TL;DR

• Global markets tank in the wake of China’s ‘Black Monday’
• Will a new ‘war on corruption’ help the medicine of reform go down easier with the public?
• El Sisi arrives in Moscow, with nuclear accord for Daba’a expected
• Electricity prices just rose
• Abraaj closes USD 375 mn raise for second North Africa PE fund
• Egyptian internet to meet “international standards” by end-2016
• New in ‘Egypt in the News’: What the Arab press is saying about Omm El-Donia

WHAT WE’RE TRACKING TODAY

Yesterday was not an easy day for global stock markets, and one question — and only one — is on the minds of many this morning: Are we in the early days of another global financial crisis?China’s benchmark Shanghai Composite index dropped 8.5%, wiping out all gains made this year with European stocks also dropping by more than 5%. “It is a China driven macro panic … Volatility will persist until we see better data there or strong policy action through forceful monetary easing,” Didier Duret, chief investment officer at ABN Amro, told Reuters. Brent crude trading in London dropped below USD 45 per bbl, extending a 7.3% drop from last week. The WSJ said “global growth concerns continued to spook investors around the globe” and within a few minutes of trading the Dow Jones Industrial Average had already dropped more than 1,000 points before regaining ground to close the day down 588 points, an 18-month low. Emerging markets currencies have been particularly hard hit

Following last week’s 5% tumble of the S&P 500, Bloomberg’s Julie Verhage took an optimistic stance, saying that following 28 previous similar drops since 1980 “the market is relatively flat the next week, up 1.65 percent over the next four weeks, and up close to 5 percent over the next 12 weeks. Also important to note is that 60 percent of the time, the index moves higher the following week.”

It already feels like we’re in that other 40% of the time.

Could it be, as Bloomberg suggests, that Asian economies are more resilient now than they were in the run-up to the 1997 Asian economic crisis? Yes. But with interest rates around the world near historic lows, policymakers have few levers to pull if they’re looking to boost growth. It’s a point so obvious even Rupert Murdoch can see it, Tweeting: “If new recession biggest nations have few tools left to fight it.  mountains of cash everywhere, but nobody investing.”

Turning to everyone’s favorite Egyptian-Californian, Mohamed El-Erin told Bloomberg last night that he’s not sure this is a major crisis: “I’m not a buyer that this is the crisis of all crises. Yes, this is a very unpleasant re-pricing, very unpleasant. And it’s going to go quite deep, but it’s not going to derail the economy in a major way.”

Oh, and the notion that the EGX somehow did better than most yesterday? That’s an artifact of the EGX30, which was down only 1.9% because CIB shares were up a bit more than 0.8%, dampening the larger drops of other companies listed in Cairo. EFG Hermes was down more than 7.5% for the day, Qalaa Holdings shed more than 8.4%, Amer Group dumped 8.3%, Palm Hills nosedived 7.2% and GB Auto lost nearly 6.6%, to cite but a handful of examples.

Borscht, anyone? President Abdel Fattah El Sisi is in Moscow today for a three-day state visit.Beyond the usual pleasantries on trade and pledges of backing on security issues, we’re looking for Rosatom to be awarded the contract for at least one nuclear reactor at Daba’a. El Sisi met with Rosatom CEO Sergei Kirienko back in June, with Ittihadiya releasing an unusually detailed readout for a courtesy call, including a note that, “Mr. Kirienko presented a proposal to build a nuclear power plant to generate electricity in Egypt using the latest technology. He noted that the plant would include four electricity generating units, meeting the highest standards of nuclear safety. He added that the project will provide 20,000 jobs in infrastructure and 6,000 jobs in the operation phase. In addition, 1,000 scholarships in the field of nuclear energy will be granted to Egyptian students to attend Russian universities.”

Also on the table in Moscow: Talks on a free-trade pact, a Russian economic zone in Egypt, and possible joint ventures between Egyptian companies and Gazprom and Rosneft. See “Diplomacy,” below, for more on the subject.

ON THE HORIZON

The Future of Energy in Egypt envisions Egypt becoming one of the Middle East’s top five energy exporters by 2030. The summit, taking place 31 August – 1 September in Cairo, is set to look at how to turn that goal into a practical reality. Organized by Future Energy Corporation, the summit will be attended by leading figures in the energy sector and related industries.

