TONIGHT: Global stocks are in the toilet + the Ever Given is steaming toward the Suez Canal
Well, folks, that’s workweek #33 of 2021 in the books for those of us here in Egypt and elsewhere in the Arab world. We hope it treated you well — and that you’re heading for the beach right now (if summer hasn’t already come to an end for you as the kids return to school).
THE BIG STORY TODAY- Global stocks are in the 🚽this afternoon, with major European indexes across the continent down all down 2% or more. The EGX30 followed suit, closing today down 0.9% and erasing its gains for the year. The benchmark index is now 0.3% in the red YTD. Look for Wall Street and Bay Street to open sharply lower later this afternoon, if futures are any indication.
What’s going on? Investors are leery about the US Federal Reserve’s plan to begin tapering later this year — and they’re also getting skittish about the potential impact on global growth of the rapidly spreading delta variant of the virus that causes covid-19. The story leads the front pages of the Financial Times and CNBC and is getting prominent play in the Wall Street Journal, which adds that oil is also on the slide.
SAY IT ISN’T SO- Battlestations, battlestations — the Ever Given is heading for the Suez Canal, according to shipping monitor Marine Traffic. In case you were living under a rock back in March, the Panama-flagged ship became lodged in the Suez Canal for nearly a week, disrupting some 10-15% of global trade. It was then held pending negotiations over compensation, before finally being released on 7 July. Owner Shoei Kisen reportedly paid out USD 540 mn in compensation to the Suez Canal Authority.
The good people at GASC need to be working on their market forecasts as Russia looks set to cut back further on wheat exports. Russia has traditionally been our top provider of wheat (just as we’ve traditionally been the largest wheat importer in the world), but Moscow is selling less and less. Today, Russian has fulfilled just 20% of all wheat contracts Egypt has filled, the lowest level in seven seasons, according to Bloomberg data. What gives? Putin is keeping more and more of it home in a bid to keep a lid on inflation — and Russia seems to be on track for an anemic crop this year.
Turkey is really poking around in our neighborhood once more. This time, Mr. Erdogan is banging on about the need for a peaceful solution of Ethiopia’s war in Tigray — and separately offering to mediate on the Sudan-Ethiopia border dispute. The move comes after Erdogan met with UAE national security advisor Sheikh Tahnoun bin Zayed Al Nahyan in what Bloomberg called “the clearest sign yet that the regional foes are ready to turn the page.”
** CATCH UP QUICK on the top stories from today’s EnterpriseAM:
- Swvl is looking to expand into Europe by acquiring Shotl, an on-demand bus platform covering 22 cities in 10 countries. We have an update on the story in today’s Speed Round.
- The Sovereign Sukuk Act is now the law of the land after President Abdel Fattah El Sisi signed off on the bill. It opens the door for Egypt’s first sovereign sukuk issuance.
- The NTRA has adopted a data center and cloud computing regulatory framework as Egypt pushes ahead with plans to become a heavyweight in the data center industry.
THE BIG STORY ABROAD- It’s still Afghanistan, where protests against Taliban rule have spread to more cities — and protesters were again killed, this time in Asadabad as Taliban forces fired into crowds.
Afghanistan is likely to suffer higher food prices and capital controls, with its people facing “dire” financial prospects after the Taliban poured earlier this week into Kabul and other major cities across the country, former acting central bank governor Ajmal Ahmady tells the Financial Times. “We’ve finished the military phase and now we’re going to start the economic phase of the impact,” Ahmady, who fled the country last weekend, said. US President Joe Biden, whose administration had frozen the Taliban’s access to Afghan government reserves in US banks, stressed that chaos in Afghanistan was unavoidable as troops withdrew, saying that “the idea that somehow, there’s a way to have gotten out without chaos ensuing, I don’t know how that happens,” in an interview with ABC News, Bloomberg reported.
SIGN OF THE TIMES- Toyota slashes production thanks to covid and global chip shortage: Toyota Motors announced (pdf) this morning that it was making “adjustments” to its production cycle in August and September, suspending production in 27 out of 28 production lines in 15 plants in Japan. This announcement comes a few days after the company reported cases of covid-19 at its plants and comes amid reports picked up by Reuters that Toyota was looking to cut global production by 40% next month on account of the global chip shortage.
