the wiser about what the plan is — or whether it’s even taking place. A number of government officials (here, here, here) have appeared on the airwaves in recent days to talk about the agenda — from what we know, the government’s privatization strategy and import substitution industrialization would be two of the main topics of discussion — but key details such as date and location are TBD.

Our friends at HSBC are hosting an energy transition webinar series this Tuesday through Thursday (27-29 September). The series will look at the “latest climate analysis in relation to the global energy market and transition to net zero” in six different sessions covering energy security, what is required to ensure the success of COP27, financing and investment needs for the energy transition, and the scaling up of renewables in the region, among other topics. You can register for the series here.

A Spanish business delegation will be in town this Tuesday and Wednesday (27-28 September) for the Egypt-Spain Multilateral Partnership Forum, organized by the Spanish Institute for Export and Investment, according to a press release (pdf). The two-day conference will include seminars and panel discussions on trade and investment in transport, energy, and water with Egyptian ministers and representatives from government bodies, alongside officials from international financing institutions and Spanish Secretary of State for Trade Xiana Méndez Bértolo. The agenda for the conference is available here (pdf).

The Africa Women Innovation and Entrepreneurship Forum will take place at the Cairo Marriott Hotel on 26–27 September.


Our elected representatives will return from Sahel to start the new legislative session in the House on Saturday, 1 October, according to a presidential decree in the Official Gazette. Senators will return for the opening session on Tuesday, 4 October next week.

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


It’s a mixed picture in the international front pages this morning:

  • Protests in Iran are getting coverage in the New York Times and Reuters.
  • The latest from Ukraine and Russian FM’s Sergei Lavrov’s appearance at the UN General Assembly are getting attention from Bloomberg, the Associated Press and Reuters.
  • The negative market reaction to the UK government’s Reaganite turn earns a place on the front-pages of the Financial Times and CNBC.
  • Also: The Wall Street Journal reports that US pension funds are staring at more heavy losses at the hands of private equity investments, while the Washington Post looks at the Trump-DeSantis rivalry that will set the tone for the battle for the Republican presidential nomination.


COUNTDOWN TO COP27- Expect a whole lot of green financing agreements at COP: The government will announce a number of green financing allocations in partnership with Japan, China, the European Investment Bank and the European Bank for Reconstruction and Development, on the sidelines of COP27 in November, International Cooperation Minister Rania Al Mashat told Bloomberg Asharq (watch, runtime: 4:59). The financing will target sustainable development and green transportation projects, she said.

“Who pays for the climate crisis”: Developing nations are taking aim at the IMF and the World Bank. The question that is quickly coming to dominate the conversation in the lead-up to COP is now being turned on the Bretton Woods institutions — the IMF and the World Bank — by developing nations who are arguing that the post-war global financial system may no longer be fit for purpose, as rich nations fail to meet their climate finance pledges and ignore pleas for debt relief. During her speech at the UN General Assembly, Barbados Prime Minister Mia Mottley said the IMF and the World Bank “no longer serve the purpose in the 21st century that they served in the 20th century,” and called on international lenders to offer sustainable, long-term financing for poorer nations struggling with the effects of climate change, the pandemic and the economic crisis caused by the war in Ukraine.

WATCH THIS SPACE- Could Egypt host the Olympics? Egypt will bid to host the 2036 Olympics, the Youth and Sports Ministry said Saturday. President Abdel Fattah El Sisi approved a request to apply to host the competition, Youth and Sports Minister Ashraf Sobhy said yesterday follow[ing a meeting with International Olympic Committee President Thomas Bach in Cairo.

Who could we be up against? It’s still early in the bidding process, but several countries including Turkey, Mexico, Indonesia, India, and the UK are reportedly interested in bidding for the games.

We’ve been after all the major sporting events: Egypt, Saudi Arabia and Greece are rumored to be in discussions to mount a joint bid for the 2030 World Cup.


The Somabay Endurance Festival, organized by The TriFactory, returns this month for the fourth time. Featuring four different races that combine swimming, cycling, and running, as well as the 1K Kids Race (ages 5-10) and the 10K Race, the Somabay Endurance Festival has got something for everyone. Taking place from 29 September though 1 October, spots are running out for Egypt’s favorite multi-sport event. To find out more and sign up, head to


CBE (kind of) bucks the global tightening trend by leaving rates unchanged

CBE reaches for another tool in the toolbox: The Central Bank of Egypt (CBE) left interest rates unchanged on Thursday, a move that went against market expectations. The Monetary Policy Committee (MPC) left the deposit rate at 11.25%, the lending rate at 12.25%, and the main operation and disc. rates at 11.75%, it said in a statement (pdf) following its policy meeting. Almost all analysts surveyed by Enterprise ahead of the meeting expected the central bank to hike rates in a bid to curb rising inflation and the weakening EGP, with most forecasting a 100-bps increase. This is the third consecutive time that the CBE has held rates steady, and the second meeting with Hassan Abdalla at the helm.