Senior officials from the ministries of transport, environment, supply, and trade and industry will be attending Pharos 2015 in Cairo from 1-3 September. The international conference for logistics, ports and shipping conference and expo will cast the Suez Canal Axis development project in the spotlight, Al Mal reports. The (very slow to load) conference website is here.

Nominations for the two-stage election for the House of Representatives open on 13 September, according to prevailing wisdom in the capital city. Citizens are expected to head to the polls on 25 October and 21 November.

LAST NIGHT’S TALK SHOWS

Magdy El Galad, filling-in for Lamis El Hadidy, devoted Monday night’s episode of Hona El Assema to coverage of President Abdel Fattah El-Sisi’s visit to Russia. El Galad praised the Foreign Ministry and El Sisi for developing strong ties to Russia, of which he spoke in glowing terms.

El Galad: “This visit is of utmost importance. In addition to meeting Mr. Putin, President El Sisi is scheduled to meet with Russian parliamentarians, the Trade and Industry minister, and the CEO of the Russian Direct Investment Fund. The meetings will aim to expand Egypt’s commercial ties to Russia.”

Later in the program, Samy Emara, Al-Ahram’s Moscow bureau chief, called-in to provide additional detail on the visit.

Emara: “This is third meeting between Presidents El Sisi and Putin over the past year and a half. … Putin deeply respects our president; he has made this clear on numerous occasions. In several of his addresses, Putin stated that President El Sisi saved Egypt from becoming like other countries [Syria, Libya, and Iraq] in the region.”

According to Emara, the heads of state will discuss the war against Daesh and their countries’ joint efforts to build a nuclear power plant in Daba’a on the northern coast of Egypt.

A new face appeared as lead host on Monday’s night’s episode of Al Qahera Al Youm, with Maryam Aminfilling-in for Amr Adeeb. Amin focused the bulk of her program on coverage of the fatal heatwave that hit Cairo over the past month. Dr. Maher Aziz, an energy and climate specialist, was the night’s guest.

Amin: “What caused this exceptional heatwave?”

Aziz: “It quite simple. It was caused by global warming. Over the next 20 years, the average global temperature may increase by over two degrees Celsius, as a result of global warming. We will likely experience  in the years to come heatwaves similar to the one we experienced this summer. Consequently, it is imperative that the government establish a countrywide heatwave warning system in order to prevent even higher death rates in the future.”

** SHARE ENTERPRISE WITH A FRIEND **

Enterprise is available without charge — just visit our English or Arabic subscription page, depending on which edition you would like to receive. We give you just about everything you need to know about Egypt, in your inbox Sunday through Thursday before 7am CLT (8am for Arabic), and all we ask for is your name, email address and where you hang your hat during business hours.

SPEED ROUND

Electricity prices have just jumped, with the new tariffs having been published in the Official Gazetteyesterday following a decree by Prime Minister Ibrahim Mahlab. Electricity prices for commercial usage have been increased across the board. At home, your bill will remain unchanged if you consume less than 200 kWh (good luck in this heat…), but expect to pay an additional 2-6 piasters over your old prices for each kWh consumed on top of that. The new prices effective retroactive to 1 July 2015.

Siemens estimates that it will require a daily supply of 1.5 bcf of natural gas to fuel the power stations it is building in Egypt, a source at EGAS told Al Shorouk. EGAS is currently negotiating with Siemens on the gas supply and has been holding meetings with the company as well as the Egyptian Electricity Holding Company. Siemens is contracted to build conventional and renewable power stations in Egypt that are set to supply the equivalent of 50% of Egypt’s electricity demands.

…Meanwhile, The Electricity Ministry is about to decide on the fate of tenders for consultants on the Siemens power plants (except the ones in Al Sawoof and 6 October), after inside sources reporteddivisions within the ministry over whether to even tender for consultants to help the ministry manage Siemens. Those arguing against the tender claim local power companies have already gotten the ball rolling on operations with Siemens and Orascom, with a consultant coming in at this time being an unnecessary impediment. Those for the tender cite the advanced technology and the need for as much help as necessary with projects of this magnitude. The topic raises an interesting debate on the nature of project management on turnkey megaprojects.

