Monday, 22 February 2016

Amer won’t consider pound float until reserves recover, asks for “patience” on profit, capital repatriation.


Tarek Amer won’t consider pound float until reserves recover, asks for “patience” on profit, capital repatriation. No sympathy for country’s 100 largest companies. (Last Night’s Talk Shows)

Airlines say their continued operation in Egypt is dependent on ability to repatriate FX. (Speed Round)

Zohr field ready for development, Petroshorouk established. (Speed Round)

Finance Ministry to amend Sukuk Act, eyes Islamic t-bills (Speed Round)

Highlights of day two of Business for Africa Summit include IDB earmarking USD 1 bn for funding trade in Africa, 34 agreements signed. (Spotlight)

Heavy electricity users to subsidize the poor, Shaker says. (Energy)

Dana Gas Egypt to invest EUR 355 mn in E&P in the next three years. (Energy)

Grain trader Al Ghurair Resources plans to expand to Egypt. (Basic Materials + Commodities)

Automotive Division expects a 5% hike in car prices due to FX crunch. (Automotive + Transportation)

By the Numbers


Don’t hold your breath for Prime Minister Sherif Ismail’s speech to the House of Representatives — it may not happen before 1 April. Rep. Bahaa Abu Shokka called in to Amr Adeeb’s OSN show last night to say the House of Representatives’ internal bylaws won’t be complete before next week. In constitutional terms, he says, this means the House won’t be able to pass laws until then. Adeeb then suggested that, in fact, no laws could be enacted, amended, or rejected before April Fool’s Day. (He said 1 April, actually. The April Fool’s bit is on us.) Abu Shokka agreed, saying the house cannot review laws until 28 subcommittees are formed. And until Article 146 of the constitution on the appointment of cabinet is enforced, the president is allowed to “reshuffle cabinet,” he added. Legal and Parliamentary Affairs Minister Magdy Al Agaty also called in, saying the government is ready to present its program to parliament, but it’s the House causing the delay (watch in Arabic).

The Suez Canal Global Conference kicks off today at the JW Marriott Hotel and wraps up on Wednesday.

Some media outlets are reporting that a number of low-ranking members of the police force will hold a strike today in response to the arrest of seven of their peers, DNE reports. We have more coverage in our Talk Show segment.

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The fifth Euromoney GCC Financial Forum takes place at the Four Seasons Manama in Bahrain on Tuesday and Wednesday (press release here, conference website here).

The official opening of the 8.5 km-long, 18 m-deep East Port Said Side Channel is also on Wednesday and will be attended by Prime Minister Sherif Ismail. The test launch for the channel was conducted successfully, with eight ships passing the channel on Sunday.


We’re opening the GCC alpha edition to everyone who has written in asking to be added to the list. You can also sign up via this link. The alpha edition will be published 2-3x weekly during the workday until mid-February, then move to a Sunday-Thursday publication schedule, delivered before 6am KSA / 7AM UAE.


Central Bank of Egypt Governor Tarek Amer, interviewed by Ibrahim Eissa on Al Kahera wal Nas:

The interview was, for the business community, probably the most-anticipated talk show “event” of the season (to use the language of American television). Our take is below, or you can watch the full interview here (running time: 1:20).

We are in a financial crisis, but Egypt will overcome it and the CBE remains optimistic, Tarek Amer reiterated throughout the interview, adding that present-day investment in infrastructure will drive future economic growth. The primary theme that came through, however, was Amer’s caution in not “showing his hand” or revealing the CBE’s exact policy direction in the near future.

“As a rule, central banks do not disclose their intentions publicly … I communicate with the market by sending signals … like the EGP appreciation, which came against all expectations… Monetary policy management is based on the management of expectations,” he told Eissa.

Notably: Amer also declined to talk about how the CBE is sourcing the FX that has kept reserves largely stable despite mounting demand, shrugging off Eissa’s persistent questioning.