Tightening by other means: The central bank bumped up its reserve requirement for all banks to 18% from 14% currently, which it said would “complement the tightening stance that the CBE is maintaining.” The reserve ratio regulates how much capital commercial banks are required to hold in their reserves. By raising the ratio, the central bank is aiming to restrict lending, tighten financial conditions, and support the currency — all without raising the cost of borrowing for the government or the private sector.

What they said: “The MPC concurs that the current key CBE rates coupled with the increased required reserve ratio are consistent with achieving price stability over the medium term,” the CBE said. The central bank reiterated that it will “temporarily tolerate” inflation above its target of 7% (±2%) on average in 4Q 2022 as it continues to assess the impact of the 300 bps worth of hikes made earlier this year, and again stressed that price hikes are the result of external supply-side pressures resulting from the war in Ukraine. Inflation increased to 14.6% in August, its highest level in more than 3.5 years on rising food prices.

Why not raise rates? Hiking interest rates is unlikely to bring foreign investors back into the carry trade amid rising US rates and uncertainty about the EGP, nor would it do much against the impact of imported inflation. Another rate hike would have also raised the government’s borrowing costs and put more pressure on the budget, said Pharos' Esraa Ahmed, who was the only analyst in our poll to forecast a hold. “The central bank chose the most appropriate solution to contain inflation during this stage and manage liquidity instead of directly raising the cost of borrowing, which would have raised the cost to the state budget significantly,” she said.

But pressure for action could be greater in the next meeting, according to economist Mona Bedeir, who before the meeting predicted a 100-bps hike. Leaving rates on hold “will translate to more pressure on exchange rates and higher monetary tightening expectations in the coming meetings,” she told Bloomberg Asharq (watch, runtime: 00:40).

A win for Team Deval in November? BNP Paribas expects the central bank to hike rates by 100 bps at its next meeting in November alongside a devaluation of the currency ahead of an agreement with the IMF. “We think the next rate hike is likely to be deployed in tandem with a surprise devaluation of at least 10%, which would help achieve convergence with the parallel market rate,” BNP Paribas MENA economist Mohamed Abdelmeguid wrote in a note last week.

The bank expects the EGP to fall to 22-23 against the greenback by the end of the year and the central bank to raise rates by another 200 bps by its December meeting.

So far, so gradual: The EGP has been on a slow decline in recent weeks, falling almost 2% since Hassan Abdalla was appointed to head up the central bank in mid-August. The currency has fallen nearly 24% since the devaluation in March to stand at around EGP 19.52 as of this morning.

New inflation targets ahead? The central bank will announce new inflation targets soon, a CBE source told CNBC Arabia. The central bank is currently targeting a 7% (±2%) rate of inflation, far below the 14.6% urban rate in August.

While the CBE held steady, central bankers everywhere pushed forward with tightening: Analysts were expecting the CBE to follow through with a rate hike in response to the Federal Reserve’s third successive jumbo-sized 75 bps rate hike last Wednesday, which the Fed signalled was a bid to tame inflation and external growth risks. A number of major central banks hiked rates last week following the Fed decision, including those of Switzerland and the UK.

The story got attention in the foreign press: Reuters | Bloomberg.


It could take another month or two to finalize IMF support -Maait

Talks for an IMF facility could wrap in another month or two, Finance Minister Mohamed Maait told Bloomberg (watch, runtime: 14:28) in a wide-ranging interview that tackled everything from the IMF loan to Egypt’s rising debt levels, devaluation of the EGP, and future bond issuances.

Maait again refrained from providing a range for the size of the IMF loan, saying only that this will be decided in the final stage of negotiations. Maait has previously signaled that the sum will be significantly lower than the USD 15 bn that some analysts have forecast, while some in the market are now expecting a package in the USD 3-5 bn range. Egypt has been in talks with the IMF since March in a bid to secure financial assistance following the economic shocks brought on by Russia’s war in Ukraine, rising interest rates in advanced economies, and a global risk-off hitting emerging markets.


Maait declined to say whether a further depreciation of the EGP is expected. “I cannot say how the markets will move,” he said, when pushed on whether the currency would weaken further should the USD continue to rise. The economy is facing a “difficult” time because of the combination of pressures including inflation, rising interest rates, commodity prices, and portfolio outflows.

Debt levels are rising thanks to the deval: Some 4.0% of our debt-to-GDP ratio — which stood at 87.2% as of June — is due to the change in the USD-EGP exchange rate, Maait said.

Remember- Planning Minister Hala El Said has made it clear that the government is on board with a flexible exchange rate policy. The EGP has been inching down against the greenback in recent weeks as the central bank appears to pursue a gradual devaluation policy. The EGP currently stands at around 19.52 to the USD — down nearly 24% since the initial devaluation in March. Most market watchers are forecasting a double-digit depreciation by the end of the year.


