Fahmy (right) and colleagues get three years, setting off international media firestorm
- Al Jazeera English journalists handed three-year sentences
- EgyptAir chairman sacked
- Lots of back-and-forth at the cabinet table over the VAT
- Canada’s export-credit agency will partially finance Six October monorail
- IMF to begin consultations in September
- El Sisi begins seven-day Asian tour
- Cabinet doing a sales job on the Civil Service Act
WHAT WE’RE TRACKING TODAY
The Supreme Election Committee “will announce the measures of the 2015 parliamentary elections in a press conference on Sunday,” according to the committee’s spokesperson Omar Marawan.
President El Sisi begins a seven-day Asian tour today, starting the first leg of his trip in Singapore, with the visit running until Tuesday. The President’s arrival in Singapore will mark the first state visit of its kind to the country since diplomatic relations began in 1966, the Straits Times notes. The President will be accompanied by a delegation including the ministers of foreign affairs, water resources and irrigation, and investment. The President then arrives in Beijing on 3 September for China’s commemoration of the end of the Second World War. 81 of Egypt’s honor guard are set to attend the commemoration according to China’s chargé d’affaires in Cairo. President El Sisi’s tour will end in Indonesia, after which he and the delegation will return to Cairo on 5 September.
The roller-coaster ride isn’t over yet: U.S. and European markets closed up fractionally on Friday, bringing a roller-coaster of a week to an end. Chinese markets also closed up, with some speculating that the central government had stepped in to prop up shares. As we’ve been saying here at Enterprise for a while now, the Chinese edifice is the biggest unknown (and threat) in the global economy, something mainstream Western analysts are waking up to now. Quoth the WSJ: “‘There’s probably more of a fragility to both the market and the global economy than we thought’ earlier, said John Linehan, portfolio manager of U.S. large-cap value strategies at T. Rowe Price. ‘China is a huge unknown right now.’” Added another trader: “I find it a little too neat that we had our couple of bad days and it’s back to business as usual … and the VIX is telling you that.”
Egyptian startup lands European capital and U.S. media attention. BasharSoft, the Egyptian startup that runs the Wuzzuf recruitment portal, has landed investment from significant European VCs. Details in “Worth Reading,” below. (h/t Ramez M.)
WHAT WE’RE TRACKING THIS WEEK
The Future of Energy in Egypt envisions Egypt becoming one of the Middle East’s top five energy exporters by 2030. The summit takes place 31 August – 1 September in Cairo.
The Emirates NBD / Markit Economics Purchasing Managers’ Index for Egypt (as well as those for the UAE and Saudi) will drop on 3 September at around 7:30am CLT.
LAST NIGHT’S TALK SHOWS
On Saturday night, Lamis El Hadidy returned to her flagship program Hona El Assema with a bang. The bespectacled hostess effectively stole the spotlight, landing an exclusive interview with celebrity human rights lawyer, Amal Clooney, international counsel for (depending on your point of view) the Al Jazeera Three or the “Marriott Cell.” Veteran journalists Mohamed Fahmy (until recently a dual Canadian-Egyptian national who has since renounced his Egyptian citizenship) and Peter Greste (Australian since deported) as well as their Egyptian producer Baher Mohamed were sentenced to three year jail terms for operating without a license and broadcasting reports harmful to Egypt’s image.
El Hadidy’s interview with Clooney is available on YouTube. (English with Arabic subtitles. Watch: runtime 12:15)
El Hadidy prefaced her prerecorded interview — which took place after the verdict was handed down — with a statement that aimed to ensure she remained on the right side of the nation’s judiciary, which views as illegal most forms of commentary on decisions handed down from the bench. Speaking on behalf of the Egyptian people, El Hadidy stated, “We all respect judicial judgments. The Marriott Cell Case is not, as many allege, politicized. … The Ikhwan have tried to exploit the matter to their benefit.”
The 12-minute interview focused squarely on the case, with Clooney’s personal life mercifully off-limits. The lawyer began the interview by voicing her dissatisfaction over the outcome of the trial, stating that it had all “the hallmarks of a show-trial.” Clooney proceeded to describe the prosecution’s arguments as “flimsy” and “absurd,” saying its use of outdated video of pop-stars as evidence was “completely irrelevant”. Nonetheless, the lawyer conceded that the “one positive thing was that the judge did not sustain the conviction of the terrorism charges.”
