WHAT WE’RE TRACKING TODAY

The next (and potentially final) session of the Cairo Criminal Court trial of former Al Jazeera English journalists and other defendants gets underway this morning.

Even politicians are worried about what might happen with Greece: Here’s a picture of the ATM queue inside the Greek Parliament. Greece will shutter its banks today in a bid to keep the banking system from total collapse, the WSJ and Reuters report. The Athens Stock Exchange will also be closed. If you’re watching the “Grexit” crisis unfold and haven’t already done so, follow Finance Minister Yanis Varoufakis on Twitter (he writes his own). Varoufakis is more insightful (and pungent) on Twitter than is Prime Minister Alexis Tzipras. Need more? NPR’s Planet Money has had solid coverage of the Greek crisis for going on four years now. We’d recommend episodes including:

• The Dream of Europe and the Bailout of Greece (September 2011)

• Who Loaned Money To Greece, Anyway? (January 2012)
• The Amazing Shrinking Economy Might Stop Shrinking (March 2014)
• Hey Big Spender (February 2015)

Okay, so, when can we eat? Maghreb will be at 7:01pm today, while fajr will be at 3:11am, according to Islamic Finder.

WHAT WE’RE TRACKING THIS WEEK

The deadline for Iran to reach a nuclear accord with the P5+1 countries expires tomorrow (30 June). Then again, maybe not.

Wednesday, 1 July is a holiday for public-sector banks and the EGX as state institutions prepare for the 2015-16 fiscal year, according to a statement from the Ministry of Manpower.

Emaar Misr shares will begin trading on the EGX on Thursday, 2 July.

Greeks will go to the polls on Sunday, 5 July in a snap referendum on whether to accept the European Central Bank / IMF / European Commission’s take it or leave it proposal.

LAST NIGHT’S TALK SHOWS

Amr Adeeb and Khaled Abu Bakr spent the first hour of their program complaining about the slow pace of investment in the country. Then they turned their attention to Daesh. Adeeb asked the question, Is Daesh stronger or weaker than it was a year ago? “Last year at this time we were talking about an organization with 3,000-4,000 members. Their numbers have multiplied and their influence has spread beyond belief. Now we have a warning from Daesh that there will be a Ramadan attack on Egypt. Why aren’t we doing anything about this? Terrorism in Egypt, the Gulf and around the world will not come to an end if we continue to do nothing,” said Adeeb.

Adeeb criticized the Arab League statement supporting Qatar’s right to host the 2022 World Cup. “With all that is going on around us is this really what’s bothering them the most? Why are they so upset that we aren’t taking Qatar’s side in this?”

Adeeb and Abu Bakr tore apart a proposed draft of Egypt’s new media law, particularly an article that allegedly states that foreign entities cannot own media in Egypt. “There are a lot of things in this proposed draft that definitely won’t fly. This is one of them. It’s a start I suppose,” said Abu Bakr.

Adeeb suggested that there shouldn’t be set penalties for libel, it should rather be left up to the discretion of the court with no ceiling on financial penalties. He thinks that the law is so full of inconsistencies that it will be another 10 years at least before it sees the light of day.

** READ ENTERPRISE IN ARABIC **

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SPEED ROUND

Picking up where we left off yesterday, it is confirmed that Ezz, Suez, and Beshay steel plants have been cut off from the gas network: EGAS halted supplies to steel plants completely since the beginning of Ramadan in order to channel more natural gas to power plants to cope with the higher demand for electricity, a source told Al Borsa. The source said EGAS will only resume supplies after a surplus of electricity production is reached. Steel factories’ gas demand amounts to a total of 275 mcf per day. A steel supply shortage is thus expected after Ramadan, the Chairman of the Chamber of Metallurgical Industries said.

Emaar Misr has officially announced that its IPO was covered 35.8 times, in a disclosure sent to the EGX. Subscribers will receive 2.78% of the value of shares they demanded and investors will be reimbursed for extra amounts today.

Plans for national telecoms infrastructure agency scrapped: The CIT Ministry has officially withdrawn from establishing the national telecommunication infrastructure entity, Al Borsa reported. The project is replaced with discounts provided by Telecom Egypt to mobile operators to use its network infrastructure. A government source said the decision to cancel the initiative came following a number of technical and administrative obstacles faced including the reluctance of the mobile operators to engage in more negotiations with the government. A major issue that faced the CIT Ministry was the Defense Ministry’s insistence on having local companies control at least 60% of the project.