Amer’s sanguine and accommodating tone disappeared only when he spoke about “some domestic manufacturers” and “importers.” The private sector, of which “the top 100 companies have an average return of 14%,” gets no sympathy from Amer, who was particularly displeased with the automotive industry. These largest 100 companies “are doing well,” a fact reflected in the banking sector’s healthy profits and low NPL rates. “We need to have a fair deal,” Amer said, perhaps unconsciously borrowing from Harry Truman as he noted that Egypt provides the manufacturers with cheap labor, cheap fuel, and a low tax rate. “We just like to complain all the time,” he said. The governor did concede that foreign companies have the right to complain of an FX shortage recently.

He was less clear when it came to the repatriation of profits. Amer insisted that the CBE ensures investors have the right to repatriate their capital and profits, but he agreed that companies might have faced some challenges recently in this department. Business should “be patient with us this year,” Amer said.

Amer indirectly blamed the FX shortage on importers and the state’s increased expenditures: “The people are creating the FX shortage … it’s not [the drop in] tourism … inflows had already dropped, but were compensated for by increased remittances … we just spend too much … we need to lower our general expenditures … state salaries have increased.”

Cut state spending and reconsider the civil service law, Amer urged the House of Representatives, moving on to criticize the Finance Ministry for leaking news that it is preparing a budget based on a scenario with a weaker exchange rate of EGP 8.25 per USD 1. “This was an internal exercise … it should not have been made public in that way,” Amer said sternly, “exchange rate decisions are the CBE’s,” not the ministry’s.

Amer stressed that the CBE remains independent of the government: “We do not get policy directives from Ittihadiya … we coordinate some policies … based on mutual agreement … [you] can’t say we’re following ‘liberal’ or ‘socialist’ policies, we view the facts facing us and take decisions accordingly.” Case-in-point: the SME financing initiative, which he says is partly a drive by the CBE to attract more companies into the formal economy. He says, “We spoke at the coordinating council and said informal business will be tax-exempt for all the years prior to registration, maybe for even a year or two extra … we are trying to get more businesses registered.” Amer downplayed a suggestion that the initiative might turn into “another Social Fund for Development” with a large number of distressed loans: “The pledge is that we are seasoned bankers … some banks already have experience with that … their distressed loans [in the SME sector] do not exceed 1%.”

Amer made two clear statements that caught our attention during the interview:

  • Talk of an impending float of EGP is nonsense: “We have no intention to float the EGP currently,” he said. However, Amer set a target for possibly removing the de-facto USD peg: “[Flotation] is something we might consider only when the reserves are at the USD 25-30 bn level.”
  • The renewed drive to list state-owned banks in the stock market is not the “privatization” drive of the previous two decades. The government will retain controlling stakes and the CBE has the tools “to stop any policies that we see as damaging to the economy.” Amer explicitly said the CBE will not continue to own the United Bank of Egypt; it has restructured it and restored its capital and will return it to private ownership.

The CBE governor made his beliefs clear when he said the CBE cannot remain “a market regulator” and “a market participant” at the same time and said listing state entities serves a crucial economic purpose. “We’re not ‘privatizing’ banks …foreign investment either comes through FDI or through portfolio investments … larger amounts usually flow through portfolio investments … we are listing banks to attract funds to Egypt and use them for economic development projects.”

…Amer also pledged that:

  • The EGP is a sound bet: Amer said the CBE will continue to support the EGP. “The CBE pledges that, over the medium term, returns on the EGP will always be higher than the USD,” the Governor promised. The CBE will continue to support the EGP because if it stops, “people will abandon it for other assets … [and] drive inflation … The CBE’s support of the EGP is to maintain control over the general price level and protect savings against runaway inflation … this is the CBE’s prime mandate.”
  • Importers to get some reprieve in 2017: Trade will become easier in a year’s time, “next year … we will have a freer market where importers are able to access trade finance instruments more easily and release their goods from ports in a shorter time.”

