What we’re tracking on 22 April 2020
Good morning, friends. We hope this shortened workweek is treating you well as we hurtle along this news rollercoaster known as 2020. We’re really starting to wish we had sided with the people who argued 2020 was the last year of the previous decade, not the first year of a new one. If we change our answer to 2021, does that mean we get a do-over?
It’s (probably) three days until Ramadan. Dar El Ifta will meet this evening to determine whether the holy month will begin tomorrow or on Friday based on its sighting of the moon. Lunar calendar calculations suggest Friday is the most likely first day of Ramadan. We were wrong yesterday in saying there would be no moon sighting: The sighting is still happening, but the traditional celebration that follows has been canceled due to covid-19.
We should also know today whether the duration of the nighttime curfew will be extended, curtailed or left unchanged. Government officials have warned in the past two days that while they may make changes to curfew for Ramadan, it is not a given and claims on social media that it would run from 4pm through 6am were untrue.
We should also know by tomorrow where we stand measures to contain the spread of covid-19, including the suspension of schools and flights.
Markets today: The EGX30 ended Tuesday’s session down 2.8% as indexes across the region fell slumped with the spreading oil crisis. Turnover was 36% above the 90-day trailing average, with EGP 864 mn-worth of shares changing hands during trading. Asian stocks are in the read across the board as we neared dispatch time this morning, though not sharply. Futures point to a mixed open in Europe and show US markets opening tepidly upward.
It’s the 50th annual Earth Day today, and we’re not alone in wondering why we can take action against a pandemic, but not against the destruction of our planet. Earth Day was first marked on 22 April 1970, when mns across the globe took to the streets demanding governments take legislative action against toxic waste, pollution and a commitment to environmental protection, according to the United Nations. Earthday.org will be hosting live panel discussions and performances all day to help mark the event and provide concrete steps to take for more sustainable living.
COVID-19 IN EGYPT-
Egypt now has 3,490 confirmed cases of covid-19 after the Health Ministry reported 157 new infections yesterday. The ministry also said that another 14 people had died from the virus, taking the death toll to 264. We now have a total of 1,181 confirmed cases that have since tested negative for the virus after being hospitalized or isolated, of whom 870 have fully recovered.
EgyptAir may be about to get an EGP 2-3 bn bailout to help shield the national flag carrier from the economic impact of covid-19, Al Masdar reports, citing unnamed government officials. The funding could take the form of a loan at a preferential interest rate of 8%, the site claims.
Domestic private airlines have also asked for government support and are waiting for news on hints that a package of measures might be in the works. In the meantime, private operators are switching to cargo to help offset their losses after passenger planes were grounded last month, according to Al Mal. The airlines are awaiting approvals from the Egyptian Civil Aviation Authority and aircraft manufacturers to repurpose their aircraft to haul goods. The International Air Transport Association had warned that Egypt’s airlines could lose as much as USD 1.6 bn in revenues, threatening up to 205k direct and indirect industry jobs in Egypt.
NBE, Banque Misr want the EBRD to help shore up liquidity: The National Bank of Egypt and Banque Misr have submitted requests for credit from the European Bank for Reconstruction and Development (EBRD) to help shore up their liquidity positions, Al Mal reported yesterday, citing informed sources. The two state-owned banks want to access the development bank’s EUR 1 bn relief fund which would allow them to access up to EUR 100 mn each in emergency funds.
[CORRECTION- 23 April: An earlier version of this story incorrectly said the EBRD’s relief fund holds EUR 1 tn]
South African insurance company Sanlam has pressed pause on plans to expand into Egypt following sales slumps in African markets, according to AfricaReport. The company will be focused on maintaining current clients for the time being but Egypt, along with Ethiopia, remain “countries of interest,” said Sanalam’s CEO Heinie Werth.
Egypt’s electricity interconnection project with Saudi Arabia is on hold for now, with the Egyptian Electricity Transmission Company postponing for 60 days a tender for the construction of the interconnection power line, which was originally expected to be signed in May, Afrik 21 reports, without citing a source.