Auto assemblers prepare to ask for government support: Top figures in the automotive industry and members of the Chamber of Engineering Industries held talks at the Federation of Egyptian Industries yesterday on the contours of a package that would both stimulate domestic demand for automobiles and afford domestic assemblers a measure of protection against imports from countries with preferential tariff agreements, including the EU, Turkey and Morocco. Measures on the table include a state-backed national vehicle replacement program similar to the successful “white cab” taxi replacement program; government encouragement of banks to extend more financing to would-be car buyers; and a package of tax breaks and other incentives for assemblers who go further down the value chain into manufacturing, raising their local content component to 58% over a 15-year period from 40% today. The final package of recommendations will be presented to Trade and Industry Minister Mounir Abdelnour. The news comes as members of the Automotive Marketing Information Council (AMIC), the industry association of record, reported a 22% year-on-year decline in passenger car sales. Total vehicle sales (including trucks, pickup trucks and other commercial vehicles) fell 14% year-on-year to 20,200 units; bus sales were the bright spot, rising 14%.

No new GCC aid in 2015-16, Gulf patience wearing thin? A report in Al Masry Al Youm translated by English-language subsidiary Egypt Independent raises questions about whether Cairo’s backers in the UAE, Saudi Arabia and Kuwait may be losing patience with the Mahlab government in lock-step with the domestic business community. In a classic case of burying the lede, the reports opens noting that a senior government official believes it unlikely the GCC countries will provide additional aid in the upcoming fiscal year. The story then goes on to note that some USD 6 bn in GCC assistance pledged at the Egypt Economic Development Conference in Sharm back in March has yet to be delivered because of foot-dragging on both project implementation and the issuance of the executive regulations for the new investment law.

Export subsidies have not doubled: Export subsidies will remain fixed at EGP 2.6 bn in the 2015-16 budget, said Trade and Industry Minister Mounir Abdelnour, contradicting earlier media reports that the subsidies would double to EGP 5 bn. Al-Masry Al-Youm quotes Abdelnour as suggesting budgetary constraints were behind the decision to leave the export subsidy line item unchanged this year. Egyptian exports fell by 20% during the first five months of the current calendar year, the newspaper says.

Hepatitis campaign rolls out to military personnel: The Sisi administration will provide without charge treatment courses of Sovaldi, the Hepatitis C cure, to serving members of the armed forces infected with the virus, Ahram Online reported. Regular readers know we been covering rather extensively in our Healthcare section (below) the administration’s campaign to roll out the drug — which has a c. 89% cure rate — to low-income earners in partnership with the patent holder and generic drug manufacturers. We’ve also crossed paths with three non-commissioned officers (amin el-shorta) in the police service in the past month who have begun state-funded courses of the drug, which we’re taking as anecdotal evidence that unlike AIDSkofta, the state is running a genuine public health program in this instance. In other military-related news, the Official Gazette carried news today that the recent 10% pension hike will also benefit veterans of the armed forces, Aswat Masriya notes.

El Watan provided us with our first glimpse of the controversial draft Media and Journalism Act on Monday. The most contentious sections of the draft are articles 64, 65, and 66, which aim to eliminate ‘foreign interference’ in Egypt’s media space. Section 1 of Article 64 requires that any Egyptian media outlet disseminating news on television, radio, or the internet be wholly-owned by Egyptian citizens. Article 65 and 66 provide additional qualifications for the management and ownership of media companies, again with the aim of limiting foreign involvement in media. Article 66, for instance, requires that the heads of media companies would need to be an Egyptian citizens who are members of the Press Syndicate. (Read in Arabic)

25 people reportedly arrested in Fifth Settlement for not fasting, MOI spox unaware of the arrests: Ahram Online makes mention of recent media reports that “25 people were arrested in the upscale Fifth Settlement district … for eating and drinking in public.” The report notes that following the news, Interior Ministry spokesman Abu-Bakr Abdel-Kareem told ONTV that he was unaware of the arrests, but that if they were arrested for not fasting, the matter would be investigated. “We can’t put in place a law that contradicts the Qur’an,” he said. (Which technically is also not true, but let’s just take this one step at a time.)