Lamees El Hadidy on CBC Egypt returned to the issue of the police last night, noting that on Saturday, seven non-commissioned police officers were arrested before they were set to make an appearance on Wael El Ebrashy on Dream TV on Saturday, based on a tip they were allegedly planning on inciting against the Interior Ministry. Sources say they were simply set to appear to speak on problems affecting NCOs, with El Ebrashy reportedly condemning their arrest. El Hadidy once again reiterated the police officer in the Darb El Ahmar killing appears to be receiving swift justice due to demonstrations, which she argued is problematic. “Do people have to protest, and apply pressure, and surround police stations, just so people can see justice?” She further argued without deep and systemic reform, we will continue to see protests such as those at Darb El Ahmar. (Watch in Arabic, run time: 5:21)

Supply Minister Khaled Hanafi called in to talk about the shortage of subsidized foodstuffs. The minister said the current shortage of edible oils has been resolved, adding that the companies are now producing at double the daily demand to plug the gap (watch in Arabic, run time 12:54). The ministry is also working to “break the monopoly” and stop relying on leading suppliers so as to secure goods at lower prices.

Amr Adeeb on OSN gave us a bit of clarity on the issue of the four-year-old boy sentenced to life for murder in a judicial snafu. According to a Facebook statement from the armed forces spokesperson, it was apparently a misunderstanding due to similarities between the name of the actual (16-year-old) perpetrator and the accused. Adeeb pointed out that the technicalities no longer matter now that the world sees us as a country of “lunatics” (watch in Arabic, run time 5:03). We’d add that 4-year-old or 16-year-old: It’s a minor child sentenced to life in any case.


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International airlines say their continued operation in Egypt is contingent on their being allowed to repatriate profits, Al Shorouk reports. Air France and KLM have reportedly threatened to halt flights to and from Egypt, claiming they are unable to move abroad certain funds they have in Egyptian banks. Tourism Minister Hisham Zaazou is said to be working with the CBE on getting the parties to agree to repatriate the funds in installments over four to six months.

While state-owned Al Ahram says FX bureaux are toeing the central bank’s line on the USD : EGP exchange rate, currency dealers speaking with Al Masry Al Youm say a black market for USD has begun to develop around gold and cloth merchants. The CBE kept the exchange rate at EGP 7.73 to USD 1 at its FX auction on Sunday, selling USD 38.8 mn, according to its website. The USD was trading at EGP 9.10 on the parallel market, Reuters reports.

Is the CBE making exceptions for contractors? The CBE lowered the EGP deposits required to cover LGs to 70% from the standard 100% for construction contractors, while lowering commissions to banks on LGs to 0.1% of the amount covered from 0.75%. The move follows a meeting between Tarek Amer and the Egyptian Federation for Construction and Building Contractors, said the federation’s head Hassan Abdel Aziz. Amer promised to resolve the issue of LGs for companies operating abroad and will expedite LGs for companies nearing the completion of projects abroad. The federation had suggested using local banks, Al Borsa reports.

The Automobile Distributors Division of the Cairo Chamber of Commerce is lobbying for its on how to make FX liquidity available for the industry following a meeting on Sunday. The plan’s key feature includes lifting the limit on USD deposits and adopting the parallel market rate, said the division’s head to Al Mal.

Oil Ministry completes formalities for Zohr field development to begin, creates Petroshorouk: Formalities to allow the development of the supergiant Zohr field have been completed, according to Oil Minister Tarek El Molla. Al Shorouk writes that Eni subsidiary IEOC has formed Petroshorouk, a JV with EGAS subsidiary Petrobel, which will be tasked with developing Zohr. The portion of the project allocated to domestic companies has been increased to USD 12 bn, El Molla says. Petrojet and Enppi are participating as primary contractors, in addition to Italy’s Saipem, which is supplying the rig drilling an exploratory well now. Reuters writes that the development plans entail beginning production by the end of 2017 to reach about 500k bbl of oil equivalent per day by 2019.

…speaking of IOCs, sources tell Al Mal that the first tranche of the USD 1 bn World Bank loan agreed in December may be used to repay part of IOC receivables. The funding has not arrived yet as it awaits parliamentary approval, the sources add.

