Wednesday, 14 December 2022

AM — Big Red gets new owner as Vodacom snaps up 55% of Vodafone Egypt



Good morning, friends, and welcome to another busy news day. There’s no rest for the wicked as we look at a flood of M&A and FX news, Fed day in the US of A, and speculation that the Central Bank of Egypt could go for a snap interest rate hike ahead of the IMF’s planned Friday board meeting to review our request for a USD 3 bn facility.


The US-Africa Leaders’ Summit continues in Washington today: President Abdel Fattah El Sisi is among the 49 African heads of state in Washington this week for the US-Africa Leaders’ Summit. Ittihadiya confirmed this morning that the president had landed in the US capital, and said that he would be meeting with a number of senior US officials, CEOs and African leaders, though it didn’t name names.

Transport Minister Kamel El Wazir is in the UK to attend meetings of the International Maritime Organization (IMO), the ministry said yesterday.


Will we finally close an IMF facility this week? The IMF’s executive board will discuss Egypt’s request for a new extended fund facility on Friday, 16 December. Egypt and the Fund reached a staff-level agreement for a USD 3 bn, 46-month loan program at the end of October, but the arrangement needs the sign off from the board before the loan can start to be disbursed.

An unscheduled CBE meeting this week? Al Ahly Pharos elaborated on their prediction for this year’s final policy meeting in a note on Monday, writing that the Monetary Policy Committee could devalue the EGP by another 15% to rein in the parallel market and hike interest rates by 200 bps in an unscheduled meeting. BNP Paribas are of the same opinion, predicting the EGP to fall to 33 against the greenback by the end of the year and 37 during the next quarter. The derivatives markets are also pegging the currency significantly below the current market rate, with 12-month non-deliverable forwards changing hands at EGP 30 last week.

MEANWHILE- The IMF agreed yesterday to offer Ghana a USD 3 bn lifeline after reaching a staff-level, the lender said in a statement yesterday. Ghana joins Egypt, Bangladesh, Lebanon, Pakistan, Sri Lanka, and Zambia in requesting IMF facilities this year.

PSA- Two days until the e-invoicing deadline: Companies have until Thursday to register with the Tax Authority’s e-invoicing system. Only 150k companies had signed up to the new system ahead of the previous deadline of 15 December, according to the Tax Authority’s most recent tally at the end of November, which is well below a sought goal of 1 mn companies to register under the system.

REMEMBER- This deadline no longer applies to the self-employed: The Finance Ministry pushed the deadline for self-employed professionals — including doctors, pharmacists and lawyers — to 30 April 2023 after widespread opposition to the system.


It’s Fed day: We’ll find out this evening by how much the Federal Reserve will raise interest rates when its final policy meeting wraps. The consensus is that policymakers will begin to ease the pace of the tightening cycle with a 50-bps hike but signal that it will continue to raise rates into 2023. Faced with soaring inflation, the central bank has embarked on its most aggressive series of rate hikes in years, raising rates by 375 bps since March including four consecutive 75-bps hikes.

The market got what it wanted ahead of the big day: Unexpectedly cool inflation data out yesterday gave the Fed more room to start a dovish pivot, further raising market expectations for a smaller hike today. The consumer price index fell to 7.1% in November, below the 7.3% expected by analysts, and down from 7.7% the month before. This is the lowest reading since December 2021, and will give further confidence to those who believe that we’ve passed peak inflation.

Conditions will stay tight in 2023: Inflation may be past its peak but it remains well above target in the US, the EU and the UK, meaning central banks will continue to raise rates into 2023 albeit at a slower pace, the Financial Times writes. “Inflation is decelerating and the pace of rate rises is smaller, but central banks are still going to be hiking by larger amounts than historically,” Silvia Ardagna, chief European economist at Barclays, said.

WORLD CUP- Morocco will play arguably the biggest game in their history tonight when they face off against France in the semi-final of the World Cup. The Atlas Lions have the rest of the Middle East and Africa behind them when they take to the field at 9pm tonight, making history as the first-ever African team to make it to the last four of the competition.

It’s going to be tough: France are the strongest team left in the competition and will be favorites to get their hands on the trophy for the second consecutive tournament. A lethal strike force of Kylian Mbappe, Antoine Griezmann and Olivier Giroud will test Morocco’s battle-hardened defense to the max and their never-say-die attitude means that Morocco can expect a strong response if they find themselves in the lead.