Prime Minister Mostafa Madbouly is fast-tracking the release of overdue payments to contractors to help them pay their workers and spur construction work on national projects, according to a cabinet statement.
- PepsiCo has donated USD 1 mn to provide 2 mn meals for day laborers impacted by covid-19 measures. (Statement, pdf)
- The Armed Forces have donated EGP 100 mn to the Tahya Misr Fund. (Statement)
- Novartis Egypt is donating EGP 6.5 mn for personal protective equipment and will help the Health Ministry acquire PCR test kits. (local press).
- Hyde Park Developments donated 2k covid-19 antibody test kits to a number of hospitals. (Hapi Journal).
- Uber and AXA Egypt will provide 20k trips and meals without charge to healthcare workers. (Press release, pdf).
ON THE GLOBAL FRONT-
There are now more than 230k cases of covid-19 in the Middle East, the Jerusalem Post reports. Turkey is the region’s worst affected country with over 90k recorded cases, followed by Iran with nearly 85k confirmed cases. The next worst-hit country is Israel with more than 13k cases, followed by Saudi Arabia with more than 10k cases, and the UAE with almost 7.5k.
Countries are struggling to keep an accurate count of the dead: At least 25k people in 11 countries have probably died of covid-19 without being included in the official count of deaths, the New York Times reports. Deaths related to the novel coronavirus as of 10 April were 41% higher in England and Wales than official figures provided by the government, Sky News suggests, just days after the total count in New York soard when “thousands of deaths that previously went uncounted were added to the city’s statistics,” Politico notes.
Agriculture and food ministers from G20 countries pledged to avoid disrupting food supply chains amid the pandemic, saying they would not enact measures that would drive food price volatility, Reuters reported.
The UK will also begin testing a covid-19 vaccine tomorrow, Health Secretary Matt Hancock said, according to Bloomberg.
New data lays bare corona’s impact on the global airline industry: Capacity on international flights has collapsed to just half a mn seats a week, a 90% plunge from an average 5.9 mn prior to covid-19, according to OAG Aviation Worldwide. Total capacity (accounting for domestic flights) has plunged by 70% to 29.8 mn and could fall still further next week as carriers continue to cut back, the travel data firm said.
Italy will begin easing its lockdown restrictions on 4 May, with Prime Minister Giuseppe Conte expected to announce later this week how the government will go about loosening controls on business and movement imposed in March, according to Reuters.
The list of delayed and cancelled events now stretches into fall:
- A one-year delay of Dubai Expo 2020 will be put to a vote at the Bureau International des Expositions. (Bloomberg)
- Germany has officially canceled this year’s Oktoberfest, which was set to begin on 19 September. (Deutsche Welle)
- Spain is canceling its iconic running of the bulls, also known as the festival of San Fermin. (The Guardian)
^^Get a load of that oil VIX: As this analyst pointed out on Twitter, 30-day volatility in the oil market usually fluctuates around the 30 pt handle. Yesterday it hit 1,100. Yes, you read that correctly.
Oil prices took another hit yesterday, with WTI June futures dropping 43% to USD 11.57 / bbl after holding above USD 20 / bbl even when oil contracts for May delivery fell into negative territory. The fall in June contracts indicates “the blowout in the May contract was more than just a technical blip,” the Financial Times says. Brent crude, the international benchmark, also tumbled yesterday, ending the day down 24% to USD 19.33 / bbl.
SOMETHING GOOD OUT OF COVID? If there’s one phrase we now despise, it’s “We’re all in this together.” Sure. But at least that means that the “influencer economy” is facing its first recession, too, the good people at Wired write.
*** It’s Hardhat day — your weekly briefing of all things infrastructure in Egypt: Enterprise’s industry vertical focuses each Wednesday on infrastructure, covering everything from energy, water, transportation, urban development and even social infrastructure such as health and education.
In today’s issue: The cement industry looks set for another hard year in 2020, with many of the problems of the previous years festering and covid-19 weakening demand. And while all the players want government action to rescue the sector, opinions are divided over which direction to take, with some wanting it to address the oversupply problem directly, and others advocating export quotas and even price controls.