The Finance Ministry is making amendments to the Sukuk Act, which which will include provisions allowing for shariah-compliant treasury bonds, suggests Finance Minister Hany Dimian. The Islamic Development Bank and Al Azhar are advising on the measure, and the ministry will form a religious council to review the bill ahead of introducing it to the House of Representatives. In an interview in Al Masry Al Youm, Dimian tried to assuage fears on the inflationary effects of the value-added tax. He states that essential goods and services (food, transportation, health) will be VAT-exempt, the required minimum sales to register has been set to EGP 500k, and that the VAT will result in a one-time 1.5 point bump in inflation. Dimian stressed the need for the legislation in light of the government only collecting 50% of taxes it is owed.

A “provisional agreement” on a ceasefire in Syria was reached between the U.S. and Russia, according US secretary of state John Kerry said on Sunday, but the plan has been called into question after car bombs left almost 150 dead, Reuters reports. Several blasts in a southern district of Damascus killed at least 62 people while twin car bombs killed at least 57 in Homs, according to the Britain-based Syrian Observatory for Human Rights.

Correction: In yesterday’s issue we mistakenly named Olga Kefalogianni as the Greek tourism minister, who would be Elena Kountoura. Kefalogianni served as the tourism minister until 25 January 2015.


The latest FTfm is out, with the spotlight on the fund management industry (landing page here) carrying at least two pieces worth reading depending on what you do for a living:

Ah, just what we need: More volatility. The FT (paywall) writes that foreign bond buyers are girding for the effects of “Brexit” on UK companies and banks. With the referendum set for 23 June, “Investors globally, in Asia, Europe and the US …  want to understand what does it mean for the UK banks and … the broader European banking system,” according to managing director at Nomura David Hague.

General Motors (GM) is reportedly reconsidering its plan to invest USD 1.62 bn in Brazil through to 2019 if the economic and political situation does not improve, Reuters reports. GM temporarily halted production in Egypt in February because it could not access USD to pay for international components. So to recap, it’s not a good year to be either GM, Brazil, or Egypt.


Foreign coverage on Egypt last night was mainly preoccupied with the the shutdown of the Nadeem Center, which has reportedly filed an emergency application to a court in the hope of halting plans to shut it down on Monday, Reuters reports. “The Egyptian authorities are smothering the country’s leading human rights defenders one by one,” Sarah Leah Whitson, HRW’s Middle East director, said last Wednesday, according to a NYT pickup of an AP story. “Closing the Nadeem Center would be a devastating blow to Egypt’s human rights movement as well as victims of abuse.”

Also making headlines is Ibrahim Eissa’s “stinging” article published on the front page of Al Maqal (appears to be paywall, or just incredibly difficult to access) that said President Abdel Fattah El Sisi presided over a “theocracy” that is no different from the Islamist-led government he overthrew in 2013, according to an AP story. Eissa was up in arms over the jailing of author Ahmed Naji, saying, “Your state and its agencies, just like those of your predecessor (Islamist Mohammed Morsi), hates intellectuals, thought and creativity and only likes hypocrites, flatterers and composers of poems of support and flattery,” one news outlet quotes the piece as saying. The op-ed seems ran on page 1 of yesterday’s edition of the paper.

SPOTLIGHT ON day two of the Business for Africa Summit

The second and final day of the Africa 2016: Business for Africa, Egypt and the World saw Investment Minister Ashraf Salman announce the signing of 34 agreements:

  • Schneider Electric signed an agreement for a EUR 50 mn solar power plant in Sharm El Sheikh;
  • An MoU signed between the General Authority for Investments and Free Zones with the Gabon Investment and Export Promotion Agency to exchange information and know-how in the interest of growing investments;
  • A cooperation agreement signed by the Egyptian Agency of Partnership for Development and the Social Fund for Development to plan a development strategy for Africa.

Salman also announced that Huawei will participate in Egypt’s subsidy smart-card system.

Meanwhile, the Islamic Development Bank announced that it earmarked USD 1 bn to finance African trade, Al Mal reports, and Banque Misr said it was considering plans to enter Cote D’Ivoire as part of its Africa expansion strategy. The announcement follows talks between the bank’s head, Mohamed El Ettreby and Cote D’Ivoire’s trade minister. The plans are still in the development stage, said the BM chief said.