The news comes amid reports that Siemens has been forced to look beyond its traditional markets to sell its turbines following Germany’s “radical” switch to renewables, as reported by Chris Bryant for the FT. “The way in which Germany’s energy transition is being handled has made it impossible for us ever to sell our fossil-fuel-related production and solutions in Germany,” Joe Kaeser, Siemens chief executive, said in May. (Read in FT, paywall)

Abraaj Group raised USD 375 mn for its second North Africa private equity fund. The closing brings USD 1.4 bn the total Abraaj has raised investment in Africa so far this year. “The North Africa fund will make investments in mid-market businesses in Algeria, Morocco and Tunisia in industries including health care, education, consumer goods and logistics,” Bloomberg reported. The closing is also getting ink in the FT, and you can read the firm’s statement on the topic here.
MOVES- Drake & Scull International PJSC announced the appointment of Sam Deeb as the group’s Chief Financial Officer (CFO) and Graeme White as the group’s Chief Commercial Officer with immediate effect. Both will report directly to CEO Khaldoun Tabari, according to a company statement.

State-run Chinese news agency Xinhua ran a report extolling the virtues of opening a Chinese economic zone in the New Suez Canal area. According to Al Ahram, the report discusses the area’s appeal to foreign firms and its suitability for projects in electronics, automobile and spare parts, energy, minerals, and glassworks among others. The report is highly encouraging of a significant Chinese presence in these fields by the Canal due to the country’s highly developed industry sector. The piece is noteworthy in light of President Abdel Fattah El-Sisi’s early-September visit to China. Egypt is one of eight nations believed to have confirmed its head of state will participate in the 3 September military parade in Beijing commemorating the end of the Second World War.

A little rap on the knuckles for Cabinet from Papa Mahlab: The Cabinet economic group held a meeting on Monday at which Prime Minister Ibrahim Mahlab stressed the need for better coordination and preparation when it comes to policy decisions and announcements. All major economic decisions are to be brought up and discussed with the economic group (they weren’t already?). The PM also reiterated in a statement his cabinet’s commitment granting preferential treatment for local providersin government tenders. The group approved a decision to extend the delivery date of last season’s cotton to textile manufacturers to the current fiscal year.

Domestic internet quality to meet international standards by end of 2016. The Ministry of Communications (MCIT) wants domestic internet quality to meet the average international standards by the end of 2016, CIT Minister Khaled Negm said at a press conference. Negm says it’s possible through MCIT initiatives including cutting the cost to ISPs of renting telecom infrastructure and by bringing more users online through retail price cuts. (It’s also possible if your benchmark for “average international standards” is the average of quality / speed readings taken in the middle of the Atlantic Ocean; Khuisiin 8 Lake in the Mongolian Highlands; and somewhere north of Iqaluit.)

Coal handling trials have begun at Ain Sokhna Al Adabiya ports, according to an advisor to the chairman of the General Authority for Red Sea Ports. While trials there are apparently yet to begin, both Abu Tartur and El Hamrawein ports are reportedly now equipped to handle coal. The Port of Safaga, which recently completed some EGP 330 mn in upgrades, is not approved to handle and store coal, reports Al Borsa.

Lower-ranking Sharqiya police officers ended their two-day sit-in on Sunday after holding negotiations with MOI officials, the state news agency reported according to Ahram Online. The protesting officers were demonstrating for better pay and other benefits. Islamist writer Fahmy Howeidy criticized claims that the protests were instigated by the Ikhwan in Al Shorouk, saying that if the claim is true, it would amount to an even greater security failure than previously acknowledged or stated. The International Business Times noted that the protests are a “rare public show of discontent toward a government that has increasingly sought to outlaw dissent”.

Pentagon chief urges Turkey to do more against Daesh: U.S. Secretary of Defense Ash Carter was recently quoted as saying that while being allowed to use Turkish airfields to attack positions in Syria was “important, but it’s not enough … [Turkey must police its border with Syria] more than it has been controlled over the last year.” (Read)

SPOTLIGHT Will a new “war on corruption” help the medicine of reform go down with the public?

After a series of recent publicized scandals, the Mahlab government is taking a hard line on corruption — and it isn’t doing it behind closed doors. A draft local administration bill is now out, proposing to grant officials at the governorate and district levels greater supervisory authority and internal oversight in investigating corruption. Sunday saw amendments to the Illicit Gains Law that call for the appointment of a state body in charge of investigating corruption cases involving illicit gains. Over the weekend, the Agriculture Minister called for a comprehensive strategy to combat “widespread corruption” across the ministries after 23 ministry officials were indicted in graft cases. What’s more, the head of the Administrative Prosecution Authority (APA) has formed a special investment cases unit within its office, tasked with handling investment-related crimes. The Prime Minister reiterated that the fight against corruption was akin to a national crusade at a visit to Mansoura on Sunday.

