TONIGHT: Earnings season lands with a thud + travelers still need a hard copy of their QR passport + El Nasr subsidiary signs new agreement for EV component production
It isn’t an altogether slow Sunday, ladies and gentlemen, but it is looking kind of dry when compared to last week’s flurry of news. We have the FRA communicating further on their capital gains tax incentives, updates on our EV plans and the House is working on some laws today. But before we dive into the top stories today…
It’s that time of year: 3Q2021 earnings season here at home is in full swing — and is making its presence known with a torrent of releases out today. We have a rundown in this afternoon’s Go With the Flow, below.
PSA- If you’re traveling outside the country, you may have to still get a hard copy of your QR passport: Make sure to get a paper copy of your QR code-bearing vaccination certificate before you head to the airport, as the QR code available from the Health Ministry’s covid passport app is not yet being accepted as proof of vaccination at Cairo International Airport, according to EgyptAir customer service representatives Enterprise spoke with. In our experience, the paper certificates are straightforward to get from the ministry’s vaccination centers and shouldn’t take too long. We are currently still reaching out to the Civil Aviation Ministry for information on when the app QR passport will be accepted at airports.
THE BIG STORIES TODAY-
#1- POLL- The market is, by and large, reacting positively to the planned EGX incentive package the Madbouly government announced last week. Analysts we’ve spoken to are signaling that the incentives package will be good for the market, but point out that the less-obvious message behind the package is that the capital gains tax is going to be our new reality come January: no ifs, no buts, and no more delays.
FACT CHECK- No, there isn’t an official decision on the exact percentages of cuts to EGX trading costs yet. Local press reports were out today claiming to have the exact percentages of the tax and fee cuts investors would be getting as part of the incentives structure being rolled out with the capital gains tax. A Financial Regulatory Authority (FRA) official we spoke with under condition of anonymity tells us that these were figures suggested by stakeholders and were not necessarily the numbers the FRA plans to make official.
#2- BrightSkies joins state automaker to manufacture EVs domestically: The Engineering Automotive Manufacturing Company, a subsidiary of state-owned El Nasr Automotive, has signed a cooperation agreement with private Egyptian tech firm BrightSkies that will see the two firms manufacture key components for Egypt’s first locally-assembled electric microbuses, according to a Public Enterprise Ministry statement (pdf). The plan is to supply the control systems, power units and engines for the 80% locally sourced microbuses, which are set to be prototyped within a year.
The news comes days after the wheels came off a plan for El Nasr to locally assemble Chinese firm Dongfeng’s E70 electric vehicles. Talks came to a halt due to an import pricing dispute with the automaker—the kind of problem you just don’t have if you can make your own EVs from scratch here at home.
^^ We’ll have more on these stories and more in tomorrow’s edition of EnterpriseAM.
** CATCH UP QUICK on the top stories from today’s EnterpriseAM:
- Egypt officially confirmed as COP27 host: We will be hosting next year’s iteration of the climate summit, which will be held in Sharm El Sheikh in November 2022.
- Banque Misr in line for more EBRD climate financing: The European Bank for Reconstruction and Development could soon sign off on a USD 100 mn facility to the bank to finance local SMEs working on green projects.
- Ora plans USD 1 bn Africa expansion + Sawiris pivots to battery metals: Naguib Sawiris’ Ora Developers is planning to invest at least USD 1 bn over the next five years to increase its footprint in Africa, while Sawiris’ La Mancha gold fund will offload its controlling stake in Canadian miner Golden Star Resources and reinvest the proceeds into metals used to make batteries.
HAPPENING NOW- Foreign Minister Sameh Shoukry is in the UAE to participate in the Sir Bani Yas Forum, according to a cabinet statement. The four-day event is organized by the UAE’s Foreign Ministry and brings together senior decision makers from across the Middle East to discuss issues facing the region, with this year’s edition to focus on peace, security, and stability.
