There are three key takeaways from the Egypt Investor Conference in Cape Town last week, Renaissance Capital says. Corporates have welcomed the float of the EGP despite its negative short-term impact on volumes and margins; wages have been adjusted equitably;and “energy subsidy reform is under way, gas supply is improving for industrials, and the Zohr gas field appears to be on track for year-end production.”

RenCap’s chief economist Charles Robertson “sees several reasons why Egyptshould be on top of investors’ agenda. The [EGP] is the cheapest in EM and Africa. There is an already demonstrated commitment to tough fiscal reform, such as energy subsidy removal, with external backing from the IMF. A decade of bank deleveraging means Egypt has huge potential for credit growth. High interest rates are attracting portfolio inflows, and he sees room for credit rating upgrades from 2H17 or beyond. Finally, Charles believes Egypt is relatively insulated from a US recession or a US-China trade war, and that political risks are priced in to FX and bonds.”