It’s been an atypically busy Sunday, with some good news coming out of the state privatization program, the Finance Ministry and the central bank. But since it is Halloween, we will start with something scaring fund managers here…

WATCH THIS SPACE- The capital gains tax (CGT) is getting its day in the House of Representatives, where Finance Minister Mohamed Maait is discussing the ramifications of reintroducing the tithe, Al Borsa reports. Representatives from GAFI, the bourse, and the Financial Regulatory Authority are also attending the debate, which MPs had formally requested earlier this month. The 10% tithe on gains from EGX transactions is expected to come into effect on 1 January 2022, Maait confirmed last month, but has been met with resistance from fund managers, figures in the securities industry, and MPs alike. The CGT has been in the pipeline since 2015 but has since been postponed several times, including last year, when it was pushed due to the pandemic.

THE BIG STORIES TODAY-

PRIVATIZATION WATCH- Misr Ins. Holding has signed on for EGP 15 mn worth of shares in Ghazl El Mahalla FC’s IPO, out of a total EGP 37 mn worth of shares that will be allocated for private placement, Public Enterprises Minister Hisham Tawfik told Hapi Journal. The remaining EGP 22 mn worth of shares will be marketed to institutional investors. The private placement portion of the sale is set to go through in November, the minister said, with the public portion of the club's IPO now set to hit the market in December, after having earlier been slated for November.

The sale is expected to raise EGP 135 mn, which would be done via newly-issued shares that would see up to two-thirds of the club listed on the exchange. Another EGP 98 mn will be earmarked for sale to individual retail investors, Prime Holding CEO Mohamed Maher — whose firm is quarterbacking the debut— had told us over the summer.

On to the Finance Ministry, which said in a statement that tourists shopping in Egypt will soon be able to claim VAT refunds via a digital system. The rollout of the digital system, which will eventually be available at all of Egypt’s airports, seaports, and border stations, is set to begin before the end of the year in Sharm El Sheikh.

Saudi Arabia has reportedly deposited an additional USD 3 bn in the central bank, as well as extending the tenor of its current deposits worth 2.3 bn, in a move that should shore up our foreign currency liquidity, sources told Bloomberg Asharq. We’re reaching out to the CBE for confirmation.

^^ We’ll have more on these stories and more in tomorrow’s edition of EnterpriseAM.

HAPPENING NOW- President Abdel Fattah El Sisi and Environment Minister Yasmine Fouad are in Glasgow today as COP26 gets underway. The summit, which will run until November 12, will make climate change the top story for the next several days as politicians attempt to reach an agreement on steps to reduce emissions and slow down global warming.

El Sisi is set to meet with UK Prime Minister Boris Johnson on the sidelines of the summit, the Ittihadiya statement notes. Egypt is set to host next year’s COP27 in Sharm El Sheikh. The president will also meet with other unnamed leaders and politicians in Glasgow to discuss cooperation, as well as regional and international issues.

On that front, no climate breakthrough among G20 nations ahead of COP26: After a tough night of negotiations in Rome, the climate agreement between G20 nations had to be watered down to get everyone to sign off, making it largely unchanged from the 2015 Paris accords, Bloomberg reported after seeing a copy of the document. The failure to arrive at tonight’s COP26 opening with a more ambitious commitment will disappoint climate scientists and activists, and could derail the sumit’s chances of success, according to Reuters.

The latest country to announce a green target ahead of today’s COP26 summit: Qatar, which said it is aiming to reduce greenhouse gas emissions by 25% by 2030 in a national climate change action plan launched today, according to Reuters. The plan will also see the Gulf country reduce the “carbon intensity” of its liquefied natural gas (LNG) facilities by 25% by the same year by intensifying carbon capture and storage. Qatar is the world’s largest producer of LNG with plans to expand production to 127 mn tonnes annually by 2027.

KUDOS- Souad is Egypt’s Oscars pick: Egyptian director Ayten Amin’s film Souad, which received glowing reviews when it hit international screens this year, has been chosen as Egypt’s submission for Best Foreign Language Film at next year’s Academy Awards. The committee will review all submissions before choosing the five films to be nominated, with the winner announced at the Oscars ceremony next March. Don’t hold your breath: no Egyptian film has ever made it to the nominees shortlist, though there are definitely some gems to add to your watchlist among the Egyptian submissions down the years.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

• CBE leaves rates unchanged: The Central Bank of Egypt’s Monetary Policy #2 Committee left interest rates on hold for the eighth consecutive meeting on Thursday, citing a slowdown in global economic activity and expectations that international financial conditions will remain accommodative in the medium term.
• Higher utility bills coming for factories: The government hiked natural gas prices for industry by up to 28%, more or less reversing price cuts enacted last year to help industrial producers withstand the covid-19 crisis.
• Bread subsidy cuts coming … eventually: The price of subsidized bread will likely be increased as global wheat prices rise, but the Supply Ministry is still working on a framework for the subsidy cuts that will “take time” to enact.

THE BIG STORY ABROAD-

Exit polls are predicting Japanese PM Fumio Kishida's ruling coalition to stay in power following today’s parliamentary elections, Reuters reports. That said, the PM’s Liberal Democratic Party (LDP) is expected to lose seats after receiving criticism over its handling of the pandemic. Kishida called the elections last month in an attempt to consolidate his mandate soon after taking over leadership from his predecessor Yoshihide Suga, but the anticipated lackluster result could see the world’s third-largest economy return to political uncertainty.

FOR TOMORROW-

Tomorrow’s the start of a new month. Here are dates for some key news triggers as we enter November:

• PMI: November’s purchasing managers’ indexes for Egypt, Saudi Arabia and the UAE will land on Wednesday, November 3.
• Foreign reserves: October’s foreign reserves figures will be out sometime during the first week of November.
• Inflation: Inflation figures for October will be released on Wednesday, 10 November.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

???? CIRCLE YOUR CALENDAR-

Will the Fed announce a taper this week? All eyes are on the Fed ahead of its two day meeting on 2-3 November, in which it is widely expected to announce the winding down of its USD 120 bn a month asset purchase program instituted at the start of the pandemic to stimulate the economy. Fed head Jerome Powell had previously said the central bank could begin to taper off its program in November, while policymakers signalled that they could move to raise interest rates next year. Rising US rates could spell challenges for emerging market assets — including Egypt’s — as investors are tempted to sell-down riskier assets in favor of higher-yielding US treasuries.

We could soon find out this week which commodities will be traded on Egypt’s long awaited commodities exchange when it launches early next year. Supply Minister Ali El Moselhy told Al Borsa last week that we should expect an announcement following a meeting set for this coming week with EGX boss Mohamed Farid and head of the Internal Trade Development Authority Ibrahim Ashmawy.

☀️WEATHER UPDATE-

There’s a medium chance of rain later today in Greater Cairo, while coastal cities could experience thunderstorms tonight, the Egyptian Meteorological Authority forecasts.

TOMORROW’S WEATHER- The mercury is still too high in our opinion, with an expected afternoon high of 31°C tomorrow which will fall to 20°C at night, according to our favorite weather app.