“Affordable” loans from China + Japan? Egypt is in talks with Japan for a USD 500 mn loan, part of which will go towards environmentally friendly projects, Bloomberg quotes Maait as saying. Maait also reportedly said the country is in talks with China on securing loans at a reasonable cost as part of a “package of alternatives.” The government is looking to China and Japan for new avenues to raise foreign currency following a major hit to portfolio inflows amid the global economic turbulence.

Remember- China has emerged as a competitor for the IMF in recent years by shelling out discreet emergency loans to “crisis-hit” countries with no strings attached. Egypt has reportedly been getting a slice of the pie, though it’s not clear how much we’ve received from the country.

The gov’t is scouting out several less-expensive alternatives for FX: Maait also reiterated plans to issue sukuk, CNY-denominated panda bonds worth more than USD 500 mn, and a “green” JPY-denominated bond, following the ministry’s maiden samurai bond issuance in late March. “With the conditions of capital markets, we have to rely on nontraditional, cheaper sources of foreign currencies,” Maait said, adding that debt diversification has helped us manage a “huge outflow” of 22 bn USD in hot money. Maait told us in August that Egypt is in talks with Chinese officials to issue panda bonds and is still on the hunt for bookrunners for the issuance.

Another green bond in the works? The government is also looking at the possibility of issuing a green eurobond “if market conditions allow,” Maait added. The Finance Ministry in January signaled that it is looking to take to the green bond market for a second time with another USD 750 mn issuance, matching the 2020 issuance that saw Egypt debut sovereign green bonds in the MENA region.


The government is still looking to hedge against commodities like wheat but will wait for the markets to cool further, Maait said. “When wheat prices come back under USD 300 per ton, I think we may say that’s a reasonable cost for hedging which can support us to go for such a decision,” he said. International wheat prices have fallen back from record highs in recent weeks as supply problems ease, but remain elevated due to the impact of the war in Ukraine. Hedging could allow the state to purchase commodities at a fixed price during times of market volatility.



Egypt aims to double natgas revenues to USD 1 bn in “coming period,” says Maait

Egypt wants to double natgas receipts: Egypt wants to increase revenues from natural gas exports to USD 1 bn per month from USD 500 mn currently “in the coming period,” Finance Minister Mohamed Maait said at a Bloomberg forum on Thursday. His statements come days after Oil Minister Tarek El Molla said that Egypt eyes generating USD 8.5-10 bn in natural gas revenues in FY 2022-2023, up from USD 6.5 bn last year.

Electricity rationing is partly to thank: The government’s electricity rationing strategy as being a key driver for the higher expected revenues, El Molla said last week, with Egypt able to make additional shipments in August due to lower domestic consumption.


Gov’t finalizes state ownership policy document

The gov’t has dotted the i’s and crossed the t’s on its state ownership policy: The Madbouly government has finalized its state ownership policy ahead of the economic conference that’s being planned for the end of this month, Prime Minister Moustafa Madbouly said Thursday. The document is the product of three months of consultations with the both state and private-sector stakeholders and is expected to lay out a roadmap for large-scale privatization of the economy.

Refresher: The policy document was first launched by Madbouly in May as part of a wider plan to restructure the economy in favor of the private sector. The strategy envisions more than doubling the private sector’s role in the economy to 65% over the next three years, and attracting USD 40 bn in investment by 2026. The new privatization drive came following the economic crisis triggered by the war in Ukraine and during talks with the IMF for a new loan program.

A focus on competitive neutrality: The government’s privatization strategy will look to put in place a legal framework to safeguard market competition and prevent monopolistic practices by state-owned enterprises, Mahmoud Momtaz, head of the Egyptian Competition Authority, said. A competitive neutrality authority chaired by the PM has been set up to review legislation and draft competition rules. “You can't open the market for the private sector without first instituting clear-cut rules necessary for fair and transparent competition on the market,” Momtaz said.

What’s next? The draft document will head to the cabinet to be reviewed for approval, before it is brought to the National Dialogue for debate.


Kashat lands funding from US + pan-African VC

Not all doom and gloom on Planet Startup: Kashat, the region’s first provider of nano-loans, has landed funding from both Plug & Play and Launch Africa as part of its ongoing fundraising drive. Kashat uses machine learning to underwrite credit, providing fast turnaround on productive, short-term loans.

The news comes amid increasing reports of a slowdown in venture funding for startups (see this morning’s What’s Next, below) and as the high-profile failure of Capiter, the non-bank financial services outfit, has sent chills through the community.

What they said: “We are happy to continue to back Kashat in their mission to provide easy lending to everyday Egyptians,” said Launch Africa Managing Partner Zachariah George. “We are proud to back team Kashat as they cross the 100k transaction mark. Egyptians need productive liquidity intervention — and I trust Kashat will be a relief for those in need,” Plug and Play’s Diego Arias García said. Plug and Play bills itself as one of the most active venture capitalists in Silicon Valley.

