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Sunday, 31 January 2021

What we’re tracking on 31 January 2021

Good morning, everyone, and welcome to a new workweek — and the last day of January. As we look to February, our thoughts turn to an expanded vaccine rollout, to spring weather — and the prospect that we may all be able to travel again. We’re … cautiously optimistic, to borrow a (really overused) phrase from business that really means, “We’re hopeful, and please don’t smite me with lightning for feeling that way.”

It’s interest rate week: The CBE meets on Thursday, 4 February for its first review of 2021. Eleven of 12 economists and analysts we polled expect rates to be left on hold, as we report below.

Tomorrow is a brand new month- Here are the key data releases over the next two weeks:

  • Purchasing managers’ index: January PMI data for Egypt, Saudi Arabia and the UAE will land on Wednesday, 3 February.
  • Foreign reserves figures for January should drop towards the end of this week.
  • Inflation figures for January will be released on 10 February.

Ten cabinet ministers will present to MPs their policy priorities this week as the House of Representatives enters its third week of ministerial briefings. Sixteen of 30 ministers have spoken so far, and rumbles of a cabinet shuffle have quieted in the past week. What does this week’s schedule look like?

  • Sunday: Transport, Petroleum
  • Monday: Finance, Social Solidarity
  • Tuesday: Justice, Trade and Industry
  • Wednesday: Electricity, Housing and New Communities
  • Thursday: Tourism, Health

Expect an announcement today on whether the deadline for businesses to file wage tax returns is being extended until the end of February amid pressure on the electronic filing system, the local press reports, citing unnamed Finance Ministry sources. Today’s deadline applies to businesses, includes separate filings for the first and second halves of the year and will require sole traders or folks who generate income from outside of their day job to file electronically for the first time. Taxpayers who use the electronic filing and payment system will pay an annual fee of EGP 325, the Finance Ministry said in a decree published last week.

Is Putin (and an end to the flight ban) due in town in March? Russian President Vladimir Putin is reportedly due to visit Egypt sometime around March, at which time we could see a “final” resolution to the five-year ban Russia has in place on direct flights to Red Sea destinations, Al Shorouk reports, citing unnamed tourism industry sources. Russian officials were in Hurghada last week to inspect the airport’s security measures, and are reportedly sticking around until Wednesday. Meanwhile, Moscow is resuming regular flights to Cairo as of next Monday.

Egypt will head up an emergency ministerial Arab League meeting on 8 February to discuss the Israel-Palestine peace process. Foreign Minister Sameh Shoukry has held high-level talks with French, German, EU and Jordanian officials in recent weeks, suggesting that there may be renewed political will to push the two sides back to the negotiating table and resume peace talks.

Egyptian boardrooms were only slightly more diverse by the middle of last year: Egyptian companies made lackluster progress bringing more women onto their boards in the first seven months of 2020, according to the American University in Cairo’s 2020 Board Diversity Index (pdf) which found that the number of board seats at EGX-listed companies held by women increased only 0.7% from the end of 2019 to 31 July 2020. According to the index, which also tracks the number of women in chair and executive positions, a little over half (53%) of all publicly listed businesses had at least one woman on their boards last year, a slight increase from 47% in 2019. Women also account for only 3.9% of CEOs and managing directors, 8.7% of COOs, and 2.1% of CFOs on EGX-listed boards.

Just under half of EGX30 companies had zero women on their boards when we ran our last check at the end of last year.


THE BIG STORY INTERNATIONALLY this morning: Global stocks fell the most since October on Friday as retail investors caused chaos and concerns over the global vaccine rollout increased. The S&P 500 dipped into the red for the year after the index fell almost 2%, capping its worst week since October, while indexes in Europe were firmly in the red. The EGX30 missed the party as it was off for a three-day weekend.

What’s up with covid? Vaccine programs in several parts of the world aren’t going so great right now, and the EU and US have both turned to protectionism to try and maintain supply. Then there were several manufacturers casting doubt on their abilities to provide adequate protection against new strains of the virus. We have more on both of these in this morning’s Covid Watch, below.

Then there was the horde of Reddit traders determined to meme the titans of Wall Street into bankruptcy. What began as just another short-sell for Melvin Capital quickly turned into a matter of life or death as thousands of retail traders left it nursing a 30% loss and in need of a USD 2.75 bn bailout. In the space of two weeks, lossmaking videogame retailer GameStop’s share price surged more than 1,000% as r/wallstreetbets pulled off one of the most remarkable grassroots short squeezes in history, leaving some of the street’s biggest players on the wrong side of the trade, brokerages searching for liquidity, and concerns over market volatility. Bloomberg and the FT have more on last week’s market moves. CNBC has a day-by-day recap.

Want to go deeper? Read the FT’s piece ‘This is the way’: the Reddit traders who took on Wall Street’s elite and meet Deep[Redacted]Value in this Reuters piece.


If you haven’t already heard — we’re no longer competing in the handball world cup: Egypt suffered a gut-wrenching defeat at the hands of Denmark, after playing the reigning world champions to a draw in a quarter-final game on Wednesday. The Pharaohs showed class and were a goal up until the last second of double-extra time, which was when the European side netted a penalty and decided the game on tie-breaker penalty throws. Egyptian left back Ali Zein was named man of the match.

Denmark and Sweden will face off in an all-European final tonight at 6:30 pm CLT. Spain and France will meet in the play-off for the bronze medal at 3:30 pm CLT.


FURTHER AFIELD-

Some foreigners could be made Emirati citizens: Foreign investors, doctors, scientists, and other “special talents” are now eligible for Emirati citizenship under new rules, according to UAE news agency Wam. The citizenship could be granted to individuals based on nominations from the UAE cabinet, local courts, and executive councils, provided they meet other requirements.

FROM THE DEPT. OF AWESOME NEWS- Renewables overtook fossil fuels as Europe’s primary source of energy last year.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.