But anything is possible: Morocco has already beaten three teams ranked among the top 10 in the world. They shocked the world by knocking out Spain in the last-16 and Portugal in the quarter-finals, and beating Belgium 2-0 to top their group. Morocco also has the best defensive record in the competition, only conceding once (an own goal vs. Canada) in the five games they’ve played. France aren’t exactly impregnable, either, having conceded in all but one of their games (and losing to Tunisia 1-0).

Whoever wins will meet Messi in the final after Argentina swept Croatia aside in last night’s game. Argentina became the first to reach the final, winning 3-0 against the 2018 runner-ups with two goals from Julian Alvarez and a penalty from Lionel Messi. Messi became Argentina’s all-time top scorer in the tournament, surpassing Gabriel Batistuta’s record with an 11th career World Cup goal.



Sam Bankman-Fried is Sam Bankman-[redacted]: The co-founder and CEO of the collapsed crypto exchange FTX has been accused of committing “one of the biggest financial frauds in American history” by the US Department of Justice, a day after he was arrested by Bahamian police ahead of a possible extradition to the US. SBF has been charged with eight counts including money laundering, conspiracy to commit wire fraud, securities fraud, and campaign financing violations, and if found guilty, faces years behind bars. (Reuters | AP | Bloomberg | FT | WSJ | CNBC)


*** It’s Hardhat day — your weekly briefing of all things infrastructure in Egypt: Enterprise’s industry vertical focuses each Wednesday on infrastructure, covering everything from energy, water, transportation, and urban development, as well as social infrastructure such as health and education.

In today’s issue: Proposed amendments to a law on building violation reconciliations, which could eventually see the government reach reconciliation agreements on some wildcat buildings, could present a big opening for local real estate developers.


Somabay brings out the best in majestic natural elements where raw beauty and endless activities reign supreme. Immerse yourself into a picturesque getaway all year long. This is simply Somabay. For more information, call 16390 or visit


Vodacom is officially Vodafone Egypt’s majority shareholder

South Africa’s Vodacom now owns the lion’s share of Vodafone Egypt: Vodafone Group has transferred its 55% stake in its Egyptian unit to its South African subsidiary Vodacom in a EUR 2.37 bn cash and stock transaction, it said in a statement yesterday. The British company received 242 mn shares in Vodacom and EUR 577 mn in cash in return for the majority stake in Vodafone Egypt.

Vodafone Egypt is now jointly owned by Vodacom and Telecom Egypt, which holds the remaining 45% of Vodafone Egypt. (Separately, the transaction raises Vodafone Group’s stake in its South African unit to 65.1% from 60.5%, it said.)

Could Vodafone Egypt soon be welcoming more new shareholders? The Qatar Investment Authority is reportedly among three Arab sovereign funds in talks with Telecom Egypt to purchase a 20% stake in Vodafone Egypt, which local reports have suggested could close before the end of the year.

We thought this was coming: The statement comes a few days after reports in local media suggested that Vodacom acquired the parent company’s 132 mn shares in Vodafone Egypt in a block trade transaction on the EGX for USD 2.4 bn.

A win-win for all: The sale will help Vodafone streamline its African assets and hand Vodacom exposure to a “leading business in an attractive market, diversifying its portfolio and accelerating its growth profile,” the company said. “Vodafone Egypt will benefit from closer cooperation with its new majority shareholder, allowing it to fasten the pace for growth in financial services and the Internet of Things.”

What they said: "With the completion of the transfer of Vodafone Group Plc's shareholding in Vodafone Egypt to Vodacom Group Limited, we are simplifying Vodafone Group's structure and supporting Vodacom and Vodafone Egypt for future growth,” said Margherita Della Valle, who is taking over from Nick Read as the group CEO this month.

REFRESHER- Vodacom shareholders approved plans to purchase the shares in January after the two companies announced an agreement in November 2021. The transaction values the 55% stake in Vodafone Egypt at EUR 2.72 bn on a debt-free, cash-free basis, giving the company an overall valuation of EUR 4.95 bn, by our math. Vodafone had been expecting to close before the end of March, but the transaction stretched on as the two sides waited for approvals from Egyptian regulators.


French cement producer Vicat Egypt has raised its stake in EGX-listed subsidiary Sinai Cement to 67.2% from 51.0%, according to a disclosure (pdf) filed on the EGX last week. The company bought a 16.2% stake (c. 21.5 mn shares) for EGP 139.6 mn (USD 5.66 mn), the filing said.