BACKGROUND- Launch Africa last backed Kashat in a private round a year ago, a couple of months before senior NCR exec Marija Zivanovic-Smith joined Kashat as an independent board member. The company operates in 24 of the nation’s 26 governorates, having expanded this past August to nine more.


Egypt’s plans to become a global yacht tourism destination remain on track

Some 11 new marinas for tourist yachts could be set up on the Red Sea and Mediterranean coasts, under an agreement between the Transport MInistry’s Maritime Transport Sector and several government agencies, Al Mal reported on Thursday, citing an unpublished document said it has seen.

Refresher: In an effort to capitalize on and standardize the country's burgeoning yacht tourism industry, the Madbouly government recently approved regulations to control yacht activity in domestic ports. All aspects of yacht travel to and from Egypt are spelled out in these rules, including the paperwork that must be completed, the services that will be offered by various government agencies, the responsibilities of yacht owners, and the docking fees that will be assessed once they arrive. Sources have told us that yacht tourism could prosper with these rules in place and with the help of our advantageous geographical position.

The proposed new marina locations are set to be spaced around 100 km apart to cover the length of Egypt’s coasts, according to Al Mal. The suggested spots include East Port Said; west of Gamasa; Alexandria’s Montazah area; a tourist resort in Rashid; the Galala Resort in Ain Sokhna; Port Ghalib; and a marina at the port of Berenice.

Yacht tourism can be a solid source of FX inflows, considering that it’s wealthy individuals who own or have access to yachts. The daily spend of those visiting Egypt via yachts is 94% more than the average tourist, former tourism minister Khaled El Anany previously said. Globally, the size of the yacht tourism economy, excluding onshore spending, hovers around the EUR 12 bn mark.


A new berth at West Port Said port could be up and running in October 2022: The General Authority for the Suez Canal Economic Zone expects the first phase of the EGP 1.4 bn Abbas berth to open in West Port Said port in October, Al Mal reported, citing sources it claims have knowledge of the matter.



The Central Bank of Egypt’s decision to leave interest rates unchanged dominated the airwaves over the weekend. We have the full story in this morning’s news well, above.

Who’s celebrating? Unchanged rates is good news for the state budget, seeing as every rate hike comes bearing massive costs — a 100 bps increase in rates could cost the state some EGP 30 bn, banking expert Sahar El Damaty told Yahduth Fi Masr (watch, runtime: 5:12).

Who’s not? Banks. Faced with stricter reserve requirements, commercial lenders could raise their lending rates in efforts to make up some of the lost cash, economist Hany Genena told El Hekaya’s Amr Adib (watch, runtime: 4:00). This means higher borrowing costs for the businesses, public sector bodies and individuals that have taken out loans. Banks could start issuing certificates of deposit (CDs) at competitive rates in efforts to pull EGP liquidity into the banking system, El Damaty told Kelma Akhira’s Lamees El Hadidi (watch, runtime: 7:15). Banks could also start revising downward their forecasted income or increasing their fees for certain services, as they work to find methods to make up for this lost income.

There’s no end in sight to the import crisis, Elsewedy Electric CEO Ahmed El Sewedy told Adib (watch, runtime: 6:14).The CBE’s new rules for facilitating FX for imports have little to no impact on the import restrictions, he said, adding as long as there is no USD in the country, it will remain difficult to import materials and components essential for production. “It’s all about the availability of the USD in the country.” If the situation continues as is, factories will start to shut operations and people will lose their jobs. Mohamed Al Bahi, board member at the Federation of Egyptian Industries, also weighed in on the matter (watch, runtime: 6:15).


Egyptian Gulf Bank (EGBank) will invest EGP 2 bn in non–banking financial companies over the coming three years, CEO and Managing Director Nidel Assar told Bloomberg Asharq. The bank will acquire direct and indirect stakes in a number of companies in the sector, he said, without disclosing which markets the bank is targeting.

The Health Ministry has inaugurated a vaccine storage and distribution complex at state-owned vaccine maker Vacsera’s Sixth of October facility with the capacity to hold between 100-150 mn vaccines, according to a statement. The automated cooling complex was implemented in cooperation with China’s Sinovac and built by China State Construction Engineering.


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Conditions in the financial markets went from bad to worse last week, as higher interest rates pushed everything from stocks to commodities to fresh lows amid weakening economic activity, rising inflation and a strengthening USD. The FTSE All-World index of global stocks lost 5.0% for its worst week since June, Europe’s Stoxx 600 officially entered bear market territory, and MSCI’s gauge of emerging-market stocks hit its lowest level in more than two years. In the US, the S&P 500 ended the week down 4.6%, the tech-dominated Nasdaq Composite shed 4.2%, and the Dow Jones dropped 4.0% to its lowest levels this year. Meanwhile, both US and UK government-bond yields hit their highest level in more than a decade, while data showing declining economic activity in Europe also raised fears of recession. (WSJ | FT | Reuters)

The USD hit an all-time high: The Bloomberg USD Spot Index — which tracks the performance of 10 leading global currencies vs. the USD — surged to a record high on Friday, the business newswire reported.