Egyptians are more generous during Ramadan, a survey by Daily News Egypt concluded. Charitable foundations are seeing a larger influx of funds in the first days of Ramadan through their respective bank accounts. According to the head of operations at the Housing and Development Bank, the Misr El Kheir Foundation, Magdy Yacoub Heart Foundation, and 57357 Cancer Hospital are receiving the most donations.

Turkey accused of allowing Daesh to cross border to attack Kurdish town of Kobane, where 200 Kurds were slaughtered: Kurdish forces have since reported retaking the town after a massacre of c.200 people due to bombings and sniper fire, the Telegraph reports. The accusation that the Daesh fighters had crossed over from the Turkish border was made by eyewitnesses speaking to Kurdish forces, Kurdish politicians in Turkey, and Syrian state media, though Turkey is adamantly denying the allegations. (Read)

Spanish league challenging FIFA switch to a winter World Cup in 2022: On Sunday, the AP reported: “The Court of Arbitration for Sport says the Spanish league (LFP) has filed an appeal against the FIFA decision, which avoids the Qatari summer heat … A November-December tournament would shut down top European leagues for eight peak weeks and require more summer fixtures. It is the first formal legal challenge to moving the World Cup in Qatar from the traditional June-July slot.” (Read)

El Ahly defeated their North African rivals El Taraji 3-0 on Monday in Cairo (Watch, running time 2:49). Meanwhile, up-and-coming Alexandria outfit Smouha, came back from a two-goal deficit to defeat Morocco’s Eltetouan in a CAF Champions League match, held in Alexandria on Monday. (Watch, running time 1:51)

SPOTLIGHT ON recent developments in Israeli gas

After drawn-out bureaucratic hurdles in Israel over the development and export of its natural gas, events have accelerated rapidly in the past few days. On Thursday, Israeli ministers with “security responsibilities overrode the antitrust authority’s objection to a contested gas policy,” declaring Israel’s “natural gas resources a national security interest,” as reported by Bloomberg.

The Israeli cabinet on Sunday then voted to override the antitrust authority’s objections to the development of the gas fields by Noble Energy and Delek, according to The Times of Israel. This followed demonstrations by thousands of Israeli protesters on Saturday evening on the then-pending cabinet decision on gas policy, leading to clashes with the police.

Meanwhile, US Secretary of State John Kerry found himself at the center of a controversy in the Israeli media on Thursday, when information on his holdings in Noble Energy stocks — information which has been publicly available for years — came to light in an attempt to demonstrate a conflict of interest in his involvement in gas agreements between Israel and Jordan. Secretary Kerry’s holdings in Noble Energy, according to his 2013 asset declaration hosted by the Center for Responsive Politics and as reported by The Blaze, comprised a negligible USD 0.5-1 mn of his overall net worth of c. USD 200 mn, according to a 2012 report by CQ Roll Call.

Meanwhile, Simon Henderson of the Washington Institute noted earlier this month that “On June 15, President Nicos Anastasiades of Cyprus held a working lunch with Israeli prime minister Binyamin Netanyahu in Jerusalem,” whose discussions he speculates focused on natural gas, given that “on June 7, the Cyprus Energy Ministry declared the [Aphrodite gas] field to be commercial, prompting Noble and Delek to submit a development plan on June 11. Their plan calls for a floating production storage and offloading (FPSO) vessel to be located over the field, which lies in deep water more than 100 miles south of the island, close to its maritime border with Israel. While the plan does not mention where the gas would be exported, the obvious destination is Egypt,” (Read)

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A MESSAGE FROM PHAROS HOLDING

Edita: Exceptionally well-positioned for value-accretive M&A transactions

Pharos Holding Research has initiated coverage on leading Egyptian snack foods producer Edita, which recently listed on the EGX after two partners sold a combined 30% stake in a secondary offering in March 2015. At first, the firm traded on a 25.2x PE multiple that has since shot up to 40x, which Pharos Research has deemed justifiable, particularly in light of its ongoing expansion drive.