Among the selling shareholders: Arab Industrial Investment sold (pdf) a 6.6% stake, United Company for Development and Services offloaded (pdf) 4.85% and the Investments Company for Industry sold (pdf) 3.1%.

Vicat tried to mount a takeover bid for Sinai Cement earlier this year, launching a mandatory tender offer for 42.1% of the company’s shares.


UAE-based tech investor Astra Tech is looking to invest USD 400 mn in four Egyptian financial services and consumer finance companies next year, founder Abdallah Abu Sheikh reportedly told Al Mal. The planned acquisitions are part of the company’s plans to create a super app that includes payment and transfer services.

Astra Tech is no stranger to Egypt: The company has been present in the Egyptian market since 2018, Abu Sheikh is quoted as saying, adding that the company has so far invested USD 400 mn. Earlier this year Astra Tech acquired Emirati super app Rizek, which launched operations in Egypt last year.


Appetito + Jumlaty merge to become Nomu

Appetito + Jumlaty tie up: Cairo-based grocery delivery startup Appetito and Saudi Arabia’s Jumlaty have merged to form a new company called Nomu in that they say is a bid to become the region’s leading food-tech supply chain platform, according to a joint statement out yesterday. Neither party released details about the merger, what triggered it, their post-transaction shareholding structure, or the company’s strategy going forward.

CEOs take the top jobs: Appetito CEO Shehab Mokhtar is now Nomu’s CEO while Salman Attieh, CEO of Jumlaty, is the chairman. The company will have its headquarters in Riyadh with a holding structure in Abu Dhabi’s International Financial Center.

Nomu has access to four markets: The company combines Appetito’s presence in Egypt, Tunisia and Morocco and Jumlaty’s operations in Saudi Arabia to give it access to four markets in the MENA region and 100k F&B stores, according to the statement.

Aiming big: The merger sees Nomu on track to deliver USD 25 mn in revenue and a positive EBTIDA in 2023, Mokhtar said.

What they said: “Both companies shared the same vision on how to transform the industry, combining smart tech, lean operations with a deep focus on unit economics. Together we capture the entire value chain, from monthly shopping to weekly refills and outdoor dining,” Attieh said.

Further expansion plans: Nomu aims to expand to Pakistan and key sub-Saharan countries in the near future.


Agriculture is Egypt’s gold mine, says Cayesh’s Mahmoud Hassan

We recently had breakfast with 20 top CEOs to talk about why exports and FDI are key to our economy going forward. After reading our five-step recipe for turning Egypt into a global export hub and FDI magnet, every participating CEO has agreed to answer two questions on the record.

We’ve already heard from: GSK’s Mohamed El Dababy | McKinsey’s Jalil Bensouda | Somabay’s Ibrahim El Missiri | ALC Alieldean Weshahi & Partners’ Bahaa Alieldean | HSBC Egypt’s Todd Wilcox | Actis’ Sherif El Kholy | Amazon’s Omar El Sahy | BII’s Sherine Shohdy | Mansour Automotive’s Ankush Arora | Apex’s Tom Maher | Travco’s Moataz Sedky.

Speaking to us today: Mahmoud Hassan (LinkedIn) is the co-founder of supply chain finance startup Cayesh. Hassan is also a non-executive cofounder of fintech platform D-Fin. Over the past two decades, he has spent a large portion of his career working closely with SMEs and small and medium funds, including at the International Finance Corporation and Sharaka Fund, in addition to more than a decade in consulting, including Arthur Andersen and Ernst & Young.

ENTERPRISE- Which industry would you put on a focused short list — and why?

MAHMOUD HASSAN- The agriculture sector is a gold mine that we are sitting on. We need to start with primary industries where we have a competitive edge. The agri sector is a primary feeder to many industries — from food processing and manufacturing to textiles. Historically, we have the know-how and the expertise, but more advancement is needed in terms of knowledge and technology. It just needs someone to scratch the surface and get it back to where it was. Once, agriculture accounted for 16% of GDP. Now, it’s only 11.3%.

We are more advanced than neighboring agri markets like Libya, Saudi Arabia, or Sudan, so we can leverage this by becoming an export hub for these markets. We can also still produce and export our products to Southern and Eastern Europe at relatively competitive prices compared to other markets like Morocco or parts of East Asia. From a domestic perspective, agriculture is key for food security as the population increases. You'll find that low- and middle-income families spend 50-60% of their monthly budget on food.

We have the best cotton in the world: It’s a shame that it gets exported as a raw material, treated, and then re-sold to us at a much higher value. Why don't we have that knowledge and expertise to do the treatment in-house, and then export cotton as a value-added product? Another example is food oil — a tremendously fast-growing industry worldwide and very much needed.