The ministers of housing, electricity, and irrigation pitched a number of projects they would like the AfDB to fund. AfDB President Akinwumi Adesina heard International Cooperation Minister Sahar Nasr call for more funding to help with sewage and waterworks projects, while the Irrigation Minister prioritized the development of the Lake Victoria-Mediterranean Nile river route. Separately, the Transport Ministry said it would send a delegation to the COMESA High Level Infrastructure Investment Conference to discuss the route, according to Al Mal. The Electricity Minister asked for aid for the transmission capacity build-up strategy. Adesina confirmed funding for the waterworks project and the AfDB’s support for the transmission build-up project, and expressed interest in the Nile transport route, Al Borsa reports. Adesina also said the bank is ready to support Egypt’s fiscal budget, adding that the bank plans to launch an initiative to employ African youth, through which numerous projects for Egypt’s youth can be financed, according to an Ittihadiya statement.

President Abdel Fattah El Sisi announced that Egypt is willing to launch a project linking the country overland with Ethiopia through Sudan, according to Al Masry Al Youm. At a meeting with African business leaders, El Sisi stated that he approached international finance institutions to ask for facilities to fund logistics infrastructure and networks linking the continent. The president also stated that Siemens will complete 50% of its power projects in Egypt by the end of the year.

A number of Egyptian businessmen attended the meeting and expressed their views on investments in Africa. TAQA Arabia’s Khaled Abu Bakr discussed Angola’s promising mineral resource investments, and Polyserve Fertilizer’s Sherif El Gabaly discussed Africa’s fertilizer opportunities, AMAY reports.

El Sisi met with Sudanese leader Omar Al Bashir and Ethiopian PM Hailemariam Desalegn for the second Tripartite Summit in Sharm El Sheikh. The three agreed to:

  • Instruct their foreign ministers to write up an institutional framework to enhance cooperation, with the proposal to go to the next Trilateral High-Level Committee;
  • Establish a trilateral fund to implement development projects;
  • Create three committees (political, economic, and social and cultural) to look into areas of cooperation, including ICT, agriculture and the management of water resources, tourism, military training, and trade;
  • Encourage joint parliamentary meetings and exchanging visits between all three parliaments;
  • Hold annual trilateral consultations.

They will discuss the agreements reached on Saturday at their next meeting, which is set to take place six months from now.

Also speaking at the summit was Trade and Industry Minister Tarek Kabil, who espoused the necessity of developing a homegrown automobile manufacturing sector in Africa to move away from being assemblers, Al Mal reports — possibly an indication that Egypt’s so-called “automotive directive” may not yet be a dead letter.

EGX head Mohamed Omran spoke on the growing importance of capital markets in Africa. Capital markets in the continent approached USD 1 tn USD by the end of 2015, while IPOs grew to a record USD 12 bn, said Omran. Al Mal is also reporting that the Congo approached Egypt to help form a stock exchange.

The ICT Ministry is looking for investment bankers to help raise capital for a company the ministry will form to build the technology zones, announced ICT Minister Yasser Al Qady at the summit. Up to 80% of the company’s equity will be up for grabs by the private sector, with the ministry holding the balance. The company will initially develop six tech hubs, Al Borsa reports.


How People Learn to Become Resilient, Maria Konnikova, The New Yorker. One of the major gripes some of us here have is the way many if not most Egyptians of all political orientations approach our country’s problems and the world at large: a fatalistic focus on the external rather than looking inward at what we can do to improve our own outcomes. This concept is referred to in psychology as locus of control, which broadly speaking refers to the degree of control individuals believe they can exercise over events in their lives, first put forth by Julian B. Rotter in 1966 (pdf) and further refined by Carl Anderson in 1977. Those who display a higher internal locus of control, i.e. that they can shape their lives rather than be acted upon externally, have been “found to perceive less stress” and perform better in school, among other benefits. Maria Konnikova’s latest piece for the New Yorker examines the relationship between resilience and having an internal locus of control, with regard to a study of children who were expected to struggle due to their adverse backgrounds but who instead excelled. (Read)