Our take: Edita’s trading multiple is a fair reflection of a combination of the FV estimate derived from its DCF valuation — which is based on a projected revenue CAGR of 18.5% until 2020, an average GPM of c. 40% and annual SG&A/Sales ratio of 17.5% — and Edita’s plans for capacity expansion.

Another key: Edita has high potential for M&A transactions as either a buyer or as an acquisition target in its own right. Industry giant Kellogg’s has already entered Egypt in early 2015 through acquiring Bisco Misr and other regional giants, such as Turkish Ulker, are aggressively seeking growth opportunities in Egypt and selected other MENA region countries, such as Saudi Arabia. We believe Edita’s dominant market share in the cakes and croissants segments — and the firm’s successful shift in distribution policy towards retail clients — are highly-valued intangible assets. Click here to read our full initiation report.
***

EGYPT IN THE NEWS

The FT pins blame on Egypt for both Jordan and Israel of losing out on Turkish trucking business following Egypt’s cancellation of its ro-ro agreement with Turkey, Turkish shippers no longer find it economically feasible to continue taking trucks to Haifa, at which point they would continue on to Jordan.

The Economist decided to print a whitewash on Nader Bakkar and Hezb el Nour for reasons unknown and unknowable. “The young spokesman for the Nour party is tolerant, reasonable and smart — he is about to begin a fellowship at Harvard.”

WORTH READING

Islamist-enabling liberals have derided the Ministry of Awqaf’s recent tightening of oversight on religious life in Egypt, including closures of unlicensed mosques, the ban on unlicensed imams, and the removal of extremist literature in mosque libraries. Yet when we look at Tunisia and the recent attacks from which the country has suffered, two clear reasons emerge: proximity to Libya, which the international community has allowed to collapse — a collapse only hastened by the Ikhwan’s armed seizure of Tripoli. More worryingly, Tunisia has been the point of origin for a disproportionately high number of salafist fighters waging jihad in Syria, contrasted by the relatively high level of education and culture. Why is there such a disparity? A report from West Point’s Combating Terrorism Center from one year ago says it all:

“In the months that followed the 2010-2011 revolution, several hundred imams were replaced, often by violent Islamists who accused the imams of having collaborated with the former Ben Ali regime.By October 2011, the Ministry of Religious Affairs announced that it had lost control of about 400 mosques. The ‘uncontrolled’ classification means that a mosque’s imams are operating without the official authorization of the Ministry of Religious Affairs. To become an ‘authorized’ preacher, one needs to either have a relevant education at the Zitouna institution or take a special exam. Since October 2011, the state tried to reestablish control over these 400 mosques. On March 13, 2014, the Ministry of Religious Affairs estimated that 149 mosques remained out of government control; yet earlier the same month, the Ministry of Interior put the number of uncontrolled mosques at 380, in what illustrates the unreliability of publicly available figures. The latest official figure from May 2014 estimates that around 90 mosques remain out of government control. Most of the uncontrolled mosques are located in the densely populated Sahel region, a key destination for tourists.” [Note that Sousse, the site of the recent attack, is known as “the Pearl of the Sahel] (Read The Radicalization of Tunisia’s Mosques)

On the other side of the region, we see countries choosing to empower extremists in their mosques. In last week’s Qatar’s Foundation for Hypocrisy by Jamie Dettmer of The Daily Beast:“Saudi cleric … Abdulaziz al-Fawzan … preached at the Education City mosque [in Doha] just one week afterISIS mounted a suicide bombing in eastern Saudi Arabia targeting a Shia mosque that killed 21 people and injured more than 100 others. Abdulaziz al-Fawzan is virulently anti-Shia” and “has also urged Muslims to ‘hate’ Christians and explained the 2004 Southeast Asia tsunami as divine retribution … U.S. Ambassador Alberto Fernandez, who recently retired as coordinator of the State Department’s Center for Strategic Counterterrorism Communications, has described al-Fawzan as ‘one of the worst.’”