Why now? Despite the unveiling of an anti-corruption strategy at the end of last year, the state has made precious little progress on the issue.

The government has been repeatedly criticized for corruption in the past year, with the drumbeat becoming louder in the past few months. From the alleged ‘Sisileaks’, to the year-long investigation on Egypt’s so-called USD 9.4 bn slush funds (special accounts) published by Africa Confidential in partnership with US-based NGO Angaza, to the more recent report by the HRDO Center saying corruption cost the state EGP 3.5 bn in June 2015 alone. Bottom line: The Sisi administration has come under scrutiny for holdover practices from previous administrations.

Another motivating factor may be to combat the perception that the campaign against Egypt’s top corruption watchdog Hisham Geneina (head of the Central Auditing Organization) is actually a bid to short-circuit corruption investigations. Geneina has been accused in Egyptian media of links to Islamists including the Ikhwan and Hamas. Geneina was also heavily referenced in the Africa Confidential investigative piece. Despite being a Morsi-appointee, Geneina has received the backing of the Central Auditing Organization’s union. The recent decree authorizing the president to remove the heads of Egypt’s four independent regulatory bodies (including the CAO and the Central Bank of Egypt), was viewed as being more motivated by an ongoing dispute between justice minister Ahmed El Zend and Geneina. (There’s also a constitutional requirement that the president outline the conditions under which the heads of any one of the agencies could be dismissed.)

The Administrative Prosecution Authority (APA)’s new unit (noted above) seems more focused on resolving investment disputes lodged by investors against Egyptian administrative entities rather than going after corruption per se, despite the APA’s overarching mandate of investigating “administrative and financial crime” and referring perpetrators to criminal courts. It’s unclear how the new unit may be related to (or supplant) GAFI’s Investors Disputes Settlement Center, established in 2009. The resolution of investor disputes, especially those with Gulf Arab investors, has been a recurring theme not just in this past year, but since the immediate aftermath of the 2011 revolt. Our take is that the APA is designed more to give investors comfort than anything else.

For further reading on Egypt’s various overlapping anti-corruption bodies, see the UNODC’s brief profiles here, (pdf).

Lastly, it is possible the administration is using the language of anti-corruption to help ensure broad-based buy-in for upcoming austerity measures. The Civil Service Act, value-added tax and the ongoing liberalization of energy prices will all cause pain to multiple layers of society. The government may feel obliged to demonstrate that it is shouldering some of this burden by aggressively going after corruption in its own ranks. The language of anti-corruption is also being used to directly support such measures, with advocates of the new Civil Service Act saying it will help fight against graft.

***
A MESSAGE FROM PHAROS HOLDING

Selling Frenzy Eases as the EGX30 Falls 1.9%

The EGX30 curbed yesterday the drastic decline it witnessed in Sunday’s session. The benchmark index opened in the red, and seemed to be making a comeback an hour into the session, before sliding again to close at a 1.9% loss, continuing the streak that has been plaguing global markets, as can be seen in the performances of the Nikkei 225 and Shanghai Composite, which closed down 4.6% and 8.5%, respectively. European markets are also portraying similar trends, with the FTSE 100, CAC 40, and DAX currently down 4.0%, 4.7%, and 4.0%, respectively. Regionally, the Saudi Arabian TASI is trading 5.9% down, which can be attributed to the fall in oil prices as is seen in the Brent Crude, which is down 3.9%. Of the EGX30 constituents, Elsaeed Contracting, Madinet Nasr for Housing and Development, Egyptian Resorts, Pioneers Holding, Beltone Financial Holding, and Arab Cotton Ginning were particularly hard-hit, closing down 9.0%, 9.2%, 9.6%, 9.9%, 10.0%, and 10.0%, respectively. Credit Agricole-Egypt ended the day 5.5% up, while CIB, Juhayna, and Edita managed to inch up into the green territory. At a market turnover of EGP 444.2m, local investors were the sole net sellers of the day
***