Could this impact the availability of Toyota models in Egypt? That is still unclear, as representatives of the company had no comment to give us as of dispatch time. That said, the Egyptian Association of Automobile Manufacturers had been complaining in the local press back in May that major car manufacturers have been forced to slash production due to the global chip shortage. Industry analysts at the time had been projecting the local impact of this shortage will be felt all the way until 2022.
Domestic heavyweight GB Auto reported that the semiconductor shortage had constrained its growth in what was otherwise a very strong second quarter for the company (pdf).
🚙 FOR YOUR COMMUTE-
YOUR MANDATORY COVID STORY- The delta variant continues to put paid to hopes that we’ll see the back of covid anytime soon. A study published today in a preprint by Oxford University and the UK’s Office for National Statistics has concluded that covid-19 vaccines are less effective at protecting against delta than other variants, Bloomberg reports. With over 3 mn PCR tests analyzed to map infection patterns, vaccinated people infected with the delta variant were found to have similar levels of virus in their bodies as unvaccinated people. This backs up evidence that delta is more transmissible than other covid-19 variants — even in vaccinated people.
But the unvaccinated are still judged to be most at risk: The study is clear that vaccines remain the best protection against covid-19. Around 4.5 months after the second dose, the Pfizer and AstraZeneca shots offer roughly similar protection against preventing infections with a high viral load. It may be further evidence to support mixing the Pfizer and AstraZeneca vaccines, which use different technologies, according to the study.
But the results represent another blow to the idea of achieving herd immunity, showing that “unvaccinated people are just going to be at higher risk,” one Oxford professor said.
Meanwhile, the US is pushing for booster shots next month: As countries with ample vaccine supplies face concerns over new waves of infections, plans to administer booster shots are drawing criticism of vaccine hoarding. The Biden administration is planning to start offering a third dose of vaccines in the US next month, after scientists warned of the risk of new cases related to the delta variant, the Financial Times reports.
Over in the UAE, waste incineration is on the rise now that other countries — notably China — have stopped importing trash, Bloomberg tells us. With the construction of a new USD 1.1 bn waste-to-energy plant, soon the UAE may incinerate almost two-thirds of the household waste it currently produces. While there are strong reasons for investing in WtE — namely, that it produces energy — it will also impact the UAE’s attempts to phase out carbon emissions by 2050.
REFRESHER- Here in Egypt, WtE is struggling as a sector to get off the ground, as private sector players bemoan a low feed-in tariff, an electricity supply glut, and a lack of competitiveness with solar and renewables. We dive deeper into those problems in our last Going Green feature, which you can check out here.
Speaking of recycling gone bad: Go read Dead white man’s clothes on ABC Australia’s website on how tons and tons of recycled clothing donated to charity wing up in landfills in Africa. About 15 mn used pieces of clothing pour into Accra alone every week from Europe, the US, Canada and Australia. 40% of it is of such poor quality to goes straight to the dump. You can blame fast-fashion brands including H&M, Zara and Boohoo, which are doing up to 52 micro collections a year of low-quality clothing rather than four, longer-lasting seasons a year.
If America has a diabetes problem, what about us here in Egypt? At least 10% of Americans (pdf) have type-2 diabetes — a figure that rises to nearly 16% here. And covid is making the situation even worse: Diabetics and other folks with disordered metabolism have much higher risk of becoming very sick or dying of covid-19. And the pandemic has made it even more difficult for diabetics to get help managing the disease. Go read How the pandemic laid bare America’s diabetes crisis and then maybe go here and read about how diabetics can put their disease in remission by cutting carbs from their diet. Want to go even deeper? Try Nina Teicholz’s The Big Fat Surprise or Dr. Jason Fung’s The Diabetes Code.