WORTH WATCHING

The unmanned SpaceX Falcon 9 rocket disintegrated minutes after liftoff on Sunday, where it had been headed to the International Space Station. (Watch, running time: 1:20)

ALSO WORTH WATCHING- SELF HELP AND INFORMAL SETTLEMENTS- With regard to recent reports that both the UAE will assist Egypt in developing 10,000 housing units in Egypt’s informal areas, as well as a new government plan announced dubbed “Egypt Without Slums” which aims to “eradicate” (read: develop) 258 informal settlements within the space of three years, the concept of assisted self-help in low-income housing is critical to an understanding of the issue.

Self-help in housing has become a strong theoretical foundation and a practical and functional basis for public interventions in upgrading informal settlements, Iman Salama writes. As building in informal areas continues to grow, with some estimates claiming that 65% of the urban population in Egypt living in informal settlements, the importance of analyzing the informal housing is essential. Salama, who is currently pursuing a PhD in Geography at the University of Geneva on the socio-spatial dimensions of the incremental development process of popular neighborhoods in Cairo, created a critical short movie to address the role of the user, the state, and housing experts in self-built informal housing(running time 14:06). She addresses the issues in post on the Cairobserver blog.

DIPLOMACY

11 new ambassadors to Egypt have presented their credentials to President Abdel Fattah El Sisi. Among them, per the front-page story in Al-Ahram:

• Australia — Neil Hawkins
• Brazil — Ruy Pacheco de Azevedo Amaral
• Brunei — Abdul Kahar Hussin
• Columbia — Diego Cardona
• Cyprus — Charis Moritsis
• India — Sanjay Bhattacharya
• Pakistan — Mushtaq Shah
• Panama — Thomas Williamson
• Ukraine — Hennadii Latii
• Vatican — Archbishop Bruno Musarò
• Zambia — Ali Simwinga

Dore Gold, director-general of Israel’s foreign ministry, “made a rare trip to Egypt on Sunday to discuss how to re-launch peace talks with the Palestinians,” Reuters reported. Gold met senior Egyptian officials to discuss “how to push the peace process forward,” Egypt’s state news agency MENA reported, citing Egyptian foreign ministry spokesman Badr Abdelatty. Israel’s foreign ministry also confirmed the visit in a statement.

Saudi Ambassador to Egypt Ahmed Qattan, dean of Arab ambassadors to Egypt, held an iftar for Arab ambassadors and senior Egyptian Foreign Ministry staff at his official residence, according to a press note from the Saudi Embassy.

ENERGY

Mahlab inaugurates first solar panel production plant
Al Shorouk, Aswat Masriya | 28 June 2015
Prime Minister Ibrahim Mahlab attended the inauguration of the first Photovoltaic solar cells production line at the headquarters of the Arab Company for Renewable Energy, a subsidiary of the Arab Organization for Industrialization. The factory cost EGP 24 mn and outputs 52 MW annually. AOI had constructed a 600 KW solar power station on the Cairo-Suez desert road and connected it to the national grid in 2010, according to Samir Darwish, CEO of the Arab Company for Renewable Energy. He added that his company is looking to upgrade the station’s output to 1 Megawatt in the coming period. The news is also front-page in Al-Ahram. (Read in Arabic or in English)

EGAS still assessing LNG import offers, second FSRU to pump 700 mcf per day
Youm7 | 27 June 2015
EGAS is still assessing the proposal presented to import LNG technically, Khaled Abdel Badie, the Chairman of EGAS said. EGAS aims to begin operating a second FSRU in September and to have it pump 700 mcf of gas into the national grid per day. Abdel Badie added that a new LNG import tender will be issued this week for the new FSRU and EGAS is yet to finalize the list of companies it will contact for the tender. (Read in Arabic)

Rosneft signs petroleum products supply agreement with Egypt
Ship and Bunker | 26 June 2015
Rosneft announced the signing of an MoU with EGPC to supply petroleum products to Egypt. Rosneft said the two parties signed a document that “[t]he signed document envisages cooperation in the area of Gasoil, Gasoline, Fuel Oil, LPG & Bitumen supplies.” The Russian producer said the cooperation with EGPC will enable it to “supply products directly into Egypt increasing the company’s netbacks along the value chain.” (Read)

INFRASTRUCTURE

Egyptian Energy Transmission Co spends EGP 1.7 bn this year
Al Mal | 28 June 2015
The EETC has spent EGP 1.7 bn on energy transmission projects this year, according to president of EETC Ahmed Hanafi. The government had allocated EGP 2 bn for transmission projects of which EGP 300 mn were saved, he added. (Read in Arabic)

