What we’re tracking on 21 October 2019
It’s shaping up to be a rather busy week for our elected representatives, who are due to host what feels like half of cabinet for hearings on proposed legislation or to respond to House inquiries, Youm7 reports. On the guest list:
- Trade Minister Amr Nassar, who will answer questions from the Industry Committee on problems facing investors regarding the allocation of industrial land;
- Housing Minister Assem El Gazzar, who will face questions on the country’s potable water and sewage systems;
- And the social solidarity, local development, health, manpower, and agriculture ministers, who will also either give speeches or meet with committees.
Up for discussion tomorrow: Public Enterprise Minister Hisham Tawfik will discuss the proposed amendments to the Public Enterprises Act (more on this in this morning’s Speed Round, below), while Higher Education Minister Khaled Abdel Ghaffar will outline a bill to establish the Zewail City of Science and Technology.
A delegation of US companies will be in Cairo on 18 November to explore investments in the energy, health, information technology sectors as part of AmCham’s US-Egypt Proposer Forum, CEO Sylvia Menassa said, according to the local press. AmCham will also participate in a Washington conference focused on water issues on 30 October, and hold the ‘Prosper Africa Event’ on 7 November.
President Abdel Fattah El Sisi and Ethiopian Prime Minister Abiy Ahmed are set to meet on the sidelines of the Russia-Africa summit this week to discuss the impasse over the Grand Ethiopian Renaissance Dam. Russian President Vladimir Putin seems to be positioned as a mediator between the two countries, which Kenyan publication the East African says is “one of [Russia’s] trickiest diplomatic forays yet.” The two-day event gets underway in Sochi on Wednesday.
Talks with Ethiopia are on the radar of the foreign press, with the Financial Times’ Heba Saleh noting the continued deadlock.
Speaking of water: Cairo Water Week kicked off yesterday at Al-Manara International Conference Center in New Cairo, under the title “Responding to Water Scarcity.” The conference will run until Thursday.
Other key dates to pencil into your agendas this week and next:
- The14th International Joint Oil Data Initiative (JODI) Conference kicked off in Cairo yesterday and wraps up later today.
- The Intelligent Cities Exhibition & Conference will take place at the Hilton Heliopolis on Wednesday and Thursday.
- A B2B conference for German and Egyptian companies will take place on Monday, 28 October in Cairo. Click or tap here to register.
- The US Federal Reserve will meet on 29-30 October to review key interest rates.
Final day of IMF, World Bank annual meetings reaches new levels of ominous: The final day of the IMF and World Bank annual meetings in Washington yesterday saw finance ministers and central bankers grapple with what is perhaps the biggest economic challenge of the decade: How to prevent the global economy from slipping into what some fear could be a deep recession with what is a dwindling basket of policy tools.
Confronting the uncomfortable reality: Central banks are being backed into a corner. Finance leaders are becoming concerned about the increasingly blunt monetary policy tools held by central banks, Bloomberg says. With interest rates already low across the developed world, few now believe that rate cuts have the ability to steer the global economy out of trouble like they once did. “They’re in a very difficult corner at the moment,” Axel Weber, chairman of UBS Group, said at a conference organized by the Institute of International Finance yesterday. “Central banks are running out of efficiency of their tools. Taking interest rates negative will not have the same impact.” And despite the recent relative thaw in US-China tensions, the Financial Times reports that ministers and central bankers are privately fearful that the volatile trade situation might yet push the global economy into recession.
Former Bank of England governor calls for sea change in economic thinking to prevent “armageddon”: Mervyn King yesterday warned that the US economy faces “financial armageddon” unless policymakers take inspiration from the 1930s and adopt new approaches to monetary policy, the Guardian reports. “Another economic and financial crisis would be devastating to the legitimacy of a democratic market system. By sticking to the new orthodoxy of monetary policy and pretending that we have made the banking system safe, we are sleepwalking towards that crisis,” he said.
The answer? It’s complicated.IMF head Kristalina Georgieva’s call for more flexibility on fiscal policy received a mixed reception from attendees, Bloomberg reports. While Japan and the US said they were ready to deploy fiscal stimulus where necessary, Austria and Germany are continuing to prioritize their budget surpluses. Others, meanwhile, were debating the utility of so-called Modern Monetary Theory (a set of economic principles that advocate large-scale government spending and the use of taxation to control inflation) to solving our problems. In short, there seems to be little consensus among the economic powers-that-be about how to bring an end to economic stagnation.
Is CEO duality a thing of the past? Companies that have grappled with governance and misconduct scandals (ahem, Tesla, Boeing, and Renault) are moving away from the idea that CEOs can simultaneously act as chairs of the board of directors, the Economist says. As seen in the chart above, the percentage of S&P 500 companies with CEO-chairmen has nearly halved between 2001 and 2019. Interestingly enough, the Economists suggests there are no inclusive studies that link the practice to worsening company performance.
Saudi Aramco has postponed its IPO once more, confirming a report in the Financial Times this weekend and prompting speculation by some in the industry that the latest postponement could signal the transaction is postponed. What does this mean for Egypt? We have thoughts in this morning’s Speed Round, below.
So how did the guinea pigs in the world’s first 20-hour flight fare? Apparently, not so badly. Twenty hours on a plane is nobody’s idea of fun, and this 16,200 km non-stop flight from New York to Sydney involved some quite prescriptive monitoring of its few dozen passengers to assess their physical and mental well-being. On balance, it’s challenging but well worth it to skip layovers and queues, writes Angus Whitley in this piece for Bloomberg.