📺 ON THE TUBE TONIGHT-
Ending our sports documentaries week on a high note: State of Play is an ingenious documentary that explores human psychology and societal dynamics through sports. Each episode revolves around a different theme, opening with a brief overview, followed by a verite documentary and finally a roundtable discussion from experts. Our favorite episode is S1E4: Game of Borders which shows the life or death stakes the Palestinian national football team has to overcome to keep playing. Otherwise, other great episodes include S1E1: Trophy Kids where the pressure that parents put on their children to be athletes is explores, S1E2: Inherent Violence that looks at violence in sports, and S2E3 which follows the US’s NFL as they disclose the toll the highly physical game has had on players and try and make the sport safer. You can find State of Play on OSN Streaming.
⚽It’s a slow, slow weekend for football fans, with hardly a worthy game in sight until Saturday.
In the Premier League, we’ve got Liverpool versus Burnley at 1:30pm, Aston Villa versus Newcastle United, Crystal Palace versus Brentford, Leeds United versus Everton, and Manchester City versus Norwich City all at 4pm. Finally, Brighton & Hove Albion versus Watford is kicking off at 6:30pm.
Kicking off Serie A, we have Hellas Verona versus Sassuolo and Internazionale versus Genoa at 6:30pm followed by Empoli versus Lazio and Torino versus Atalanta at 8:45pm. All times given are CLT.
🏈 And so we’re forced to go to that other ‘football’: And with not even tennis to watch (the US Open doesn’t kick off until 30 August), you’re going to have to settle for preseason NFL games if ‘Murican fooball is your thing. In the second week of preseason play, the Patriots take on the Eagles at 1:30am tonight (well, technically, tomorrow morning) in a Super Bowl rematch. The Pats are 1-0 after beating the Washington Football Team (they still haven’t decided on a new name), and the game will the the Eagles’ first.
Tomorrow: Said Washington Football Team takes on the Tennessee Titans (go Titans, if only because on of our brothers-in-law root for them) and the Bills take on the Lions. There are no fewer than 10 games to watch on Saturday and then two more on Sunday. Check out the full schedule here.
🥐EAT THIS TONIGHT-
Whether you’re heading back to Sahel or staying in Cairo, Fish Chips & Dips brings London’s favorite snack to Umm El Donia, plus a few Egyptian-ized fish dishes. If you’re a seafood lover, this is the place for you. Think fish anything and everything from the namesake dish fish & chips to seafood rolls, burgers, nachos salads, and pastas. We recommend you opt for the classic fish & chips, salmon burger, shrimp nachos, or seafood pasta. Also not to be missed is their taiyaki ice cream that is in a cake-like cone shaped like a fish and loaded with chocolate, Lotus, or another delicious sweet addition. You can find the seafood-obsessed joint at Sheikh Zayed’s Walk of Cairo or North Coast’s M Beach Club at Marina 5.
🎤 OUT AND ABOUT-
Music-wise, both branches of Cairo Jazz are serving up some funk and boogie this weekend. Cairo Jazz Club in Agouza is spinning soul and funk, after an opening acoustic set from singer Shady Ahmed. And tomorrow, Cairo Jazz 610 in Sheikh Zayed is holding the fantastically-named Boogie Night in Outer Space. Both events run until 1am, and reservations can be made through a Facebook message.
On Saturday, Cairo Opera House is holding a musical tribute to Youssef Chahine, starting at 8pm. Tickets are available online through the Facebook page, or can be purchased directly through the opera house.
💡 UNDER THE LAMPLIGHT-
100 Tricks to Appear Smart in Meetings is a great book to have lying around the office. The illustrated book is hilarious and will keep you wanting to read more, but at the same time also offers pretty good advice if we do say so ourselves. Sarah Cooper offers insights on what your resting face is communicating to others, how to seem intelligent (by repeating after the soft spoken engineer), and how to impress others. What makes the book great is that she’s often spot on about the weird and random thoughts that revolve in our heads as we attempt even the most miniscule change in tone or demeanor. Seeing it all laid out and expressed gives an idea of how we appear to others and how we’re all pretty similar in our approaches to being “the cool guy” at meetings.
☀️ TOMORROW’S WEATHER-
Surprise, surprise. It’s still pretty hot. We should expect the mercury to stay solidly around 40°C for much of the day in Cairo, although we’ll see some respite later, with a nighttime low of 25°C, our favorite weather app tells us. Sahel will remain cooler, with a daytime high of 33°C and overnight low of 24°C.