Abu Aouikel water plant Project to commence in August
Amwal Al Ghad | 28 June 2015
As part of the Housing Ministry’s strategy to manage loans and grants given to the State, Housing Minister Moustafa Madbouly announced the Abo Aouikel power plant project will commence next August with a Saudi loan of USD 225 mn, after the issue of pipes leaving the plant was resolved. Madbouly added that the ministry will follow up, weekly, on the progress of all projects funded by loans and grants, as to not increase the State’s debt. (Read in Arabic)

BASIC MATERIALS & COMMODITIES

EGP 1.2 bn allocated to add 6 mn newborns to ration cards
Amwal Al Ghad | 28 June 2015
The new budget allocated EGP 1.2 bn towards including 6 mn newborns onto the ration card system, says Public Authority for Supply VP Mamdouh Abdel Fattah. Prime Minister Ibrahim Mahlab had issued a ministerial decree to include newborns born between 2006 and 2011 on the ration card system starting next July. (Read in Arabic)

MANUFACTURING

New subsidies for chemical and fertilizer industries will not drive export growth, says Hani Cassis
Al Masry Al Youm | 28 June 2015
Increasing the subsidies for chemicals and fertilisers will not result in an increase in exports, Hani Cassis, the member of the Chemical Industries Export Council told Al Masry Al Youm. The story erroneously notes that the government its budget allocation for export subsidies to EGP 5 bn from EGP 2.6 bn, but Cassis expects exports to fall by more than 30%. He adds that the increase in export support is not backed by new investment opportunities or new investments in exporting sectors. The subsidy increase did not address the root cause of the drop in exports, Cassis noted. As we explain in Speed Round, above, elsewhere in AMAY the newspaper reports that Trade and Industry Minister Mounir Abdelnour said the government has scrapped plans to double export subsidies. (Read in Arabic)

Sidpec offered financing from five banks, partners with Eni and BP
Egypt Oil and Gas | 25 June 2015
Five local banks have offered to finance Sidpec’s USD 600 mn ethylene production project, according to Sidpec’s Chairman, Ahmed Helmy. The project has an annual production of 200k and the banks offering the funding include NBE, AAIB, Banque Misr, and CIB. Helmy added that “the partnership project with United Gas Derivatives Company in alliance with [Eni] and [BP] entered the phase of providing preliminary information which will take three months before commissioning an international advisory office to conduct the final feasibility study.” (Read)

Executive regulations of new mining law ready
Amwal Al Ghad | 28 June 2015
The executive regulations for the new mining law were issued on 24 June, allowing investors to negotiate with the Egyptian Mineral Resources Authority (EMRA) on new mining locations, said EMRA President Omar Taeema. The new law does not prohibit export entirely, only raw materials in their most basic form as EMRA looks to push domestic producers further up the value chain to become producers and exporters of final products. Cabinet had previously issued a decree to ban the export of eight raw minerals, but after studies only four bans were implemented. (Read in Arabic)

HEALTH & EDUCATION

Ministry of Health decree shortening pharmaceutical registration periods
Youm7 | 28 June 2015
Health Minister Adel Adawi issued a decree shortening registration periods for new pharmaceuticals and allowing procedures to run in parallel rather than in sequential order, according to the minister’s deputy for pharmaceuticals, Tarek Suliman. The decision comes in light of drug shortages due to a lack of substitute drugs on the Egyptian market. (Read in Arabic)

REAL ESTATE & HOUSING

Saudi Arabia’s Babel to invest EGP 300 mn in Egypt
Al Borsa | 28 June 2015
Saudi Arabia’s Babel for Maintenance, Operations, and Trading is planning to invest EGP 300 mn in the Egyptian real estate sector within a year. Babel is looking for partners to invest with in New Cairo and the North Coast. The company is also looking to bid on Housing Ministry projects. (Read in Arabic)