EGYPT IN THE NEWS

‘Has Egypt become forbidden land to Hamas?’ Algeria’s most widely-circulated daily Echorouk writes on the troubled relations between Hamas and the Sisi administration in light of the recent ‘kidnapping’ of Hamas militants in Sinai. Hamas’s stance on the incidence has drawn criticism from political researcher Ibrahim Abou Saada, who says Hamas is “banging its head against the wall” if it doesn’t plan to change its strategy when it comes to cooperation with the Sisi administration given Hamas’s support of Qatar, Turkey and Ikhwan. He added that he finds reconciliation to be highly unlikely. (Read in Arabic) Despite the Echorouk piece and the recent kidnapping, head of the Hamas politburo Khaled Meshaal was quoted on Saturday in Al Araby Al-Jadeed newspaper as saying that relations between Hamas and Egypt are starting to improve, as noted by Daily News Egypt.

Ahmed Moustafa of London-based publication Al Hayat analyses the apparent conflict between Egyptian civil parties and Salafists before the upcoming parliamentary elections. A campaign by the name of “No to Religious Parties”, mainly aimed at the Salafist Al Nour Party, was launched to pressure the Supreme Constitutional Court to apply a law that bans religious parties from participation. However, a lawsuit filed by the campaigners was dismissed as “without standing” by the court and Al Nour is adamant on proving it’s “constitutionally disciplined”. (Read in Arabic)

‘Why are some Egyptians pining away for their long-gone king?’ BBC’s Mai Noman writes on Egyptians’ “selective nostalgia” when it comes to the era of King Farouk I. Ranging from recent Twitter trends,Facebook pages and websites dedicated to royalty, people’s yearning for a time long-gone comes off as idealistic and an escape from current troubles, according to blogger Nervana Mahmoud. Mahmoud claims that what people see in classical movies was “serving a niche class of society. There was also injustice and a big gap between the rich and the poor that we conveniently forget about.” (Read) Al Arabiya also noted the Twitter trend, and the UAE’s The National published a brief editorial on ‘The reason Egypt recalls Farouk.’

WORTH READING

If you think it’s OPEC or De Beers, guess again: “It is effectively a cartel, approved by the provincial government and backed by the law,” the NYT writes, describing the Federation of Quebec Maple Syrup Producers, the organization controlling 70% of the world’s supply of maple syrup. The Federation came into the spotlight in 2012, when USD 18 mn worth of the pancake topping was stolen for the global strategic reserve. This exposé also highlighted the cartel’s controversial methods in setting mandatory production quotas and punishing dissenters. You can also watch the NYT’s video report about the cartel (watching time 4:32).

WORTH WATCHING

A Turkish lieutenant colonel confronts AKP officials standing in the front row of the funeral for his slain brother, a soldier who died in a PKK attack. Despite the PKK being responsible for the death, it becomes clear by the opinions of some of the family members in attendance that they instead hold Erdogan’s AKP responsible for the recent bloodshed. The AKP officials were booed out of the 15k-strong funeral, as the grieving brother, with regard to Erdogan, says “Those who say that they want to become a martyr are hanging around in palaces with 30 bodyguards and armored vehicles. There is no such thing. If you want to become a martyr, then you should go there and do it,” he said.

One does not need to understand Turkish to be able to follow the scene as it unfolds. (Watch, running time: 2:12)

For a backgrounder on the altercation, and its lack of coverage in the Turkish media, see Hurriyet’s reporthere.

DIPLOMACY

Negotiations on Egypt joining the Eurasian Economic Union will continue during President Abdel Fattah El Sisi’s three-day visit Russia, Aly Al Leithy, Head of Egypt’s Commercial Representation Office, said in a statement on Monday. El Sisi will further discuss the establishment of the UAE-Egypt-Russia Investment Fund, financing a railway system between Helwan and ‘Ain Al Sokhna, logistics centers in 6 October and 10 Ramadan City and establishing container handling projects in the east port of Port Said,AMAY reports. Trade between Egypt and Russia was up 86% in 2014, reaching USD 5.4 bn, according to El Leithy. Egyptian exports to Russia are up 22.3% at USD 540 mn, Amwal Al Ghad reported.