Clooney later revealed that she would continue her fight for the release of the journalists by urging President El-Sisi to issue a presidential pardon on their behalf. Additionally, the lawyer intends to file a joint-petition with Canada’s ambassador to Egypt requesting the immediate deportation of Fahmy.
Asked by El Hadidy why she agreed to take on the case, Clooney answered with a concise, yet powerful response: “Its frightening to see a journalist go to prison for simply reporting the news. I knew that there was a lot at stake in this case. Freedom of speech and the integrity of the judicial process [were at stake] … Egypt, in many ways, is the center of the Arab and Muslim world; its judiciary is looked to by other judiciaries in the region. This is an important case and its repercussions will be felt all around the region.”
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Al Jazeera English journalists Mohamed Fahmy, Baher Mohamed and Peter Greste were sentenced to three years in prison during the final session of their retrial on Saturday on charges of failing to register with the Journalist’s Syndicate and for broadcasting from a hotel without obtaining permission. Greste was sentenced in absentia, having been deported in February; Baher Mohamed received an additional six months for possessing a spent cartridge case, as reported by Al Jazeera, the BBC, and others. An appeal against the verdict is planned, according to Al Jazeera, which also reports that the time already spent in prison by the journalists will count toward time served. The verdict was met with widespread condemnation, some of which is highlighted in our Egypt in the News section below. Fahmy, for his part, filed a USD 100 mn lawsuit against Al Jazeera in May.
EgyptAir chairman sacked amid allegations of “mismanagement.” Civil Aviation Minister Hossam Kamal has sacked Sameh El-Hefny, tapping Sherif Fathy to serve as EgyptAir’s interim Chairman until the national flag carrier’s general assembly appoints a full time replacement for. There are reports that El Hefny was sacked due to “operational inconsistencies” reported by the Administrative Control Authority to President Abdel Fattah El Sisi. The allegations, if true, do not on the surface appear to rise to the level of criminal misconduct, appearing instead to center around lax management, a report by Ahram Online suggests. El-Hefny, meanwhile, was out doing damage control, telling Al-Borsa that “EgyptAir Holding Co.’s losses declined by 82%, falling from EGP 2.8 bn in FY 2013/14 to to EGP 570 mn in 2014/2015, during my second year at the helm of the company.” said former chairman and CEO Sameh Hefny to Al Borsa. Hefny also rubbished claims that the Aviation Ministry intends to limit EgyptAir’s activities to the MENA region, ceasing its activities outside of the Middle East.
An International Monetary Fund (IMF) mission, headed by Egypt mission chief Chris Jarvis, will hold high-level talks with senior Egyptian officials in September, Al Borsa reports. The IMF team will meet with Prime Minister Ibrahim Mahlab, members of the Cabinet economic group, and Central Bank Governor Hisham Ramez. Reportedly on the agenda: the value-added tax (VAT), final accounts for the 2013-2014 fiscal year, and the budget for the current fiscal year. Ramez and the CBE team will also be discussing monetary policy, the paper says. The routine talks had previously been expected in June and are not, contrary to what was reported at the time, Article IV consultations. The report on the last round of Article IV discussions was out this past February (pdf download).
Speaking of the VAT, there’s rather a lot to iron out: Cabinet’s economic group is holding daily meetings to come to a final form on the value-added tax, according to the domestic press. Ministers are reportedly divided on whether to enact a stand-alone VAT act or amend the existing sales tax law. The Finance Ministry and the Tax Authority apparently prefer to amend existing legislation, believing a new law would be “redundant,” Al Borsa reports. A hottopic of debate is whether to allow companies a grace period in which to comply with the act, with there being the usual speculation that ‘traders’ will try to find a way to skew the new law to their temporary advantage and, inevitably, jack-up prices. The economic team is also yet to agree on which goods and services would be subject to taxation at a rate higher than the 10-15% envisioned for the VAT, while the fate of private hospitals and schools is also yet to be decided.
Canada’s export credit agency will reportedly provide partial financing for the USD 1.5 bn Six October monorail, Al-Borsa reports. Bombardier Inc., which is building a 52-kilometer, 17-station rail link connecting the Cairo Metro system to Six October and Sheikh Zayed, has reportedly agreed with Export Development Canada on a contribution to the project financing package. Bombardier is part of a consortium including Orascom Construction and Arab Contractors for the project. Al-Borsa claims Bombardier is in talks with international financial institutions to finance the “USD 800 mn foreign share” of project finance package and says the EDC declined to specify its commitment to the package pending finalization of documentation. Reuters’ coverage of the early May monorail announcement is here. Bombardier tapped EDC for USD 500 mn in financing for a monorail in India in the summer of 2014, according to Indian media reports.