AUTOMOTIVE & TRANSPORTATION

City Transport Group inks EGP 500 mn bus agreement with CTA; GB Auto to get cut of transaction
Al Mal | 28 June 2015
Ukraine’s City Transport Group has agreed to supply the Cairo Transportation Authority with 290 new eco-friendly buses. The Ukrainian company inked the EGP 500 mn agreement with Cairo Governorate on Sunday; Prime Minister Ibrahim Mahlab and the governor of Cairo were in attendance. The agreement is part of the governorate’s strategy to modernize its aging bus fleet, said the governor. The Ukrainian company will provide spare-parts and maintenance service for all of the coaches for a seven-year period. The buses will be assembled locally at one of GB Auto’s assembly facilities, adds the source. (Read in Arabic)

Armaments Authority, Arab Organization for Industrialization to restructure ENR
Al Borsa | 28 June 2015
The Armaments Authority and the Arab Organization for Industrialization will examine 354 faulty locomotives and present technical and financial offers before 30 June to refurbish them. The two authorities are already refurbishing a number of trains and locomotives, Transport Minister Hany Dahy said. (Read in Arabic)

BANKING & FINANCE

NBE extends EGP 50 mn credit line to Emirates Misr
Al Borsa | 28 June 2015
NBE will extend an EGP 50 mn facility to petrol station owner Emirates Misr to build two new filling stations, one in Rehab City and another at Cairo Festival City. The new funding will bring the total volume of the credit facilities extended to the company to EGP 100 mn. (Read in Arabic)

Emirates NBD aiming for a 25% y-o-y growth in 2015
Daily News Egypt | 27 June 2015
Emirates NDB is aiming for a 25% y-o-y growth in all its activities in Egypt in 2015, Deputy MD Sahar El Damati told DNE in an interview. Emirates NBD currently funds 22 sectors including energy, electricity, petroleum, communications, construction, steel, cement, and food. The bank has a special interest in funding SMEs, and they currently take up about 30% of the loan portfolio. Emirates NBD plans to increase its branch network to 100 branches from 67 currently, El Damati said. (Read)

OTHER BUSINESS NEWS OF NOTE

Eastern Company renews British American Tobacco contract
EGX Disclosure and Al Mal | 28 June 2015
The Eastern Company renewed British American Tobacco’s (BAT) contract to manufacture foreign cigarettes for a period of seven years starting next July, reports Al Mal. BAT paid Eastern Company USD 5 mn as a signing bonus. Eastern Company has made a profit of EGP 841.8 mn in the six months ending in March 2015, versus EGP 704.7 mn in the same period last year. (Read the EGX Disclosure Arabic)

Saudi-Emirati Company with EGP 500 mn capital inaugurated in July
Al Shorouk | 28 June 2015
A group of Saudi Arabian and Emirati investors are in the process of founding an EGP 500 mn capital company to work in the fields of trade, food and real estate, according to sources close to the investors, Al Shorouk reported. The company has bought a 20 acre plot of land in the Fifth Settlement to build a housing project. The chairman of this new company is the Saudi businessman Mohamed El Akil, the general manager of Dar Al Maaly for Development and Investment Real Estate. (Read in Arabic)

LEGISLATION & POLICY

Amendments to the Suez Canal special economic zone approved by El Sisi
Daily News Egypt | 27 June 2015
President El Sisi approved amendments to the laws governing special economic zones, including the one for Suez Canal area. DNE reports that “the amendments stipulated that the general authority, that is to [be] formed to manage the zone, has the right to participate in launching one or more major companies to develop the area, or to license others to launch this company.” Hany Sarie Eldin, the legal adviser of the Suez Canal Area Development Project, told DNE “that over the next few days the procedures of forming the general authority of the economic zone will take place, including a head for the authority and nine members, four of whom represent the related ministries and governorates.” (Read)

EGYPT POLITICS + ECONOMICS

Egypt to negotiate with Russia increasing the capital of the joint investment fund
Al Borsa | 28 June 2015
Egypt will engage in negotiations with Russia to increase the capital of the proposed mutual investment fund between the two countries to USD 2 bn, Industry and Trade Minister Mounir Fakhry Abdel Nour said. The fund will be used as a financing vehicle for industrial and services projects. Abdel Nour said the Ministry is also in talks with NBE and Banque Misr to contribute to the fund. (Read in Arabic)