We have the enablers: relatively cheap labor, suitable weather, and the natural geographic location. State-owned entities including the Agricultural Bank of Egypt and e-Finance have huge databases on the agricultural land bank, so we know which plots in every single corner in the country produce what crops and how we can benefit. As your five-step recipe suggests, we just need to focus on it.

I think Egypt can focus on five to eight industries in the next few years. Five is on the low end for a country with a population as large as ours; India, by comparison, started with 15 industries. The payoff will be tremendous in terms of where we'll stand and how we can position ourselves in the region.

E- Why are exports and FDI the way forward?

MH- I've worked at the IFC and the World Bank for almost eight years, so I’ve seen firsthand the economic developments in nascent and developing markets in Africa and East and South Asia. Look at how the Vietnamese economy evolved after the economic reforms that started in the 1990s. GDP multiplied by five. By 2017, the trade surplus reached almost USD 3 bn. FDI boomed from a few bn USD to double digits. It's similar in India, where FDI increased by almost 51% between 2010 and 2011. That's incredible. This is where we need to be, and why we need to enhance our economic drivers to be export-led.

It has to be private sector-led and government-backed. The Indian model, with its Invest India program, really resembles what we're doing with the Sovereign Fund of Egypt. But in India it’s private sector-led, whereas here it’s government-led. So we need to balance the role each party plays in that game.


In its search for FX, Egypt is burning more mazut

Egypt’s use of mazut fuel oil in power stations has soared to a five-year high as the country works to increase natural gas exports, according to data seen by Reuters. Figures from the Egyptian Electric Utility and Consumer Protection Regulatory Agency (Egyptera) showed that mazut accounted for almost 21% of all fuel used by power stations in October, the highest since September 2017 when it registered 22.8%.

That’s not all: Data from the Joint Organisations Data Initiative shows that demand for mazut rose to 135k barrels per day in September, the highest since June 2018.

Why are we burning more mazut? To help ease a shortage of foreign currency. Egypt had significantly reduced its use of mazut in recent years but has increased consumption following a decision in August to begin rationing the amount of natural gas used in local power plants. The government wants to make more natural gas available for export, which will bring more hard currency into the country as officials wrestle with the country’s external position.

Cheap… Burning mazut is four times less expensive than burning natural gas priced at the European TTF benchmark, Eugene Lindell, head of refined products at energy consultancy FGE, told the newswire. Refinitiv data shows that Egypt has significantly upped its purchase of discounted Russian fuel oil, enabling it to make “massive” savings, he said.

…but environmentally-costly: Mazut is a low-quality, high-sulfur fuel oil that generates more air pollution when burned than other types of oil.


Premium Card issues EGP 201 mn in securitized bonds

Premium Card closes seventh securitized bond issuance: Consumer finance firm Premium International for Credit Services (Premium Card) has issued EGP 200.6 mn worth of securitized bonds, our friends at EFG Hermes, which advised on the transaction, said in a statement (pdf) yesterday. The bond was issued in a 10-month tranche with a Prime-1 rating and a three-year tranche with an A rating from Middle East Rating Services (MERIS).

Premium is now more than halfway through its EGP 2 bn securitization program: The company has issued two-thirds (c. EGP 1.3 bn) of the program it began in October 2019.

Advisors: EFG Hermes was the sole financial advisor, sole transaction manager, and bookrunner, underwriter, and arranger on the issuance. CIB and the National Bank of Egypt acted as underwriters.

2022: The year of securitization. The total value of securitized bond issuances brought to market this year now stands at some EGP 45.4 bn, almost triple the EGP 15.8 bn taken to market last year.


New building violation reconciliation law gets a nod by a House committee

New building reconciliation law gets committee approval: The House Housing Committee yesterday approved the new bill that will make it easier for owners of illegal buildings to go legit following three days of discussions. The legislation ⁠— which replaces a 2019 law designed to legalize informal buildings ⁠— will prevent structures built next to the Nile from being legalized. The committee also agreed that illegal buildings on archaeological land and public car lots will remain outside of the scope of the law.

There’s still no word on what happens to reconciliation requests that fall outside of the scope of the law. The new legislation will prevent some 920k buildings from being legalized, potentially resulting in their demolition.

REFRESHER- The original legislation gave owners the option to pay to reconcile illegal buildings but authorities have only responded to a fraction of the requests and fines have gone unpaid. Lawmakers are now drafting a new bill to replace the 2019 legislation, though the original reconciliation requests will remain valid.