The Turks want to elbow Egypt out of natural gas import agreements: “Turkey will pay more for Israeli gas, and be a more reliable source of demand [than Egypt],” Nusret Comert, a Turkish energy expert and chairman of the first private gas company to import gas into Turkey, said in an interview with Globes. He says that Egypt is not the best option for Israeli gas exports, claiming that lower energy prices do not make natural gas liquefaction in Egypt and re-exporting to Asia worthwhile. Europe is a better option, Comert says, and he believes this market could be reached via Turkey.
Reuters’ Shadi Bushra is reminding readers again that Egyptian industrial output will continue to suffer unless the government starts diverting more gas to generation for industry rather than household consumption. “Far fewer Egyptians are complaining about the kind of power cuts that fuelled unrest in the past, but government energy policies apparently focused on appeasing the public are dealing a blow to industries vital for economic growth,” Bushra says, noting that manufacturing output is estimated to have contracted by 30% y-o-y in June, according to Capital Economics.
We weren’t the only ones who goofed: The domestic press also jumped on the nuclear plant bandwagon, prompting Ittihadiya to release a statement this weekend, noting that it had never announced an agreement to build a nuclear power plant would be signed during President Abdel Fattah El Sisi’s trip to Moscow,Ittihadiya’s spokesperson Alaa Youssef said. Technical and Financial negotiations are still underway and Egypt is also assessing a offers from a number of countries to build the power plant, Youssef added. What was on the agenda in Moscow? Cooperation in fields including industry and energy. President El Sisi had met with Rosneft President Igor Sechin on the last day of his visit to Moscow; the two discussed increasing cooperation and expanding Rosneft’s activities in Egypt. On Thursday, Rosneft made two announcements: Rosneft Trading SA, a subsidiary, signed a master LNG supply and purchase agreement with EGAS (company statement). Rosneft also signed a declaration “with a view to organize the education of Egyptian citizens in the partner universities of the company.” A joint working group will be set up to formalize the agreement’s specifics.
Cabinet re-thinking Egypt’s trade policy: The Trade and Industry Ministry is “evaluating” Egypt’s interlocking network of trade agreements suggesting some re-thinking of trade policy may be in order as emerging market growth cools. Minister Mounir Fakhry Abdelnour stated that Egypt must carefully evaluate its position in light of slower growth of the BRIC nations and non-WTO pacts including the Transatlantic Trade Investment Partnership (i.e.: the EU cozying-up with Amreeka) and the Trans-Pacific Partnership(about a dozen Pacific Rim countries, including the majors: the U.S., Canada, New Zealand, Japan and Australia). Abdelnour added that he has formed a commission with representatives from the ministries of Foreign Affairs, Industry, Investment, Electricity, Agriculture, and International Cooperation to study the impact of this changing global scene on Egypt. Egypt had been leading the setup of a tripartite free-trade agreement encompassing COMESA, SADC and the EAC, hosting a major summit on the topic in May.
Rice exports are banned starting from 1 September, the Trade and Industry Ministry has decreed. “Egypt is expected to produce 2.7 mn tonnes of white rice in the 2015-2016 season while its annual consumption is estimated at 3.6 mn tonnes. The 750k-tonne gap will be filled by stocks, the ministry said in a statement,” according to Reuters. Trade and Ministry Mounir Abdelnour said the decision came in response to demands from the domestic market. Naturally enough, the decision prompted widespread industry panic. The Federation of Egyptian Industries has issued a press release urging the government to allow rice exports to continue, stating that they should allow 1 mn tonnes to be exported out of a supply of 4 mn tonnes; the federation pegs domestic consumption at no more than 3 mn tonnes. FEI head Mohamed El Sewedy says that the opening rice exports would be beneficial to the farmer, while Ahmed El Wakeel, a major rice exporter,added that the banning exports will disrupt EGP 2 bn in investments and (in a slightly threatening tone) lead to a spike in sector unemployment.