All is not well in the island kingdom: The GBP tumbled to its lowest level against the greenback since the mid-80s as a surprise round of tax cuts sent markets into a panic.

Oil did not escape the global risk-off sentiment: Brent futures fell 4.2% to close at USD 86.65 a barrel, its lowest close since late January. WTI futures fell below USD 80 per barrel for the first time since January — putting US crude on track for its first quarterly loss in more than two years, according to Bloomberg.

The recession talk is reaching fever pitch: Economists are warning of increased volatility and a “harsh landing” from the Fed’s aggressive tightening cycle. “This is going to be a very, very volatile last quarter,” Amrita Sen, chief oil analyst at Energy Aspects, said in a Bloomberg interview.

EMs will bear the brunt: Emerging and developing markets are now facing a “perfect storm with weak growth, very high interest rates and an extremely challenging external environment when it comes to trade and foreign direct investment,” Ayhan Kose, acting vice-president for equitable growth, finance and institutions at the World Bank, told the Financial Times. “That is why we are worried.”




-0.2% (YTD: -16.9%)



Buy 19.44

Sell 19.52



Buy 19.46

Sell 19.52


Interest rates CBE

11.25% deposit

12.25% lending




-0.4% (YTD: +1.6%)




-0.7% (YTD: +18.1%)




-0.7% (YTD: +6.7%)


S&P 500


-1.7% (YTD: -22.5%)


FTSE 100


-2.0% (YTD: -5.0%)


Euro Stoxx 50


-2.3% (YTD: -22.1%)


Brent crude

USD 86.15



Natural gas (Nymex)

USD 6.83




USD 1,655.60




USD 18,926

-0.5% (YTD: -58.9%)


The EGX30 fell 0.2% at Thursday’s close on turnover of EGP 821.18 mn (14% below the 90-day average). Foreign investors were net sellers. The index is down 16.9% YTD.

In the green: Orascom Construction (+5.8%), Eastern Company (+2.6%) and Talaat Moustafa Holding (+1.9%).

In the red: Madinet Nasr Holding (-4.6%), GB Auto (-4.2%) and e-Finance (-2.2%).


Food security, climate and the Grand Ethiopian Renaissance Dam (GERD) all featured prominently in Foreign Minister Sameh Shoukry’s address to the UN General Assembly last night. Highlights from the 20-minute speech (watch, runtime: 18:20) in New York include:

#1 Food security- The food crisis reflects the international community’s failure to achieve its sustainable development goals, Shoukry said, calling for a strategy that tackles the root causes of food insecurity. “We need to develop sustainable farming and food systems and meet the urgent needs of food importing developing countries,” he said, adding that Egypt is ready to cooperate with the international community to build a global hub to store, supply and trade grains.

#2 Climate change- Shoukry called on advanced economies to provide more aid to developing nations to help them fight climate change.

#3 Debt relief- Shoukry urged creditor nations to get serious on providing debt relief to developing economies, many of which are threatened with debt crises on the back of the pandemic and the spillover effects from the war in Ukraine.

#4 GERD- The minister again spoke of the need for Egypt, Ethiopia and Sudan to find a way out of the GERD crisis, and called on the UN and UN Security Council to put pressure on Ethiopia for unilaterally filling the dam’s reservoir, which he said contravened international law.

Also from the UN General Assembly:

  • “So world, show me the beef” was Shoukry’s message in New York on climate finance, as he called for wealthy countries to step up and allocate both loans and so-called “loss and damage” funds for developing nations, who contribute the least to climate change but are facing the worst of its effects, according to the New York Times.
  • Talks with Lavrov: Shoukry called for a diplomatic resolution to the Ukraine crisis in a meeting with Russian Foreign Minister Sergei Lavrov. Reaching a political settlement with Ukraine is especially importantin light of the negative repercussions on the global economy,” Shoukry told Lavrov, stressing the impact of concurrent food and energy crises on developing countries including Egypt.
  • A renewed push on the Israeli-Palestinian conflict? Shoukry attended a meeting to discuss reviving the two-state solution with counterparts from Jordan, the UK and France, as well as UN and EU representatives. The meetings came as Israel’s new PM Yair Lapid declared support for a two-state solution during his address, becoming the first Israeli leader to do so in recent years.
  • Talks with UK, Irish FMs: Shoukry also discussed upping investment to Egypt with the British and Irish foreign ministers.
  • Shoukry holds talks with US, regional allies: US Secretary of State Anthony Blinken stressed the US’ commitment to regional security and economic prosperity during talks with officials from Egypt, the GCC, Iraq, Jordan and Yemen on Friday, the State Department said.

