What we’re tracking on 23 January 2020
For those of you hoping for a three-day holiday this weekend, we hate to be the bringer of bad news. A cabinet statement on social media yesterday confirmed that Saturday will be a public holiday to mark Police Day / the 25 January Revolution and made no mention of markets being closed on Sunday. We’re heading to work on Sunday, ladies and gents.
GERD talks wrap up in Khartoum today: Technical and legal teams from Egypt, Ethiopia and Sudan will today finish two days of meetings designed to lay the groundwork for a final agreement on the filling and operating timetable for the Grand Ethiopian Renaissance Dam at talks in Washington on 28-29 January.
Renaissance Capital’s annual North Africa Investors Conference (pdf) wraps in Marrakech today. Chairman Christophe Charlier told the conference yesterday that North African countries are now ready to fully industrialize, and described Egypt as a growth market bolstered by strong demographics and the government’s supportive reform program, according to the local press.
Shoukry in Algeria for Libya talks: The foreign ministers of Egypt, Tunisia, Sudan, Chad, Mali and Niger are in Algiers today to begin a new round of discussions on the situation in Libya, the Foreign Ministry said in a statement yesterday. An unnamed source told Reuters that Algeria is looking to build “consensus to secure the maximum chance for a peace [agreement]”. This comes only days after the conference in Berlin made progress towards a more comprehensive truce, with world powers pledging to stop shipping arms into the country under the threat of UN sanctions.
Stuff you can go to this week and next:
- This year’s Cairo International Book Fair kicked off yesterday and runs through to Tuesday, 4 February at the New Cairo International Exhibition and Convention Center.
- AmCham will host US Ambassador Jonathan Cohen for its monthly luncheon on Tuesday, 28 January. Cohen will discuss prospects for commercial ties between Egypt and the US. Members can register for the event here.
- CI Capital’s annual three-day MENA Investors Conference gets underway on Tuesday, 28 January at the Four Seasons Nile Plaza.
- The British Embassy and IFC’s StartEgypt Forum 2020 will pit 45 startups against each other in a pitch competition on Wednesday, 29 January at the Greek Campus.
PSA- There’s rain in the forecast again: The Egyptian Meteorological Authority is forecasting rain over the coming four days, with daytime highs of around 15°C. Our favourite weather app sees suggests we’re looking at a lower chance of rain and will have cold nights this weekend, with overnight lows of 6°C on Friday and 7°C on Saturday.
DAVOS WATCH- The global elite will continue to ponder how to very slowly make the world a better place today as the World Economic Forum enters its penultimate day in Davos, Switzerland. Scanning the global press this morning, you could be forgiven for thinking the forum had morphed into TrumpFest 2020, with the US president stealing headlines on everything from climate and trade to Boeing and Iraq.
Saying that, Trump was involved in what deservedly is becoming one of the biggest stories of the summit: Digital Tax: In the space of two days the Trump administration has made up with France and threatened the UK with tariffs over attempts to impose a “digital tax” on US multinational tech companies. “If people… arbitrarily put taxes on our digital companies, we will consider arbitrarily putting taxes on car companies,” US Treasury Secretary Steve Mnuchin said at the forum yesterday, after the UK chancellor declared he would press ahead with the tax.
This is all part of what Foreign Affairs is describing as a “looming tax war”: For almost 100 years the international community has for the most part agreed on how multinationals should be taxed. But the growing cleavage between nations on how to ensure today’s tech giants pay their fair share in tax threatens to upend this, Itai Grinberg writes. Negotiations are underway at the OECD to try and find an agreement between 135 countries on a new international consensus. If these fall through, the international tax system and the liberal order of things risks collapse, he writes.
Meanwhile: We’re not doing too great on the latest Global Talent Competitiveness Index: Egypt fell one place to rank 97 out of 132 countries in the 2020 Global Talent Competitiveness Index released at the forum yesterday. Weighing down our ranking in particular was our score in the ‘attract’ category, which measures the degree of economic and social openness. Cairo, meanwhile, came second from bottom out of 155 cities, scoring poorly in all of the index’s five categories. You can dive deeper into the country rankings here and the city rankings here.
Al Mashat pitches Egypt investment to global execs: International Cooperation Minister Rania Al Mashat discussed plans to expand Uber’s presence in Egypt with the ride-hailing company’s Vice President Perry Dimitry and Uber’s VP for public policy Justin Kentz, according to a cabinet statement. The Uber duo said that Egypt was the company’s top market in Africa. The minister also discussed private sector funding with Citibank vice chairman for banking and capital markets, Jay Collins, and sustainable development with deputy head of the WEF’s Center for Geopolitical and Regional Affairs, Mirek Dusek.