Cold water on ruble-based trade with Russia: Egypt’s tourism sector cannot withstand the “harmful effects” of fluctuations in the value of the ruble if the government approves its use for trade in the sector, saidElhamy El Zayat head of the Egyptian Tourism Federation. The statement comes after President Abdel Fattah El-Sisi announced on his state trip to Russia that the government is considering accepting rubles from tour operators. The domestic press warns that “industry experts” say that a collapse of the currency would have adverse effects sector-wide. The Mahlab government has previously suggested it would be willing to permit Russian tour operators to settle their dues in Egypt in ruble, with Russia in turn accepting the same currency as settlement for wheat imports. Al-Masry Al-Youm had a backgrounder in Friday’s edition on the issue, presenting it as a hedge against devaluation of the EGP against the USD and as promoting trade between Russia and Egypt.
A German trade delegation will arrive in Cairo for a two-day mission starting 13 September2015, according to Rainer Herret, CEO of the German-Arab Chamber of Industry and Commerce. Among the opportunities they will study, Al Mal, is a USD 100-150 mn investment in the Suez Canal Axis’ ‘E-City’ project.
Selling the Civil Service Act: The government issued a report outlining who exactly will be subject to the Civil Service Law: Exempt are government bodies that have special executive regulations, such as the Suez Canal Authority. The law will also not apply to professions regulated by their own acts of parliament, including judges and lawyers, diplomats, doctors, and university professors. The Supply Minister also came out in a press conference in defense of the act, stating that civil service rankings have been restructured in a way to streamline promotions and benefits. He is taking a more diplomatic approach than others (cough, cough … Dimian), proposing that all unions opposing the law meet with him this week to discuss changes to its executive regulations. Union leaders agreed to the sit-down, but continued to call for the law to be scrapped.
What does it mean? One of the main factors in the backlash was the simple fact that civil servants felt the law had been dropped on them with no warning or explanation. An aversion to change also plays a role. In the wake of a protest by Tax Authority staff, the Mahlab government has taken a more educational and media-savvy tone, highlighting the limited scope of the law and its benefits in the form of faster promotions and merit-based appointments. Former Deputy Prime Minister Ziad Bahaa El Din’s op-ed from earlier this month on the subject does an excellent job explaining the law, blaming the backlash on the manner in which it was implemented. He points to the special executive regulations exemptions as a flaw in implementation as it indicates a haphazard approach to applying the law, since these exempt bodies are numerous. A petition by Tax Authority employees to turn the Tax Authority into an independent body might be a move to play into that loophole.
Drinking water stations in Assiut have now been brought back to full production after maintenance and testing of water quality in the wake of a heavy fuel oil spill from a nearby power plant. The Holding Co. for Water and Wastewater received approvals to begin operations from the ministries of health and environment. A spokesman for the company stated that the move was a preventative measure to ensure against pollution seeping into the system, adding that the governorate was supplied with clean drinking water from artesian wells for the duration of the maintenance. The move comes on the back of a major diesel spillage from a steam power plant contaminated 13 water stations in Assiut and Minyaon Friday. See ‘Infrastructure,’ below, for more on the plant, which has since been closed.
Government inaction stalls World Bank healthcare program for rural Egypt: According to a status report (pdf) from the World Bank, a USD 75 mn project to improve access to primary health care in Egypt’s poorest 1,000 villages is stalled on account of the Egyptian government failing to ratify an agreement changing the project’s focus to assisting the villages. The amended agreement was approved by the World Bank at the end of May. As a result, the project funds are yet to be disbursed and the project has yet to begin. The funding was originally intended to improve financial sustainability of social health care operations.
Ah, the power of monopoly: TE-Data’s market share will shoot past the 72% mark as the company reports 2.8 mn subscribers at the end of this month, according to a report in the domestic press. The company added 300k users after slashing ADSL prices. TE’s new pricing scheme seems to confirm detractors’ worst allegations that the company’s stranglehold on broadband infrastructure allows TE-Data to hold a monopoly. While TE was ostensibly in talks to lower infrastructure rates for internet providers, the results seem to vindicate their accusations.
An Egyptian businessman uses SPVs? The perfidy. Al Masry Al Youm can barely restrain itself as it reports that Juhayna chief Safwan Thabet and his family hold stakes in the dairy and juice giant through two BVI’s. Stunning, we know. Thabet’s assets in Egypt have been frozen by the government commission appointed to investigate and manage assets linked to the banned Muslim Brotherhood.