India FM visits, El Sisi invited to 3rd India–Africa Forum Summit, Egypt and India sign tourism, research MoUs: Indian External Affairs Minister Sushma Swaraj held talks with President El Sisi on Monday, as well as her counterpart FM Sameh Shoukry, as well as Arab League Sec-Gen Nabil El Araby. Swaraj extended to President El Sisi an invitation to attend the third India–Africa Forum Summit (IAFS) scheduled to be held in October in New Delhi, according to the presidential spokesperson. Egypt and India also signed MoUs on tourism and scientific research, Al Mal reported.

Jordanian Deputy Prime Minister and Foreign Minister Nasser Judeh met on Monday with chief Palestinian negotiator Saeb Erekat, the Saudi Press Agency reported, to discuss the ongoing Israeli-Palestinian file.

ENERGY

Aminex converts stake in Egyptian discovery into royalty, sells stake in Aminex Petroleum Egypt
Company Press Release | 24 Aug 2015
Oil producer Aminex announced it has converted its stake in the West Esh el Mellahah-2 (WEEM-2) production sharing contract in Egypt into a royalty position. Through Aminex Petroleum Egypt, the company has drilled four wells at the concession, three of which were not found to be commercially viable. The fourth, South Malak-2, was declared commercial but if production could be established, “Aminex would have been required to meet ongoing licence costs and repay its free -carry in full prior to receiving its share of production revenues.” Therefore, Aminex agreed to sell its shareholding in its Egyptian subsidiary to fellow shareholder PetroSino together with its indirect carried interest. Aminex will no longer be represented on Aminex Petroleum Egypt’s board, which will change its name to a new one unrelated to the Aminex brand. PetroSino will pay Aminex a nominal sum for its share in the Egyptian subsidiary as well as a 1% gross overriding royalty on the full sales value of its share of production from SM-2 following cost recovery. (Read)

Environmental Affairs Ministry assessing 19 cement plants’ coal request to install coal tech
Al Borsa | 24 Aug 2015
The Environmental Affairs Ministry is assessing requests from 19 cement producers to install coal pulverising facilities in their plants. The Ministry has already tasked a committee with assessing the environmental impact of the in house pulverising facilities. Environmental Affairs Minister Khaled Fahmy stressed that the ministry will enforce all coal-related regulations strictly. (Read in Arabic)

Arab Organization for Industrialization to build nine solar power plants
Al Borsa | 23 Aug 2015
The Arab Organization for Industrialization (AOI) will build nine solar power plants in the North Delta after it won a tender against 25 companies, including Arab International Optronics and Onera Systems, an AOI source told Al Borsa. The power plants will have a capacity of 91 KW and will cost EGP 940 mn. This project comes as part of the government’s plan to light around 1k buildings through solar energy. (Read in Arabic)

BASIC MATERIALS + COMMODITIES

Egypt creates USD 125 mn national oil sands company, seeks extraction equipment
Al Borsa | 24 Aug 2015
Egypt is forming a national oil sands company in cooperation with the military, the Egyptian Atomic Energy Authority, the Egyptian Mineral Resources Authority, as well as the National Investment Bank and the governorate of Kafr El Sheikh. The company will have a capital of USD 125 mn and hopes to extract minerals including zircon, titanium, and magnetite. The government is also engaged in talks with four international companies over providing extraction equipment and is seeking their delivery by next December. Al Borsa reports that Egypt has 300 mn tonnes of oil sands deposits that could bring in USD 324 mn annually. (Read in Arabic)

MANUFACTURING

** Further reading in Manufacturing: Oren Kessler of the neoconservative thinktank / lobbying firm Foundation for Defense of Democracies writes in Foreign Affairs on the history and modest success of the QIZ program in ‘Trading Peace in Egypt and Israel – How QIZs Could Save the Middle East,’’ (paywall).

HEALTH + EDUCATION

Ghana seeks Egyptian doctors in response to workers’ strike
Al Masry Al Youm | 24 Aug 2015
Ghana has officially asked Egypt’s Foreign Affairs Ministry to send Egyptian doctors to the West African country, Al Masry Al Youm reported. The Foreign Affairs Ministry’s Agency for Development Partnership agreed and expressed its willingness to finance the secondment of 30 Egyptian doctors to Ghana. However, the Egyptian Medical Syndicate refused the decision and expressed its solidarity with the striking Ghanaian doctors. (Read in Arabic)