MEANWHILE- El Sisi meets Al Burhan: President Abdel Fattah El Sisi held talks with Sudan’s military leader, Gen. Abdel Fattah Al Burhan, in Cairo yesterday, Ittihadiya said in a statement. The two discussed trade as well as military and economic cooperation, the statement.


VC funding for startups dipped over the summer from the steady stream that has been typical of Planet Startup in recent years. The four-month period between June and August 2022 saw 12 rounds raise at least a combined USD 68.7 mn, according to our internal tracker — that’s down 30% in value terms from the 11 arounds that raised more than USD 98.4 mn in the same period of 2021.

The dip in value raised came after a torrid winter: March 2022 alone saw Egyptian startups land funding worth at least USD 87.2 mn in 15 transactions.

The community started the year expecting to see Egyptian startups raise USD 1 bn in funding this year — the first time we would cross that barrier. But companies here have raised just USD 346 mn in funding since 1 January, according to our tracker, suggesting they are unlikely to hit that lofty goal.

(Editor’s note: In seeking coverage of their rounds, many startups will say only that they raised a “six figure USD” round — or other, similarly vague approximation. We include the lowest figure possible in the funding total, so the risk to the totals in our internal tracker is to the upside. That upside risk is sharpened by announcements that specify a fundraising figure that includes both equity and debt components without breaking it down into each.)

This is a global slowdown in which Egypt is now being caught up: Risk assets across the board have been hit this year by tightening financial conditions and fears of recession. With borrowing costs on the rise and a downturn in the financial markets, VC-backed companies in the US and other developed markets have begun tightening their belts and are cutting back on staff. Meanwhile, Limited partners in VCs are no longer writing tickets for new funds, while funds are scaling back the size and frequency with which they make new investments.

And Egypt isn’t immune: In recent years Egyptian startups have attracted mns of USD of VC funding from the US and other parts of the world — funding that is now starting to dry up. And funding dries up here quicker than in other parts of the world: Unlike most developed markets, investing in Egypt brings with it a greater degree of currency risk, and with current uncertainty hanging over the EGP, VCs are less likely to invest until there is clarity on where the EGP will settle. Signs of trouble here on Planet Startup have been growing for months, with rising inflation, currency pressure, import restrictions and other supply chain issues giving some international VCs pause for thought before stepping up involvement in Egypt.

Fundraising has been substantially slower than what had hoped, Sequence Ventures Chairman Karim Helal told Enterprise. Sequence Ventures aims to reach its first close of EGP 150 mn before year-end, after which it will start deploying in a number of companies. The VC has already deployed undisclosed amounts in deep tech companies AIM Technologies and Rology.

Valuations have been unrealistic: “We have looked at a number of potential investments but decided not to go through with them, despite liking the model and the business, because they gave ridiculously unrealistic valuations,” Helal says. “People thought VCs were under pressure to deploy. So I think the bar was a bit low … Silly valuations were being accepted on face value and suspect models were being approved.” Companies should not be clinging to unrealistically high valuations — a trend that hurts both companies and investors, Algebra Ventures Managing Partner Tarek Assaad said.

In a time of stress, VCs have been more focused on shoring up existing companies than they have on making fresh investments: This year’s lull was coupled with many investors — mainly international VCs — focusing on their existing portfolio companies rather than deploying funds in new transactions. In 2021 and into 2022, many global VCs were flush with liquidity and things were really looking up in foreign markets. But when that changed, they went back to focusing on their local markets, Assaad said.

Down-rounds are now the norm, Avanz Capital Management Co-Founder and Chief Portfolio Risk Officer Hany Assaad told us. A down round is when a company sells shares at a lower price than its previous funding round. The fall in valuation could occur for a plethora of reasons — failing to hit targets, falling investor confidence and new competitors. We dive deeper into down rounds in our local startup scene here.

The downturn isn’t going anywhere fast (though that’s not the consensus view): Helal anticipates the investment drought will stretch through the end of the year and that we should expect things to go from “slow to slower” as investors become more stringent in terms of what companies they will put money into. Hany is a little more optimistic about what’s to come. “I think there will be more activity in the second half of the year,” he told us. There will still be investments to be made, but expect ticket sizes to fall.

A reality check: What’s going on now “will help companies and investors come back to planet earth in terms of valuations and dissecting the business model,” Helal said. “We are going to see fewer but definitely better and more credible candidates for investments.”

Survival of the fittest: “I think the prospect is very promising but it will be more selective … Giving us much stronger companies with a much higher probability of success,” Helal said.

Some VCs remain unmoved: Algebra Ventures is proceeding with its objective to invest in companies with significant value, creating valuable solutions. “Our approach has always been looking at fundamentals, maybe more so these days than before,” Assaad said.