Q&A on the key economic impact of Iran agreement: The World Bank’s Chief Economist for the Middle East and North Africa, Shanta Devarajan, published earlier this month an examination of the economic impact of the lifting of sanctions on Iran. Notably: “The addition of a mn barrels a day of Iranian oil will, assuming no strategic response by other oil producers, have the effect of lowering the world oil price by 14%, or USD 10 a barrel. In turn, this will … [benefit] the region’s oil importers, such as Egypt and Tunisia.” (Read)
A MESSAGE FROM PHAROS HOLDING
Why do we like GEMMA? We think there’s >130% upside potential — even after we cut our FV estimate to reflect headwinds in its export markets
Weaker sales volumes to export markets aren’t the real story at ceramics and porcelain producer GEMMA: We expect deliveries of properties sold over the past three years to support the company’s revenues starting 2016 onwards, as we expect domestic sales to partially offset the slack in export markets and push total volumes sold towards the 11.5m sqm in 2016 and above the 12.0m sqm mark starting 2017 onwards, versus an estimated 11.1m sqm in 2015. Indeed, we expect softer export volumes until 2016 due to sluggish economic conditions as well as political turmoil in key export markets.
True, we’re revising our volume and margin assumptions significantly downwards to account for the headwinds faced by the firm in its key export markets. We now expect the firm to operate way below capacity (15.0m sqm/annum) until the end of our forecast horizon and only touch the 13.0m sqm level by 2019, a level that was comfortably crossed in 2012 and 2013. On these assumptions, we downgrade our FV estimate from EGP 13.6/share to EGP 9.7/share — but maintain our BUY recommendation given the presence of a 130.4% upside potential versus the closing price of 23 August 2015. Click here to learn more about why we think GEMMA is worth a look.
EGYPT IN THE NEWS
The Al Jazeera retrial verdict naturally dominated headlines on Egypt in the foreign press, with the AP’s liveblog providing the most comprehensive coverage of the day, including reactions from foreign officials.Canadian Minister of State for Consular Affairs Lynne Yelich issued a statement Saturday after the verdict, saying the court’s decision “severely undermines confidence in the rule of law in Egypt … The government of Canada continues to call on the Egyptian government to use all tools at its disposal to resolve Mr. Fahmy’s case and allow his immediate return to Canada.” Peter Greste’s lawyer released a statement calling upon President Abdel Fattah El Sisi to issue a pardon, saying the President “now has an opportunity to correct this great injustice.” The Committee to Protect Journalists also issued a statement condemning the verdict.
Reactions on social media:
- Managing Editor of American news network ABC Jon Williams: Sisi in NYC for #UNGA 4 weeks time. US used to protest #Iran speech with walkout. Media should do same to #Egypt #TimeToStandUp #FreeAJStaff
- United States Ambassador to the United Nations Samantha Power: Al Jazeera journos Fahmy, Greste, & Mohamed sentenced to 3yrs in #Egypt just for doing their jobs. Another significant blow to press freedom
- Peter Greste: “Our convictions are unfair and unjust. We will use every tool – legal, diplomatic, political and social – to #FreeAJStaff. Join us RT”
Mohamed Soltan describes life inside Egyptian prison: David Kirkpatrick interviews former dual national Mohamed Soltan, (he renounced his Egyptian citizenship in order to facilitate his deportation to the United States) son of prominent Ikhwani Salah Soltan. Mohamed Soltan was until recently held in Egyptian prison, having been arrested days after the Rabaa forced dispersal. In prison, Soltan committed to a hunger strike for 16 of his 21 months in jail, according to the NYT. Soltan claims in his interview that prison officials placed a terminally ill man in his cell who died a prolonged and painful death despite Soltan’s call for guards, and whose corpse Soltan was left with in his cell until well into the next day. (Read)
…More on Egypt’s prisons: Tom Stevenson published a c.3.6k-word essay on conditions inside Egypt’s prisons in the London Review of Books titled ‘Sisi’s Way‘: “It’s no secret that Hosni Mubarak’s regime was repressive. Yet although in its treatment of prisoners and many other ways besides, Abdel Fattah el-Sisi’s is worse … Diana Eltahawy, a former member of the Egyptian Initiative for Personal Rights, observes that Egypt’s prisons ‘are very much a microcosm of the wider society’. Poorer detainees suffer some of the worst abuse and often work for richer prisoners in order to buy access to slight improvements, just as they might if they were at liberty.” (Read)
Egypt pivoting to Russia, China: Both Chinese state news agency Xinhua and the Saudi Gazette write on Egypt’s diversification of its strategic relationships, pointing to the heightened engagement with Russia and China as examples. The Saudi Gazette’s piece, while touching upon Syria as being a main part of the talks in Moscow, fails to make mention of Putin’s claim during his joint press conference with President El Sisi that Egypt supports building an anti-Daesh coalition with Bashar Al Assad as one of its partners. Emailed statements from Ittihadiya also failed to make mention of working with Assad.