What’s next: The new bill will now head to the general assembly and could be up for discussion and vote when the House reconvenes on Sunday, 18 December.


Amendments to the Unified Tax Procedures Act get greenlight: The House Budget Committee approved a controversial one-article amendment to the Unified Tax Procedures Act that would allow foreign tax authorities to access individuals and businesses’ financial information. Policymakers have moved to assure the public that the law will not give the Egyptian Tax Authority access to personal information and is being passed to meet obligations required by the Global Forum for Transparency and Exchange of Information for Tax Purposes, which Egypt joined in 2016.

Just for foreigners: The scope of the amendments is limited to foreigners whose financial and tax agreements could be a matter of information exchange among countries, Deputy Finance Minister Ramy Youssef said. He argued that a membership in the forum requires that countries exchange data on tax evasion, tax havens and others. “Countries that fail to comply with the forum’s obligations could face disciplinary measures, not to mention that international lending institutions could use this disciplinary action to strip failed countries of obtaining financial assistance in the form of grants and loans,” he said.

What’s next: The amendments will be up for discussion and a vote when the House reconvenes on Sunday 18 December.


Senators reject Digital Egypt fees: A final Senate vote on the Digital Egypt bill was delayed yesterday after a majority of senators rejected an article that would allow the Communications Ministry’s Digital Egypt initiative to charge EGP 100 fees for its services.

What they said: "We can’t approve any articles imposing fees on citizens at the present time and amid such hard economic conditions,” Senator Hossam El Kholy, head of the parliamentary group of the pro-government party Mostaqbal Watan said. The government stresses the fees are mandatory, with Deputy Communications Minister Khaled El Attar saying that the fees are necessary to have the initiative providing online services on a sustainable basis.

What’s next: Senators will debate the bill when they reconvene for the next session on Sunday 25 December.


The Senate Housing Committee approved amendments to the 2008 Building Law that would ban construction outside approved urban areas, according to Al Mal.


Ahmed Galal (Linkedin) was appointed chairman of state-owned Export Development Bank (EBank) for a three-year term, while Mohamed Abul Soud (Linkedin) has been made deputy chairman, according to a disclosure to the EGX (pdf). Galal has served as the bank’s deputy chairman since August 2017 while Abul Soud headed up the bank’s consolidated risk management group since September 2017.



It was a slow night on talk shows yesterday, with the US-Africa summit in Washington leading the coverage by talking heads.

The shows zeroed in on the US-Africa Leaders’ Summit in Washington, Dc, where 49 African leaders have gathered, among them President Abdel Fattah El Sis. The first US-Africa summit was last hosted in 2014 by then-president Barack Obama, Kelma Akhira’s Lamis El Hadidi notes (watch, runtime: 14:45). “The question here is what Washington will offer to Africa,” El Hadidi said as she took note of American media reports of growing Chinese and Russian influence in Africa and sizable trade volumes with the continent.

The US has already some pledges for the continent ahead of the summit, Heba El Koudsy, who serves as Washington bureau chief for pan-Arab newspaper Asharq Al Awsat, told El Hadidi, referring to statements by White House national security adviser Jake Sullivan on the US committing USD 55 bn to Africa over the next three years. Washington will fund initiatives sectors, including health, epidemic control, infrastructure, food security and renewables, El Koudsy said. “Washington has awakened to a new reality after 2014’s summit where China has increased its influence in the continent through a wide trade exchange and facilitated loans to African nations,” she said.

GERD not on the agenda? Asked whether GERD would be on the summit’s agenda, El Koudsy said it would be unlikely, given that Ethiopian PM Abiy Ahmed is not among the attendees. The attendance by the Ethiopian leadership is limited to a participation by Ethiopian President Sahle-Work Zewde, El Koudsy said, describing Zewde’s position as a “ceremonial role.” Sudan was also not invited to attend the summit, she said, adding that the Biden administration does not attach high priority to the dam crisis.

The summit is also getting a mention from Masaa DMC (watch, runtime: 3:57).

It’s crunch time for Morocco in Doha: Morocco’s World Cup semi-final showdown against France today was on the minds of several of the talking heads. Kelma Akhira’s El Hadidi described it as a “decisive game for all of us” while speaking with ON Time sports correspondent on latest preparations for the game and statements between both teams’ head coaches. Masaa DMC phoned Morocco’s former head coach Rachid Taoussi who described Morocco’s current manager Walid Regragui as the “champion of the tournament,” and said that weak points in the French defense could give Morocco an opportunity to advance (watch, runtime: 7:49).