So, what’s an Egyptian startup to do? If a startup’s continuity depends on the second and third round of funding then that’s cause for worry, because if either of those rounds don't come through they will have no cash flow and will start laying off people, Helal added. “Make sure you grow based on the amount of cash you have on hand. Don't plan based on future funding rounds,” Hany said, adding that downturns have to be planned in the financing.

But the ones that weather the storm will be strongest: Some companies will struggle but the ones who make it will become in a much stronger position, Assaad said.

Your top stories on future trends for the week:

  • Trouble on Planet Startup: Social commerce startup Brimore announced it would restructure and cut costs in a bid to reach profitability.
  • Nclude reaches second close: Some USD 20 mn have been committed by local and foriegn investors to Global Ventures’ Nclude’s second funding round, bringing the fintech-focused VC fund’s total capital to some USD 105 mn.
  • Does crisis-hit Capiter have a buyer? US-based Quona Capital wants to acquire 70-80% of crisis-stricken B2B e-commerce startup Capiter in efforts to reform and restructure the company, sources told Al Mal.
  • CASF to hit third close this quarter: Angel investment group Cairo Angels is set to reach a third and final close of USD 5 mn on its micro-VC fund this quarter, its CEO Aly El Shalakany said.
  • ECC invests USD 5 mn for majority stake in Source Beauty: The Egyptian Company for Cosmetics (ECC) has invested USD 5 mn to acquire a majority stake through capital increase in local online beauty store Source Beauty.
  • Exits raises USD 1 mn in pre-seed finance: Local fintech investment platform Exits has raised USD 1 mn in a pre-seed round from its UK-based investment arm of the same name and others.


OUR CALENDAR APPEARS in two sections:

  • Events with specific dates or months are right here up top
  • Events happening in a quarter or other range of time with no specific date / month appear at the bottom of the calendar.


September: Central Bank of Egypt’s Innovation and Financial Technology Center to launch incubator for 50 fintech startups.

September: Meeting of the Egyptian-German Joint Economic Committee.

September: A delegation from Germany’s Aldi will visit Egypt to look at potential investments.

September: Government to launch an international promotional campaign for Egyptian tourism.

13-27 September (Tuesday-Tuesday): UN General Assembly, New York.

25-27 September (Sunday-Tuesday) A delegation of executives at Egyptian real estate companies visit Saudi Arabia to present developers with potential investments in Egypt’s real estate sector.

25-29 September (Sunday-Thursday) FRANEGYPT will hold its first virtual expo on franchises in the country.

26–27 September (Monday-Tuesday): The Africa Women Innovation and Entrepreneurship Forum (AWIEF) at the Cairo Marriott Hotel.

27-28 September (Tuesday-Wednesday): Egypt-Spain Multilateral Partnership Forum, Sofitel Gezira, Cairo, Egypt.

27-29 September (Tuesday-Thursday): Africa Renewables Investment Summit (ARIS), Cape Town, South Africa.

27-29 September (Tuesday-Thursday): HSBC Energy Transition Webinar series.

28-29 September (Wednesday-Thursday): The sixth edition of Arab Pensions and Social Ins. Conference in Sharm El Sheikh.

30 September (Friday): Winter opening hours for shops and restaurants begin.


October: Air Sphinx, EgyptAir’s low-cost subsidiary to commence operations.

October: Fuel pricing committee meets to decide quarterly fuel prices.

1 October (Saturday): Start of 2022-2023 public school year.

1 October: House of Representatives reconvenes after summer recess.

1 October (Saturday): 2022- 2023 academic year begins for public universities.

4-8 October (Tuesday-Saturday): The Chemical and Fertilizers Export Council of the Trade and Industry Ministry is organizing a trade mission to Kenya.

6 October (Thursday): Armed Forces Day, national holiday.

8 October (Saturday): Prophet Muhammad’s birthday, national holiday.

10 October (Monday): The CEO Women Conference.

10-14 October (Monday-Friday): Gitex Global, Dubai International Convention and Exhibition Centre, Dubai, UAE.

10-16 October (Monday-Sunday): World Bank and IMF annual meetings, Washington, DC.

15 October (Saturday): Cairo Metro will launch a global tender for maintenance work on the power stations and overhead catenary system of Line 1.

16-19 October (Sunday-Wednesday): Cairo Water Week 2022, Nile Ritz Carlton, Cairo.

17 October (Monday): Fifth Egypt and UN-led regional climate roundtable ahead of COP27, Geneva, Switzerland.

18 October (Tuesday): The Egyptian-Swedish business forum, Stockholm, Sweden.

27 October (Thursday): European Central Bank monetary policy meeting.

27-30 October (Thursday-Sunday): Cairo ICT, Egypt International Exhibition Center, New Cairo.

Late October-14 November: 3Q2022 earnings season.