WHAT YOU CLICKED ON LAST WEEK
The most-clicked links in Enterprise last week were:
- A Brutal Week in Markets, But What Comes Next? (Mohamed El-Erian for Bloomberg View)
- The EGP looks set to fall to 8.00 to the USD in the coming weeks and to 8.50 in 2016 (Pharos Holding)
- Who’s Next in the Currency Market’s Race to the Bottom? (Bloomberg)
- Investment Banking: Titans retreat (FT)
- Economic Risk of Stock Plunge Varies Around Globe: Threat is greatest to emerging-market economies, where the China effect looms largest (WSJ)
TechCrunch, the inveterate chroniclers of StartupLand, have taken note of Egypt’s BasharSoft— not a household name to many in the business community, although a good number of your HR departments have likely used Wuzzuf, its popular recruitment site. Says TechCrunch: “BasharSoft, the startup behind leading Egyptian recruiting [site] Wuzzuf, has spent the last 5 years surviving the turmoil of Egypt’s recent history. But it’s come through that to become a rare-commodity: An Egyptian company that has raised significant European VC cash. It’s just closed a Series A of USD1.7 mn from Sweden-based Vostok New Ventures and UK-based Piton Capital, in addition to previous investment from 500 Startups and Endure Capital. It’s probably fair to say that raising USD 1.7 mn in Egypt is closer to raising a USD 7 mn+ round in the US, to put that in context. Vostok are investors in Delivery Hero, while Piton are investors in FanDuel, both ‘unicorns’. … Previous investors in BasharSoft included Egypt-based angel investors Con O’Donnell and Tarek Fahim – in addition to Amr Awadallah, CTO and Co-founder of Cloudera.”Read: Wuzzuf Secures Egypt’s Largest Funding Round, Led By European VCs
Mahlab inaugurates radioisotope generator at Inshas
Ahram Gate | 29 Aug 2015
Prime Minister Ibrahim Mahlab inaugurated a radioisotope generator at the experimental nuclear reactor in Inshas, Sharkiya. INVAP, an Argentinian company, built the generator at a cost of USD 21.37 mn. The radioisotope generator comes as part of the plan to expand the reactor’s usage for civilian purposes, Atef Abd El Hamid, the head of Egyptian Atomic Energy Agency said. Abdel Hamid added that the radioisotopes produced at the generator will play an important role in nuclear medicine domestically. (Read in Arabic)
EETC signs EGP 31.5 mn transformer agreement with EGEMAC
Al Mal | 26 Aug 2015
The Egyptian Electricity Transfer Company (EETC) signed an EGP 31.5 mn agreement with EGEMAC, Al Mal reported. EGEMAC will be tasked with constructing the Manfalout transformer station. Sources told Al Mal that EETC will source the funds internally without having to resort to borrowing. (Read in Arabic)
BASIC MATERIALS + COMMODITIES
Egypt appeases French traders, extends high-moisture wheat exemption
Reuters | 27 Aug 2015
Egypt will accept higher moisture levels in government tenders to buy wheat for one year after the initial exemption expires by August’s end, Supplies Minister Khaled Hanafy said. “The decision was taken to ensure Egypt had a variety of origins from which to import wheat,” Hanafy added. “The request for the exemption to be extended was made by the French side,” the director of export lobby France Export Cereales told Reuters. Before the exemption, French wheat producers were struggling to meet the stringent moisture limits imposed by GASC before the exemption was imposed. (Read)
Supplies Ministry inks agreement with Italy for ten horizontal silos
Amwal Al Ghad | 27 Aug 2015
The Supplies Ministry is inking an agreement with the Italian government to build ten horizontal grain storage silos. The agreement is worth USD 17 mn and set to be finalized within days, Supplies Minister Khaled Hanafy said. The project will be completed over two years and is a first step of a USD 45 mn debt exchange program between the governments of Egypt and Italy. (Read in Arabic)
HEALTH + EDUCATION
Gov’t set to establish learning centers to fight spread of private tutoring
Al Masry Al Youm | 26 Aug 2015
Prime Minister Ibrahim Mahlab has pledged to establish learning centers throughout the country in a bid to bring to an end Egyptian families’ reliance on private tutoring for the instruction of their children. The learning centers will likely be located at schools and youth centers across the republic and will teach a variety of subjects once established, added Mahlab. (Read in Arabic)
REAL ESTATE + HOUSING
Alternative housing for Dokki informal settlement residents dispersed by security forces to cost EGP 6 mn
Al Mal | 29 Aug 2015