Qalaa Holdings signed up to the Business Ambition for 1.5°C at the forum yesterday, the company said in a statement (pdf). The campaign, unveiled by the UN at its climate conference in Madrid last year, is trying to persuade business leaders to commit to reducing emissions and limit the rise in global temperatures to 1.5°C.
In other non-Trump news coming out of Switzerland:
- Al Nowais to invest USD 500 mn in renewable energy: The Emirati energy giant plans to set up a fund to boost investments in renewable energy in the Middle East and Africa, Hussain Al Nowais said in an interview at the World Economic Forum in Davos, according to Bloomberg.
- The UK’s Prince Charles unveiled a ‘Sustainable Markets Initiative’ that aims to increase cooperation between the public and private sectors to cut carbon emissions, The Hill reported.
- BP isn’t a fan of some of the climate proposals coming out of the US Democratic Party: CEO Bob Dudley called Senator Bernie Sanders’ plan to generate 100% of the country’s energy from renewable sources “completely unrealistic” in an interview with CNBC.
- Get more creative about planning your futures, OECD tells teens: Career ambitions of teenagers are not changing in line with technological shifts, increasing the chances that their choice of job will be made obsolete by the machines, the OECD warns in a new report.
India’s stagflation is spreading to other EMs: India is witnessing its sixth consecutive quarter of slowing economic growth, despite inflation speeding up for five quarters in a row, Bloomberg reports. Other emerging economies, most of whom are in Asia, seem to be sharing what the site describes as a “stagflationary path” — an economic condition characterised by high inflation and low growth — thanks to the effects of the US-China trade war.
But Egypt is among the economies bucking the trend: Inflation is down 6.5% between 2019 and 2020 and GDP is up 0.2%.
In international business miscellany:
- Boeing could be borrowing north of USD 10 bn to bolster its finances as it continues to feel the effects of the 737 Max crisis, CNBC reports, citing sources with knowledge of the matter. The company suspended production of the passenger jet last year after two fatal crashes.
- Mitsubishi’s subsidiary in Germany raided over potential fraud: The German authorities raided the German subsidiary of the Japanese Mitsubishi Motors, on allegations that it is using software to cheat emissions tests on some diesel-powered vehicles sold in Germany, according to the Wall Street Journal.
- Netflix is downplaying its US subscriber growth slowdown as it battles in “streaming wars” with competitors Disney and Apple, which launched rival services in November, the Financial Times reports. The streaming giant added only 420,000 domestic subscribers in 4Q2019 compared to the 1.5 mn it added in the same period a year ago.
Lebanon to decide on March Eurobond default next week: The new Lebanese government will decide next week whether it will repay its USD 1.2 bn Eurobond when it matures on 9 March, the country’s Finance Minister Ghazi Wazni said yesterday. This came a day after caretaker prime minister Hassan Diab formed a new government, ending almost three months of political gridlock. Bondholders are increasingly concerned that the government could fail to repay the 9 March bond, with investors pricing in a sovereign default at some point in the future.
China has ordered a soft quarantine of Wuhan in an attempt to contain the coronavirus after the death toll yesterday rose to 17, the BBC reports. Public transport in and out of the city is temporarily suspended during a week when mns of people are expected to travel for the New Year holiday. There have been 500 confirmed cases, but some experts have warned that as many as 4k in Wuhan may have contracted the virus.
House Democrats begin to lay out their case against The Donald: Lead House impeachment manager Adam Schiff yesterday accused President Trump of corruption “to cheat” his way to a second presidential term, the New York Times says.
The prince and the post: The UN has called for further probes into claims that Saudi Crown Prince Mohamed bin Salman hacked Washington Post owner Jeff Bezos’ phone in attempt to influence the paper’s coverage, the Wall Street Journal reports.
Forget about stocks, art is your next investment: Our guest on today’s episode of Making It is the founder of Egypt’s largest contemporary art gallery housing over 9k artworks. She explains the ins and outs of how to value a piece of art and how investment is gaining popularity. Her main goal (aside from making a profit of course) is democratizing the art scene to cater to artists and audiences from all backgrounds. Look for the episode in your podcast feed and inbox early this afternoon — just in time for your drive home.