ALSO HAPPENING NOW- A handful of draft laws and proposed amendments are currently up for committee-level discussion at the House of Representatives, according to Al Ahram. Among the bills are a draft bill governing ministerial “slush funds,” which was passed to the House Planning and Budgeting and House Economics committees for discussion. The Madbouly Cabinet had signed off on new regulations for the funds last year, after previously agreeing to channel 15-20% of the funds’ surpluses into state coffers. A new draft law governing licensing rules for hotels and tourism companies the government drafted in September is also on the docket for a joint tourism and civil aviation, local administration, planning and budgeting, and constitutional affairs committee.
THE BIG STORY ABROAD-
The COP26 autopsy has continued into the afternoon in the international press, and the overall tenor is that global leaders talked a big talk on net-zero targets and political urgency at the meeting, but their final pledge left much to be desired.
The fallout from the disappointing final agreement is ongoing: John Kerry insisted that it reflected “a very aggressive increasing of ambition,” while COP26 President Alok Sharma (i.e. the man whose job was to make a success of the summit) placed the blame elsewhere. “China and India will have to explain themselves and what they did to the most climate-vulnerable countries in the world,” he told the BBC, after the two nations fought during negotiations to weaken the language of pledges to phase out coal use.
Did Greta say it best? “The #COP26 is over,” the climate activist said on Twitter. “Here’s a brief summary: Blah, blah, blah. But the real work continues outside these halls. And we will never give up, ever.”
ICYMI: We have chapter and verse on what went down in Glasgow in this morning’s AM, including a first look at what it will mean for us to host the summit’s next iteration in Sharm El Sheikh in 2023.
Starting from tomorrow, auto dealerships will have to comply with new consumer protection rules requiring price stickers to be displayed on vehicles. Companies that could be fined up to EGP 2 mn if they don’t comply with the rules.
ALSO TOMORROW- All unvaccinated public sector workers won’t be allowed into their workplaces. If you still haven’t been jabbed, you’ll be required to take a PCR test every week in order to get access to your place of work. University students will also be unable to access campuses without proof of vaccination.
🗓 CIRCLE YOUR CALENDAR-
Prince Charles and the Duchess of Cornwall will be in Cairo on Thursday and Friday (18-19 November). It’s the heir to the British crown’s first visit here since 2006 — and the first overseas jaunt by a member of the royal family since the pandemic hit. Charles will meet with President Abdel Fattah El Sisi and Al Azhar’s Grand Imam, Ahmed El Tayyeb, among other government officials. Expect climate change to be high on the prince’s agenda given his personal interest in the topic and Egypt’s selection as host of COP27 next year.
The two-day Africa Fintech summit kicks off this Tuesday, 16 November. The summit looks at innovation in the fintech ecosystem, venture capital and other forms of investing, and will also discuss the rise of healthtech.
The International Finance Corporation is hosting an invite-only forum in Cairo on Wednesday with a focus on sustainable finance in Africa. Egyptian speakers include Central Bank of Egypt First Sub-Governor May Abulnaga, the Financial Regulatory Authority’s Sina Hbous and CIB’s Dalia Abdel Kader.
Comesa summit next week in Sharm: Egypt will host the 2021 Common Market for Eastern and Southern Africa (Comesa) summit on 23 November in Sharm El Sheikh.
KfW is launching a call for green projects: Companies and public bodies working on projects related to the green economy transformation will be able to submit proposals to the KfW Development Bank’s Investing for Employment facility, which will see co-financing grants ranging from 1 mn to 10 mn EUR awarded to to each project, the German development bank said in a press release (pdf). The facility will award grants to projects that contribute towards job creation. You can find out more about the facility and the application process here.
Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.
☀️ TOMORROW’S WEATHER- This weekend’s cold front was short-lived as temperatures once again rise to 27°C tomorrow during the day and fall to 17°C at night, our favorite weather app tells us.