The Ministry of Urban Renewal and Informal Settlements and the Giza governorate will provide Dokki residents displaced by security forces last week with alternative housing at a cost of nearly EGP 6 mn. Minister of Urban Renewal Laila Iskandar said that the dispersal last week stems from municipalities’ inexperience with forced evictions without providing housing alternatives to residents. (Read in Arabic)
Seven urban renovation projects of “unsafe areas” worth EGP 209 mn completed, Minister of Urban Renewal says
Al Mal | 29 Aug 2015
Urban Renewal Minister Laila Iskandar announced on Thursday the completion of seven urban renovation projects in designated “unsafe areas” in seven different governorates that cost EGP 209 mn. The completed projects, financed by the Ministry of Finance, incorporate a total of 110 buildings consisting of 2k residential units with a capacity to house over 8k residents. Iskandar also announced the launch of the first government volunteer hub in Egypt named Egypt Zones, which is also the first of its kind in the Arab world, according to Al Mal. The move is part of a campaign to help cleaning and sanitation programs in informal settlements called “Together for a prettier Egypt”. Al Mal also reports that results for the Maspero Triangle international masterplanning contest will be announced from 3-9 November. (Read in Arabic)
EUR 15 mn to develop NDP HQ land, says Minister of Antiquities
Al Mal | 26 Aug 2015
The Ministry of Antiquities is looking to the European Union for EUR 15 mn in funding to build two restoration halls and two display halls with previously unseen artifacts on the site of the former National Democratic Party headquarters. The ministry was handed title to the land in March 2014 by the Prime Minister’s office. The ministry hopes to see a 40% rise in the number of visitors to the Egyptian Museum after it adds Nile cruises between the Museum and Manasterly Palace to its repertoire. (Read in Arabic)
TELECOMS + ICT
Link in talks with TE over network usage pricing, wants to provide cheaper internet
Amwal Al Ghad | 27 Aug 2015
Link DSL is in talks with Telecom Egypt (TE) over the proposed prices to use TE’s network infrastructure, according to LinkdotNet’s CEO Waseem Arsany. The talks are the first step of Link’s plans to offer lower ADSL pricing. The company is also finalizing talks with NTRA in order to be able to offer cheaper internet service as per CIT Minister Khaled Negm’s plans. (Read in Arabic)
AUTOMOTIVE + TRANSPORTATION
Tuktuks banned in 15 neighborhoods with addition of Heliopolis, Nasr City, Maadi
Al Mal | 27 Aug 2015
Cairo Governor Galal Mostafa increased the number of neighborhoods in which tuktuks are banned to 15, adding Heliopolis, Nozha, East Nasr City, and West Nasr City, as well as Maadi, Mokattam, and Sayeda Zeinab in the second phase of what he has said is a permanent ban on the three-wheel vehicles. The success of the first phase in the Central and West Cairo neighborhoods played a big role in the quick implementation of the second phase, said Mostafa. (Read in Arabic)
BANKING & FINANCE
EFSA discussing with insurers extending coverage to police and military personnel
Ahram Gate | 27 Aug 2015
Egyptian Financial Supervisory Authority chief Sherif Samy met with the head of the Insurance Federation of Egypt to discuss insure police and military personnel against injury and death in terrorist attacks. Article 54 of the anti-terror law passed earlier this month requires the state to extend insurance coverage to police and military personnel. No details of the meeting’s substance or outcome were made available. (Read in Arabic)
Banking consortium offers EGP 10 bn financial plan to EEHC
Amwal Al Ghad | 27 Aug 2015
A nine-bank consortium has offered the Egyptian Electricity Holding Company (EEHC) an EGP 10 bn loan to finance three combined cycle power stations in El Borolos, the new administrative capital, and Beni Suef, with a total output of 144 MW. The plan’s payment period is over 15 years, with a three year grace period. The banks in the the consortium include CIB, NBE and QNB among others. (Read in Arabic)
LEGISLATION & POLICY
President El Sisi approves Youth Jobs Protocols with ILO
Official Gazette | 27 Aug 2015
President El Sisi official approved cooperation protocols for a “Youth Jobs” programs signed between the Manpower Ministry and the International Labor Organization (ILO) on 31 March. The program allows the ILO to provide training, planning, and technical expertise to a number of labor projects in three governorates.