Heavy electricity users to subsidize the poor, Shaker says
Electricity subsidies to the poor will not be borne by the state, but by the heaviest consumers, Electricity Minister Mohamed Shaker says. Within five years, electricity subsidies to the heaviest consumers will disappear, leaving only EGP 9 bn worth of subsidies going toward lighter consumers and poorer segments of the population. The cost of that subsidy will be borne by the heavier users through a tier system based on the level of consumption, Shaker explains. (Read in Arabic)

Dana Gas Egypt to invest EUR 355 mn in E&P in the next three years
Dana Gas Egypt has plans to invest EUR 355 mn in an E&P schedule that includes drilling at least 20 development wells, up to six exploration wells, and improvements to existing plants, Dana Gas Group CEO Patrick Allman-Ward tells Daily News Egypt. “The important things for a private-sector investor are respect for contracts, rule of law, and the ability to return dividends to the country of origin of investment,” he adds, commending the government for its commitment to production-sharing contracts with investors. Dana Gas Egypt has over EUR 155 mn outstanding on invoices worth EUR 215 mn, Allman-Ward notes, but the company has reached an agreement that will let it recover the amount overdue via the sale of the state’s share of incremental liquids from its future production. (Read)

TBEA offers to arrange a USD 500 mn loan for the Electricity Ministry
China’s Tebian Electric Apparatus has offered to arrange a USD 500 mn loan from the Export-Import Bank of China on behalf of the Electricity Ministry to fund various projects. The 15-year loan would have an interest rate of 2.5% and a 14-24 month grace period, Al Borsa reports. (Read in Arabic)


Grain trader Al Ghurair Resources plans to expand to Egypt
UAE-based grain trader Al Ghurair Resources plans to boost its grain production capacity by 20% this year as it intends to expand in Egypt and Iran, Chairman Essa Al Ghurair tells Mubasher on the sidelines of the Gulfood 2016 exhibition in Dubai. The group is looking to increase its gain production to 6 mn tons this year from 5 mn tons in 2015. The plan follows news of Egypt’s wheat woes, after several wheat shipments were returned and tenders cancelled due to low turnout. (Read)


Private sector is not importing natural gas because it’s cheaper to buy the government’s, Kabil says
The private sector is not importing natural gas directly because it is cheaper to buy it from the government, Trade and Industry Minister Tarek Kabil tells Al Mal. The main impediment to importing gas directly is the cost of shipping from ports to factories, Kabil says. Gas prices would be USD 1 per mmBtu higher if the private sector imported the fuel themselves, he adds. (Read in Arabic)


Health Ministry to build, overhaul 135 hospitals by 2017
The Health Ministry has earmarked EGP 7 bn to construct or overhaul 135 hospitals over the next two years, Health Minister Ahmed Emad El Din tells Al Borsa. Twenty-five of the hospitals will be completed by May, he adds. The project will be financed through the ministry’s budget for the current and coming fiscal years, with the ministry allocated EGP 48 bn in the state budget, EGP 4.7 bn of which goes to investments, Al Borsa notes. (Read in Arabic)


Housing Ministry to set up the company building the new administrative capital next month
The Housing Ministry will inaugurate the company that will be tasked with overseeing the building of the new administrative capital “next month,” Housing Minister Moustafa Madbouli says. The New Urban Communities Authority’s share in the company will be 50%, he says, according to Al Borsa. International Cooperation Minister Sahar Nasr said the African Development Bank will not be presenting any financing for the project. Instead, Al Masry Al Youm reports AfDB’s contribution will be limited to technical assistance.

OHC talks with Housing Ministry on buying out foreign shareholders are “preliminary”
Talks to have the Housing Ministry buy foreign shareholders’ stakes in Orascom Housing Communities (OHC) are only in their preliminary phase, Orascom Hotels and Development told the EGX. The company wanted to clarify that no agreement has been reached yet, that it controls only a 35.25% stake of OHC, and that Samih Sawiris is not OHC’s chairman. The ownership stake being negotiated represents 23% of OHC’s shares, according to the statement. The two offshore shareholders are named as U.S. companies Blue Ridge and Equity International.