Egypt officially joins China’s Silk Road Economic Belt Union
Daily News Egypt | 27 June 2015
Egypt has joined the Silk Road Economic Belt trade union and will be represented by the Egyptian Businessmen Association (EBA), Daily News Egypt reported. The union includes 92 Chinese and foreign associations. China aims to raise USD 2.5 tn in trade between the member countries and associations in 10 years. (Read)

Mahlab visits Toshka project today
Al Shorouk | 28 June 2015
Prime Minister Ibrahim Mahlab will be visiting the site of the Toshka project to assess accomplishments and hindrances since his visit in Ramadan of last year. His visit will encompass the main mn acres land reclamation project, as well as the accompanying housing projects. (Read in Arabic)

ON YOUR WAY OUT

EGPC issued a tender seeking up 175,000 tonnes of gasoline for delivery in August, Reuters reported. EGPC would “like three cargoes of 30,000 to 35,000 tonnes each of 95-octane gasoline for delivery into Alexandria port” with delivery dates from 1-3 August, 13-15 August, and 22-24 August. The state-owned firm is also looking for two cargoes of 30,000-35,000 tonnes each of gasoline for delivery into Suez port on 2-4 August and 20-22 August.

AAIB profits went up to EGP 398 mn compared to EGP 282 mn last year. Total assets grew 15.2%  from last year, reaching EGP 91 mn at the end of last March from EGP 79 mn from the same time last year. Meanwhile, client deposits went up 11.4% reaching EGP 72 bn from EGP 64 bn last year, Amwal Al Ghadreported.

12 Maspero officials face charges for loss of historical footage: Deputy President of the Administrative Prosecution Authority Naji Abdul Hamid referred 12 Maspero officials to an urgent trial for allegedly being involved in the loss or destruction of archival footage detailing the history of Egyptian television, Youm7 reports. Investigations allegedly revealed that most of the accused failed to fulfill necessary procedures and misused the financial assets of the state, while neglecting to preserve dozens of recorded tapes of historical value.

Imprisoned photojournalist Shawkan’s health deteriorating: The family of imprisoned photojournalist Mahmoud Shawkan organized a protest in front of the Journalism Syndicate today demanding Shawkan’s release, according to Al Shorouk. Shawkan has been imprisoned without trial since August 14, 2013. The photojournalist suffers from Hepatitis C and prison officials refuse medications to enter the facility, according to Shakwan’s brother Mohamed, who said that Journalism Syndicate president Yahya Qalash informed him that the syndicate will send an official letter to the Prosecutor General Hisham Barakat calling for his release.

It’s the classic dodge of consultants the world over: Write a study or publish a ranking pointing out a problem. Convince the media to write about it. “Monetize” by selling against the demand you’ve just created. In this case: Publish Bloom Consulting Country Brand Ranking at the beginning of the year (pdf download). Earn media coverage in Daily News Egypt. Sell against it? The bright side, from our point of view: The CEO of the consultancy in question at least takes a swipe at GAFI, which he refers to only as the “investment promotion agency” and whose “online performance” is (admittedly) lacking. Happily for GAFI, Bloom Consulting has solutions…

A small IED exploded outside the Saudi consulate in Garden City yesterday, Ahram Onlinereports, possibly the same device as Al-Mal claims went off near Qasr Al-Nil police station. In related news, two would-be bombers blew themselves up near Damanhour on Saturday before they could set off their device.

Paris Hilton was on Ramez’s latest Ramadan idiocy. A good time was not had by all, reports the Huffington Post.

BY THE NUMBERS

USD CBE auction (Sunday, 28 June): 7.5301 (unchanged since Monday, 02 Feb)
USD parallel market (Sunday, 28 June): 7.69 (+0.01 from Sunday, 7 June, Reuters)

EGX30 (Sunday): 8,511.98 (+1.26%)
Turnover: EGP 319.3 mn (33% below the 90-day average)

WTI: USD 58.80 (-1.39%)
Brent: USD 63.26 (unchanged)

TASI: 9,208.7 (-1.7%)
ADX: 4,719.3 (-0.9%)
DFM: 4,056.0 (-2.2%)
KSE Weighted Index: 420.8 (-0.3%)
QE: 12,083.0 (-0.4%)
MSM: 6,432.3 (-0.2%)