EGYPT POLITICS + ECONOMICS
Nuclear scientist’s dismissal becomes political football
Ahram Online | 27 Aug 2015
Various political parties and figures issued a statement on Thursday criticizing the decision by the Nuclear Power Plants Authority (NPAA) to pass on renewing the contract of Mounir Megahed as an advisor to the Dabaa nuclear power plant project over security concerns, Ahram Online reported. Megahed, formerly head of the NPAA, was one of the founders of the National Association for Change. The statement in support of Megahed was signed by Hamdeen Sabahi, Khaled Ali, Amr Hamzawy, the Egyptian Current Party, El-Karama Party, and others. (Read)
Four of eight escaped prisoners arrested following Damietta prison breakout: Four prisoners from a total eight who had escaped from Kafr Saad Central Prison in Damietta were arrested on Friday, as reported by Youm7 and the Cairo Post. The prisoners had managed to escape by assaulting a prison guard who was collecting trash from their cells.
ON YOUR WAY OUT
Controversy, petition and belated crowdfunding effort fail to stop sale of ancient Egyptian ‘Sekhemka’ statue by UK museum to unknown buyer: The UK’s export ban on the sale of the ancient Egyptian statue Sekhemka expired on Friday, Ahram Online reported, paving the way for its transfer of ownership to its anonymous buyer. The statue appears to be on its way to be lost indefinitely to the collection of its buyer, following Northampton Borough Council’s auction of the statue last year, the sale having been first proposed in 2012. Antiquities Minister Mamdouh al Damaty had called on Egyptians everywhere to fundraise to be able to purchase the statue, while the former minister Zahi Hawass was set to launch a petition against the sale last Monday. Egypt’s Heritage Task Force issued a statement saying that while they welcomed efforts to recover the statue, the group “rejects the idea of fundraising to purchase the statue at the auction price of GBP 15 mn. Experience shows that when single objects at legal sales reach such high prices, the illegal market of looted object rises as a consequence … It was unethical from Northampton Museum to sell the statue to a private collector and Egyptian institutions should avoid falling into the same unethical system,” the statement reads.
No license plate? What a waste of EGP 200: Cairo Governorate will be issuing a EGP 200 fine for all automobiles running without a license plate. This comes after the launch of a campaign by the Cairo Traffic to impound microbuses without license plates until owners show up with proof they have licensed the vehicles. (Read in Arabic)
Pioneers Holdings’ Q2 profit triples: Pioneers Holding posted Q215 net profit of EGP 321.9 mn on Thursday, up from EGP 96 mn a year earlier, Reuters reported. “The main reason for the leap in profits was the strong performance of the real estate and industrial companies that are part of Pioneers,” chief executive Walid Zaki told Reuters. Pioneers’ 1H15 profit registered EGP 564 mn, up from EGP 217 mn in the same period last year.
According to a post from Mark Zuckerberg on Thursday, last Monday witnessed 1 bn users connect to their Facebook accounts on a single day, a milestone for the internet company.
Stephen Hawking might have found an answer to a 40-year old paradox about how information is lost if an object falls into a black hole even though the black hole emits radiation. His proposition: “Something of the incoming particle’s information is turned into the when-and-how of Hawking radiation: information is transmuted, not lost,” The Economist explains while caveating that “the idea remains a suggestion, rather than a solution.”
BY THE NUMBERS
USD CBE auction (Thursday, 27 August): 7.7301 (unchanged since Sunday, 05 July)
USD parallel market (Thursday, 27 August): 8.00 (+0.03 from Tuesday, 25 August, Reuters)
EGX30 (Thursday): 7,078.83 (+2.99%)
Turnover: EGP 406.1 mn (13% below the 90-day average)
EGX30 YTD: -20.69%
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