Tourism Development Authority to tender 38 mn sqm
The Tourism Development Authority (TDA) plans to tender 38 mn sqm of land around existing developments earmarked for expansion plans. The move is an attempt to generate investment revenues for the TDA after not having tendered land for a while due to pricing delays by the Investment Ministry. The New Urban Communities Authority (NUCA) and GAFI are working on setting prices for the land, says TDA head Serag El Din Saad. Early indicators from NUCA place the price range of land from USD 10-30 per sqm. (Read in Arabic)


Huawei to offer Egypt new services, looking to expand in Africa
The ICT Ministry plans to grow Huawei’s investments in developing infrastructure and plans to develop an electronics industry in addition to providing technical training and IT services to government bodies, Al Borsa reports. Huawei says it wants to utilize agreements Egypt signed with the COMESA-EAC-SADC tripartite, and use Egypt as a gateway to Africa. The ICT minister will visit China in March to discuss these projects with company representatives. (Read in Arabic)


Automotive Division expects a 5% hike in car prices
The price of new models could rise 5% as a result of the FX crunch, says Alaa Al Saba’, a member of the Automotive Division of the Federation of Egyptian Chambers of Commerce. 55% of importers have been negatively impacted by monetary restrictions, he adds. Car imports fell short of projections by around 120k cars, shaking confidence in regularity of Egyptian imports, Al Saba’ told Al Ahram. Car dealers caught flak from the Consumer Protection Agency in late November when they pinned rising car prices on the FX crunch.

Government to double cost of Metro ticket
The price of the Cairo Metro ticket will double to EGP 2, a Transport Ministry spokesperson tells Ahram Online. Students, the disabled, and lower-income commuters will be exempt from the new price. “The decision won’t need parliamentary approval and is expected to be effective before the end of the current fiscal year in June,” Ahram Online reports. Last month, a ministry spokesperson made the same announcement but said it required House approval.  Fare evasion currently costs the state between EGP 50 mn and EGP 60 mn a year.

Nippon Koei consortium qualifies as Fourth Metro consultant
The National Authority for Tunnels has approved the technical bid from the Nippon Koei-led consortium for the Fourth Metro line consultant tender, reports Al Borsa. The tender was issued in the last quarter of 2015, and the Nippon Koei group was the only applicant, say sources. The first phase of the project will cost a total of total USD 1.2 bn, which will be financed through a facilitated loan from JICA that carries a 0.2% interest and has 10 years before it must be paid back. (Read in Arabic)


Suez Canal projects will not be affected by FX crunch, says Darwish
The shortage of USD in the market will have impact on efforts to attract investors to the Suez Canal Development Area as most of the projects there will be geared towards exports, its head Ahmed Darwish tells Al Masry Al Youm. He noted that the Suez Canal Development Project is currently choosing consultancies to help devise new incentives for the  zone. (Read in Arabic)

Suez Canal looks to boost revenues, again
And in what appear to be updates preceding the Suez Canal Global Conference, Chairman of Suez Canal Authority (SCA) Mohab Mamish says the authority plans to boost Suez Canal revenues through a three-point strategy after studies conducted by the Planning and Research Department at the SCA showed rates of trade between China, Europe, and North America are expected to improve in 2H2016, Daily News Egypt reports. The first is to add over 15 new boats to the fleet of tugboats used to guide ships in the canal, the second is to increase revenues from logistics services, and the third is attracting new shipping lines, whether through bilateral agreements with specific companies or through transit offers to ships from other Arab countries, such as Kuwait. The DNE has stories on the SCA here, here and here.


The gag order on the developments of the Daba’a nuclear power plant project is to ensure that it progresses “without obstacles,” Electricity Minister Mohamed Shaker explains to Al Borsa. The details of the financial and technical details should not be discussed openly, he says, noting that “all reports” of the financial aspects of the agreement are untrue. An official announcement will be made once the agreement is finalized.

The House of Representatives has approved the resignation of MP Serry Seyam from parliament, Al Mal writes. Seyam was appointed to the House of Representatives by President Abdel Fattah El Sisi.

Emirates and Visa have announced discounts of up to 15% on airline tickets for Visa cardholders in Egypt, reports Al Mal. The discounts are valid for all weekend tickets reserved before 27 March through the Emirates website, and are valid for flights up until 25 June.