Al Hayah Al Youm took note of four new companies submitting requests online to obtain the government’s golden license for industry (watch, runtime: 0:54). The unnamed companies’ activities are focused on food industries, agricultural products, furniture, wood and integrated waste management.

REMEMBER- The government announced last week it will allow companies to apply for golden license online through the Cabinet’s website. The website now includes an application form and a guide for how to obtain the single-approval licenses. Companies need to fill out the form, which asks for details including annual exports and local component usage, as well as upload the relevant documents.

The Education Ministry on Thanaweya Amma examinations kicking off on Saturday 10 June got a mention from Al Hayah Al Youm (watch, runtime: 6:59) and Masaa DMC (watch, runtime: 3:25).


It’s a slow morning in the pages of the foreign press:

  • Flamboyance of flamingos flock to Port Fouad: Xinhua has a photo essay on the flamingos catching some winter sun in the Port Said nature reserve.
  • Buried treasure: An Egyptian-British archaeological mission discovered gold jewelry buried in the ancient city of Amarna in Minya. (The National)
  • Egypt returned 176 antique coins to Saudi Arabia, Jordan, Iraq, and China. Authorities seized the coins at Cairo Airport and post offices during attempts to smuggle them out of the country. (The National)



One step closer to the Egyptian-Greek subsea data cable: Telecom Egypt and Greek telecoms company Grid Telecom signed an agreement to lay a subsea data cable across the Mediterranean, according to a joint statement (pdf). The cable is part of a system that will connect Europe, Asia, and Africa and will “reinforce Egypt’s strategic position as an international telecommunications hub linking the East and West.” The two sides signed an initial agreement for the project over the summer.

Siemens has been awarded an EUR 40 mn contract to set up a smart grid system and supply 175k smart meters in Dakahlia, Damietta, and Kafr El Sheikh governorates, it said in a statement last week. The project is being funded by the Japanese International Cooperation Agency. Siemens was awarded (pdf) a similar contract in September that will see it equip two control centers and supply 300k smart meters in Alexandria Governorate.


Powered by
EFG Hermes -

Adnoc is moving ahead with its big IPO plans for gas unit: The Abu Dhabi National Oil Company (Adnoc) has tapped several banks to lead a planned IPO for its gas unit next year, Bloomberg reported, citing people in the know. The state energy company has reportedly chosen Goldman Sachs, Bank of America and First Abu Dhabi Bank as joint global coordinators for the share sale, which is slated to be one of Abu Dhabi’s largest listings, the sources said. The news comes a few weeks after Adnoc said it will combine its LNG and gas-processing arms into a single entity, Adnoc Gas, that it plans to take public on the ADX next year.

Global debt is falling, but it’s a mere drop in the ocean: Global public and private debt posted its largest drop in 70 years in 2021 but still remained well above pre-pandemic levels, the IMF said on Monday. Total public and private debt dropped 10 percentage points to 247% from its peak level of 257% a year earlier, it wrote in a blog post accompanying its first Global Debt Monitor.

Also worth noting:

  • Microsoft will acquire a 4% stake in the London Stock Exchange Group from a consortium of Blackstone and Thomson Reuters under a 10-year strategic partnership. (Statement)
  • Qatar Investment Authority to invest in Siemens? Siemens Energy is on the hunt for new investors and a possible entry of a sovereign wealth fund, with Qatar among the candidates. (Handelsblatt)
  • Europe’s energy crunch could be more difficult to handle next year: “The crisis is not over. Next year, 2023, may well be much more difficult than this year,” International Energy Agency head Fatih Birol said yesterday. (Reuters)
  • Japan’s Nomura is expanding its wealth management services to Dubai, in another sign of the city’s growing clout as a regional financial hub. (Bloomberg)




+2.9% (YTD: +26.8%)



Buy 24.62

Sell 24.70



Buy 24.61

Sell 24.68


Interest rates CBE

13.25% deposit

14.25% lending




+1.9% (YTD: -9.4%)




-1.0% (YTD: +18.4%)




-0.5% (YTD: +3.3%)


S&P 500


+0.7% (YTD: -15.7%)


FTSE 100


+0.8% (YTD: +1.6%)


Euro Stoxx 50


+1.7% (YTD: -7.3%)


Brent crude

USD 80.54



Natural gas (Nymex)

USD 6.97




USD 1,822.10




USD 17,768

+3.4% (YTD: -61.6%)


The EGX30 rose 2.9% at yesterday’s close on turnover of EGP 3.6 bn (152.4% above the 90-day average). Local investors were net buyers. The index is up 26.8% YTD.