REAL ESTATE + HOUSING

Dar Misr house prices in Sheikh Zayed will be 50% lower than market
Al Mal | 24 Aug 2015
Dar Misr house prices in Sheikh Zayed will be 50% cheaper than the market rates, Gamal Talaat, the head of the Sheikh Zayed City Authority said. The units will be built over two phases, Talaat added, with the first phase including 900 houses and the second including 600. The Engineering Authority of the Armed Forces will be responsible for the construction of the two phases and the first phase is expected to be completed in a year and a half. (Read in Arabic)

SODIC bidding for Sheikh Zayed plot against Badreldine for Real Estate
Al Mal | 24 Aug 2015
SODIC and Badreldine for Real Estate are bidding for the same 410-feddan land plot in Sheikh Zayed, Al Mal reported. Both companies presented bids to cooperate with NUCA in developing the land and constructing real estate projects on it. The land, commonly known as the Prince Mishaal Land, was withdrawn from a Saudi developer in 2010. The head of the Sheikh Zayed City Authority said all issues concerning height restrictions place on any developments in the land plot were also resolved. (Read in Arabic)

Housing Ministry allocates land plots for Bayt Al Watan’s second phase
Al Mal | 24 Aug 2015
The Ministry of Housing is currently surveying completed projects in Rehab and Madinaty to issue for Egyptian abroad as part of the second phase of the Bayt Al Watan. Housing Minister Moustafa Madbouly announced that the second phase includes 2,100 land plots, bringing the total allocated land in the second phase of Bayt Al Watan to 4,600 plots. The Housing Ministry expects payment for the land plots to be in dollars. (Read in Arabic)

TOURISM

60 tourism projects stalled in South Sinai – Investors’ association
Al Borsa | 23 Aug 2015
South Sinai has seen the closure of 60 tourism projects, in Taba, Nuweiba and Dahab in particular, as a result of governmental negligence, said Sami Sulaiman, head of the Taba-Nuweiba Investors Association. He added that these projects, which include Taba International Airport and 11 hotels, would face permanent closure if the government doesn’t step in. (Read in Arabic)

USD 6.8 bn in expected returns from tourism promotion campaign over 3 years, says Minister of Tourism
Al Borsa | 24 Aug 2015
Minister of Tourism Khaled Ramy expects USD 6.8 bn in returns from the international tourism opportunities promotion campaign over the coming 3 years. JWT was awarded a USD 68 mn contract to promote Egyptian tourism opportunities in 27 global markets over the next three years, starting in October. (Read in Arabic)

AUTOMOTIVE + TRANSPORTATION

Damietta International Ports Company seek international arbitration
Al Mal | 24 Aug 2015
The Damietta International Ports Company (DIPCO) is seeking international arbitration against the Ministry of Transportation, represented by the Damietta Port Authority. The move follows a breach of contract to build and manage a new container terminal originally inked in 2006, sources within DIPCO told Al Mal. The company is demanding USD 1 bn in compensation from the government for USD 400 mn in investments, and USD 600 mn in damages due to subsequent delays and fees incurred. (Read in Arabic)

BANKING + FINANCE

EFSA exempts ABK from submitting a tender offer for remaining Piraeus shares
Al Borsa | 23 Aug 2015
EFSA exempted Al Ahli Bank (ABK) of Kuwait from submitting a mandatory tender offer for the remaining shares of Piraeus Bank’s Egyptian operations. ABK had already acquired 98.5% of the bank’s shares. EFSA exempted ABK from submitting the mandatory offer in accordance with article 356 of law 95 / 1992, which gives the Authority the power to exempt buyers under certain conditions. (Read in Arabic)

Bahrain’s ABC to arrange USD 300 mn loan for Banque Misr-sources
Amwal Al Ghad | 24 Aug 2015
Banque Misr has asked Bahrain’s Bank ABC to arrange for it a USD 300 mn loan, sources told Amwal Al Ghad. The funds are going to be used to improve the bank’s foreign currency liquidity and will be repaid over three years. NBE had already secured a similar facility and borrowed USD 300 mn from international institutions. (Read in Arabic)

Public Funds Investigation requests banks to perform daily inspection of ATM machines
Al Borsa | 24 Aug 2015
The General Directorate for Public Funds Investigation requested that the Central Bank require banks to inspect ATM machines daily due to a rise in reported identity theft. Ahmed Abo ElDahab, director of retail banking at the Society Arab International Bank (SAIB), said that the bank recently discovered a group that steals clients’ personal information by placing specialized cameras on ATM machines. To combat this, the Central Bank reached an agreement with NCR, a company that specializes technology solutions, to upgrade ATM machines and prevent identity theft. (Read in Arabic)