One civilian was killed and 16 civilians and policemen were wounded on Sunday in three blasts in northern Sinai, Reuters Arabic reports. Militant group Ansar Beit El-Maqdis are reportedly the main suspects, but so far no group has yet claimed responsibility.

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USD CBE auction (Sunday, 21 February): 7.7301 (unchanged since Wednesday, 11 November 2015)
USD parallel market (Sunday, 17 February): 9.10 (unchanged from Thursday, 18 February, Reuters)

EGX30 (Sunday): 6,008 (1.1%)
Turnover: EGP 258.1 mn
EGX 30 year-to-date: -14.2%

THE MARKET ON SUNDAY: EGX30 hovered around the 6,000-point mark for most of the session and ended the trading day up 1.1%. Eastern Company, Juhayna Food Industries, and United Arab Stevedoring were the day’s top-performing stocks. Edita Food Industries, Crédit Agricole-Egypt, and Porto Group were the worst performers.  At a market turnover of EGP 258.1 mn, foreign investors were the sole net buyers. Re­gionally, Saudi Arabia’s TASI and Abu Dhabi’s ADX General Index both fell 0.1%, while Dubai’s DFM Gen­eral Index inched up 0.03%.

Foreigners: Net long | EGP + 7.7 mn
Regional: Net short | EGP – 2.4 mn
Domestic: Net short | EGP – 5.3 mn

Retail: 79.3% of total trades | 78.2% of buyers | 80.4% of sellers
Institutions: 20.7% of total trades | 21.8% of buyers | 19.6% of sellers

Foreign: 7.7% of total | 9.2% of buyers 6.2% of sellers
Regional: 5.6% of total | 5.1% of buyers | 6.0% of sellers
Domestic: 86.7% of total | 85.7% of buyers | 87.8% of sellers

WTI: USD 29.71 (+0.24%)
Brent: USD 33.04 (+0.09%)
Gold: USD 1,224.80 / troy ounce (-0.49%)

TASI: 5,880.61 (-0.06%)
ADX: 4,208.93 (-0.09%)
DFM: 3,093.90 (+0.03%)
KSE Weighted Index: 351.86 (+2.03%)
QE: 9,907.82 (-0.60%)
MSM: 5,412.280 (-0.13%)


22-24 February 2016 (Monday-Wednesday): The Suez Canal Global Conference, JW Marriott Hotel, Cairo.

24 February (Wednesday): N Gage’s Customs Debates 2016: The Impact of the 2016 Customs Reforms on Trade Facilitation, Four Seasons Nile Plaza, Cairo. Register here.

27 February (Saturday): Prime Minister Sherif Ismail presents his government’s national agenda to the House of Representatives.

28 February-02 March (Sunday-Wednesday): President Abdel Fattah El Sisi visits Japan.

01 March (Tuesday): The EBRD-hosted The Rise of Women Journalists in the Arab World discussion, EBRD Auditorium, London, UK.

02-04 March (Wednesday-Friday): President Abdel Fattah El Sisi visits Korea.

07-09 March 2016 (Monday-Wednesday): The EFG Hermes 12th Annual One on One Conference 2016, Atlantis, The Palm, Dubai.

15-16 March 2016 (Tuesday-Wednesday): U.S. Federal Reserve’s Federal Open Market Committee meets. Fed chair will hold press conference.

17 March (Thursday): Wamda’s Mix N’ Mentor Cairo 2016 – Marketplace Edition, The Greek Campus, Cairo. Register here.

23-24 March 2016 (Wednesday-Thursday): Microfinance Egypt, Nile Ritz-Carlton, Cairo.

29-31 March 2016 (Tuesday-Thursday): Future Rail and Metro Egypt, Cairo.

13-16 April 2016 (Wednesday-Saturday): Cafex, Cairo.

25 April 2016 (Monday): Sinai Liberation Day (national holiday)

01 May (Sunday): Easter Holiday / Labour Day (national holiday)

02 May (Monday): Sham El Nessim (national holiday)

06 October (Thursday): Armed Forces Day (national holiday)

27 November 2016 (Sunday): 2016 Cairo ICT Conference

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