In the green: Oriental Weavers (+17.0%), Qalaa Holdings (+15.8%) and Madinet Nasr Housing (+10.5%).

In the red: Telecom Egypt (-1.4%), CIB (-0.6%).

It’s a sea of green in Asia this morning as investors predict yesterday’s positive US inflation data to allow the Federal Reserve to ease off its hawkish interest rate policy. The picture is more mixed in Europe, with shares in London and Germany expected to fall. Wall Street will open higher.


President Abdel El Sisi issued a decree demarcating Egypt’s western maritime border in the Mediterranean. “Egypt’s territorial borders begin from the Egyptian-Libyan border point No 1 to 12 nautical miles to point No 8. The western maritime border line runs from point No 8 to the north,” according to the decree published in the Official Gazette read.

Maritime boundaries in the EastMed are being contested: Turkey and Libya’s Tripoli-based government controversially announced a new joint exclusive economic zone in the Mediterranean in 2020, a move that was condemned by Egypt and Greece, who set up their own joint economic zone that ignored Ankara’s claims. Turkey and Libya signed an agreement in October that could pave the way for the two countries to explore for oil and gas in the area.


Could the new building violation reconciliation law be a shot in the arm for real estate developers? Members of Parliament are currently discussing a new building violation reconciliation law which aims to permit owners of some illegal buildings to pay reconciliation fees and legalize their statuses. Some elements of the Senate-approved draft law — like exclusions for some 920k buildings and reduced fees — have drawn significant attention in the past week. It’s not yet clear what the final bill will look like but if reconciliation agreements are expedited and more widely accepted, the wider real estate market could soon be seeing some positive outcomes, our sources tell us.

Clamping down on building violations: The bill, which was approved by the House Housing Committee yesterday, would make the government’s primary directive in this space to eliminate wildcat building construction, extract more tax revenue and fees from old violations, and prevent new encroachments on architectural and archaeologically significant sites.

Reconciliation efforts are not new: The government has since 2019 introduced legislation that provides violators the chance to pay a fine and allow them to legalize the buildings’ status instead of evicting residents and demolishing the buildings. Since then, obstacles to fully realizing the government’s goals — like a flood of requests and a lack of unified rules — have proved challenging to overcome, which is why new amendments are currently under discussion in the House of Representatives.

The problem is that the scope of wildcat construction is overwhelmingly large: The government has since 2020 received 2.8 mn reconciliation requests — 1.2 mn of which were located in governorates outside of Cairo. Of those submitted since then, only 3% were accepted, generating about EGP 22 bn in fines — only 25% of what the government had anticipated it would collect.

Fines and fees will be reduced: Under the new draft amendments, reconciliation fees will be reduced. Inspection fees for potential violations are set at a maximum EGP 5k while 25% of a “seriousness fee” (the exact value of which will be outlined in the executive regulations) will be required. The executive regulations of the law will specify the exact breakdown of the new fees that will be broken down into different brackets. The new bill will try to make it easier for people to pay, according to Local Development Minister Hisham Amna, who said that it would allow people to pay the fees in installments over five years, with a 25% reduction if made in a single payment. House Local Administration Committee head Rep. Ahmed El Seginy described the law as more flexible than previous efforts to revive the real estate market and disincentivize future wildcat construction.

These amendments are expected to generate some EGP 20 bn in fines, which could increase to some EGP 100 bn if the government offers up more concessions, Rep. Ehab Mansour told us.

But disputes in parliament remain an obstacle: Amendments to the law are still seeing fierce debate in the House of Representatives. The draft law would, if passed, require both government intervention and flexibility to bring the housing crisis to a resolution, Mansour said. If executed appropriately it could help revive the real estate market, pave the way for bringing the real estate developers law on the agenda and ultimately improve regulation of the real estate market in Egypt, Mansour added.

Demolitions could be halted: The draft law of the proposed amendments stipulates demolitions of wildcat constructions would be repealed in favor of a more flexible approach to handling violations. Part of the rationale for this amendment is that certain building violations are located in areas where demolitions would be nearly impossible to execute. It's not yet clear if a moratorium on demolitions would apply to buildings situated on the Nile, archaeological land or public parking lots.