Late October: First Abu Dhabi Bank to complete full integration with Bank Audi’s Egyptian operations after merger.


1-2 November (Tuesday-Wednesday): Federal Reserve interest rate meeting.

1-2 November (Tuesday-Wednesday): Arab League annual summit, Algiers, Algeria.

3 November (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

3-5 November (Thursday-Saturday): Egypt Fashion Week.

4-6 November (Friday-Sunday): Autotech auto exhibition, Cairo International Exhibition and Convention Center.

6-18 November (Sunday-Friday): Egypt will host COP27 in Sharm El Sheikh.

7 November (Monday): The inauguration of the first line of the high-speed rail.

7-13 November (Mon-Sun): The International University Sports Federation (FISU) World University Squash Championships, New Giza.

21 November-18 December (Monday-Sunday): 2022 Fifa World Cup, Qatar.


3 December (Saturday): Dior Men’s pre-fall collection show in Giza.

13-14 December (Tuesday-Wednesday): Federal Reserve interest rate meeting.

13-15 December (Tuesday-Thursday): US-Africa Leaders Summit.

15 December (Thursday): European Central Bank monetary policy meeting.

22 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

December: The Sixth of October dry port will begin operations.

December: Egypt to expand Sudan electricity link capacity to 300 MW.


January: EGX-listed companies and non-bank lenders will submit ESG reports for the first time.

January: Fuel pricing committee meets to decide quarterly fuel prices.

1 January (Sunday): Use of Nafeza becomes compulsory for air freight.

1 January (Sunday): Residential electricity bills are set to rise as per the government’s six-year roadmap (pdf) to restructure electricity prices by 2025.

7 January (Saturday): Coptic Christmas.

24 January-6 February: The 54th Cairo International Book Fair, Egypt International Exhibition Center

25 January (Wednesday): 25 January revolution anniversary / Police Day.

26 January (Thursday): National holiday in observance of 25 January revolution anniversary / Police Day.


11 February (Saturday): Second semester of 2022-2023 academic year begins for public universities.

13-15 February (Monday-Wednesday): The Egypt Petroleum Show (Egyps), Egypt International Exhibition Center, Cairo.

MARCH 2023

March: 4Q2022 earnings season.

23 March (Wednesday) — First day of Ramadan (TBC). Maghreb will be at 6:08pm CLT.

APRIL 2023

17 April (Monday): Sham El Nessim.

22 April (Saturday): Eid El Fitr (TBC).

25 April (Tuesday): Sinai Liberation Day.

27 April (Thursday): National holiday in observance of Sinai Liberation Day (TBC).

Late April – 15 May: 1Q2023 earnings season.

MAY 2023

1 May (Monday): Labor Day.

4 May (Thursday) National holiday in observance of Labor Day (TBC).

22-26 May (Monday-Friday): Egypt will host the African Development Bank (AfDB) annual meetings in Sharm El Sheikh.

JUNE 2023

19-21 June (Monday-Wednesday) Egypt Infrastructure and Water Expo debuts at the Egypt International Exhibition Center.

28 June-2 July (Wednesday-Sunday): Eid El Adha (TBC).

30 June (Friday): June 30 Revolution Day.

JULY 2023

18 July (Tuesday): Islamic New Year.

20 July (Thursday): National holiday in observance of Islamic New Year (TBC).

23 July (Sunday): Revolution Day.

27 July (Thursday): National holiday in observance of Revolution Day.

Late July-14 August: 2Q2023 earnings season.


26 September (Tuesday): Prophet Muhammad’s birthday (TBC).

28 September (Thursday): National holiday in observance of Prophet Muhammad’s birthday (TBC).


6 October (Friday): Armed Forces Day.

Late October-14 November: 3Q2023 earnings season.


2H 2022: The inauguration of the Grand Egyptian Museum.

2H 2022: IEF-IGU Ministerial Gas Forum, Egypt. Date + location TBA.

2H 2022: The government will have vaccinated 70% of the population.

3Q 2022: Ayady’s consumer financing arm, The Egyptian Company for Consumer Finance Services, to release its first financing product.

3Q 2022: Swvl to close acquisition of Urbvan Mobility.

4Q 2022: Infinity + Africa Finance Corporation to close acquisition of Lekela Power.

4Q 2022: Electricity Ministry to tender six solar projects in Aswan Governorate.

4Q2022: Raya Holding subsidiary Aman and Qalaa Holdings’ Taqa Arabia to launch their fintech company.

End of 2022: Decent Life first phase scheduled for completion.

End of 2022: e-Aswaaq’s tourism platform will complete the roll out of its ticketing and online booking portal across Egypt.

2023: Egypt will host the Asian Infrastructure Investment Bank’s Annual Meeting of the Board of Governors in 2023.

1Q 2023: Adnoc Distribution’s acquisition of 50% of TotalEnergies Egypt to close.

**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 above 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.

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