OTHER BUSINESS NEWS OF NOTE

GMC Group to begin operations at EGP 180 mn Al Haram Commercial Mall within 10 days
Amwal Al Ghad | 24 Aug 2015
The GMC Group for Industrial, Commercial and Financial Investments, will begin operations of its EGP 180 mn commercial mall within the coming 10 days. Construction over an area of 800k sqm has been completed, according to GMC president Mohamed Geneidy, noting that his company is negotiating leases for major companies including Carrefour and Mobinil in the coming days. (Read in Arabic)

LEGISLATION + POLICY

Government changes name of agency overseeing Suez Canal economic zone
Al Borsa | 24 Aug 2015
The government issued a decree renaming the General Authority for the Economic Zone of the Suez Canal to the “General Authority for the Economic Zone of the North West Gulf of Suez.” The Authority was also granted control over all the land and ports of its predecessor. The decree also required the head of the new Authority to be an Egyptian retaining their legal rights and not having been convicted of a crime. (Read in Arabic)

NATIONAL SECURITY

Bomb kills 3 Egyptian police officers, wounds 33 -officials: A bus transporting Egyptian police in the Nile Delta Baheira governorate was struck by a bomb on Monday, killing three police and wounding 33 others, according to the AFP quoting security officials. The officers were travelling by civilian bus to their work. (Read)

Israeli Defense official denies US to withdraw Sinai force: The denial was made by Amos Gilad, head of the IDF’s political-security branch in an interview on Israeli Army Radio, the Jerusalem Post reports. “The US is committed to this peace agreement by law and also in a deep way … Everybody agrees with its importance,” he said. (Read)

REGIONAL

Airline dogfights of the Middle East: American Airlines, the world’s largest airlines by passenger count and revenues, announced last week that it will end its flights to Israel, citing financial difficulties. Industry pundits, however, point to the airline’s desire to strengthen its ties with Arab airlines that are part of its Oneworld alliance, Haaretz reports. The move proved controversial with doubters citing both AA’s financial position and the sudden nature of the announcement, with staff at Ben Gurion reporting that they heard of the decision in the news. If the Oneworld alliance theory proves valid, the move could signal the growing importance of the region in dwarfing Israel’s potential.

ON YOUR WAY OUT

Cairo University has suspended 150 employees for drug use, with another 40 under investigation, President Gaber Nassar said. Cairo University employees are subjected to periodic blood tests. Nassar said that Cairo University is fully prepared to treat its employees at its own expense and accept the appeals process. (Read in Arabic)

Zamalek White Knights to be detained in Cairo Airport, Mortada Mansour says: Zamalek SC Ultras White Knights (UWK) fans coming from Tunisia will be detained by the MOI upon arrival at Cairo Airport for murder charges, according to lawyer and Zamalek Club President Mortada Mansour to Al Hayah Television on Monday. Youm 7 reported that no UWK fans were on the Zamalek plane that landed in Cairo Airport Sunday night, however. The often controversial Mansour said that UWK fans’ chants insulted President El Sisi and the military in the game between Zamalek and CS Sfaxien in Tunisia on Sunday. UWK directed insults and posted provocative banners targeting Mansour and players. It is believed that UWK fans’ anger stems from Mansour and the players’ reaction to the 22 Zamalek fans killed outside the Air Force Stadium in Cairo last February. UWK referred to the February tragedy as a “deliberate massacre”. (Read in Arabic)

BY THE NUMBERS

USD CBE auction (Sunday, 23 August): 7.7301 (unchanged since Sunday, 05 July)
USD parallel market (Sunday, 23 August): 7.95 (+0.02 from Thursday, 20 August, Reuters)

EGX30 (Monday): 6,654.06 (-1.92%)
Turnover: EGP 444.2 mn (5% below the 90-day average)

WTI: USD 38.23 (-0.03%)
Brent: USD 42.69 (-6.09%)

TASI: 7,024.6 (-5.9%)
ADX: 4,264.8 (-0.5%)
DFM: 3,401.6 (-1.4%)
KSE Weighted Index: 388.9 (-1.3%)
QE: 10,572.5 (-1.7%)
MSM: 5,736.0 (-3.0%)