Collecting fines from construction violations could be a more useful approach instead: Instead of demolitions, extracting fines from wildcat building owners could be used to help finance low-income housing projects. But this is still expected to exclude encroachments on the Nile and archaeological sites.

Allowing more urban development: Governorates need to be granting more building permits in urban areas so that wildcat construction doesn’t crop up later, Mansor said.

Could reconciliation cause a boon in the larger real estate market? Putting an end to old violations will encourage contractors to return to construction, which should boost the real estate market and building materials, Mohamed Saad Sami, head of the Egyptian Federation for Construction & Building Contractors told us.

Stability in the construction industry is crucial: Although stability is essential for real estate development, setting five story limits on new buildings is a major problem, Mansour and Sami told us. Building permits are available, but regulations placing limits on things like building height have seen contractors bring their construction work to a halt, Mansour explained.

There are also lingering questions about non-residential licensing that the new amendments in parliament could soon resolve, Mansour says. Licensing for pharma manufacturers, schools, and parking spaces are among the types of buildings that could see some more clarity once the new amendments are settled.

But some government intervention will be needed first: An urgent memorandum to Prime Minister Moustafa Madbouly has requested that the deadline for handing over government projects be extended to four months so as not to crowd out companies and contractors in the market in light of price hikes and cost pressures, Sami told us.

Real estate developers are on the edge of their seats: Real estate developers are anxiously waiting for new amendments to be signed into law, Mohamed El Bustani, chairman of the board of directors of El Bustani Group and head of the Real Estate Developers Association in New Cairo and the new administrative capital told us. Reconciling with violators will help reassure construction companies and signal for more construction to commence, El Bustani explained. Reducing reconciliation fees will help drive up people’s demand for new real estate, he said.

But what’s important is what those fees end up financing: Using the finances generated from these fines to build more public housing projects could give real estate companies a big boost, Sami says. It would also provide much-needed financing to contractors who face challenges with liquidating letters of guarantee and are short on liquid currency at the moment, Sami explained.

Your top infrastructure stories for the week:

  • EGP 1 bn phase of waste management program kicks off: The planning, environment, and local development ministers signed an EGP 1 bn contract to implement the fourth phase of the nationwide waste management project.
  • Gulf sovereign funds are bidding for Egypt desalination plants: The sovereign funds are amongst 28 bidders vying for contracts to build the 21 desalination plants the government is tendering to the private sector.
  • Global tyre manufacturer Prometeon Tyre will invest EUR 30 mn to upgrade its factory in Alexandria.
  • The gov’t scraps the minimum issued capital requirement for companies applying for the golden license: Infrastructure and industrial companies no longer have to meet the minimum issued capital requirement to apply for golden licenses.
  • Cabinet approves move to join BRICS development bank: Ministers approved plans for Egypt to join the USD 100 bn multilateral lender New Development Bank set up by the BRICS economic group to fund infrastructure and development projects in member countries.



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


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.

16 December (Friday): IMF executive board to discuss Egypt’s EFF request.

19-20 December (Monday-Tuesday): The Arab Administrative Development Organization’s conference on Modern Methods in Hospital Management, Cairo.

20 December (Tuesday): EGX-listed Pachin will brief shareholders on offers received to acquire the company in an ordinary general assembly.

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

25 December (Sunday): Senate back in session.

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.

January: Infinity + Africa Finance Corporation to close acquisition of Lekela Power.

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: Cairo International Book Fair, Egypt International Exhibition Center

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

26 January (Thursday): President El Sisi will visit India as “chief guest” at celebrations to mark the 74th anniversary of Indian independence.

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

30 January-1 February (Monday-Wednesday): CI Capital’s Annual MENA Investor Conference 2023, Cairo, Egypt.


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.

23-27 February (Thursday-Monday): Annual Business Women of Egypt’s Women for Success conference.

MARCH 2023

March: 4Q2022 earnings season.

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

APRIL 2023

1 April (Saturday): Deadline for banks to establish sustainability unit.

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).

30 April (Sunday): Deadline for self-employed to register for e-invoicing.

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

10 June (Saturday) Thanaweya Amma examinations kick off.

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.

End of December/early January: SFE’s pre-IPO fund to kick off roadshow.

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

4Q 2022: Raya Holding subsidiary Aman and Qalaa Holdings’ Taqa Arabia to launch their fintech company.

4Q 2022: Saudi Arabia’s Jamjoom Pharma to inaugurate its EGP 1 bn pharma factory in El Obour.

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.

1Q 2023: Internal trade database to launch.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.