Good morning, wonderful people, and welcome back to what’s shaping up to be a very busy workweek as we digest the Fed’s rate hike, look to hear what’s next with the state privatization program, and continue to grapple with the many-faceted fallout from the war in Ukraine.

Need a refresher on what the big issues of the day were before we all went on break? We’ve got you covered here.

THE BIG STORIES HERE AT HOME all center on containing fallout from the war in Ukraine, including expectations that the privatization program could restart in September (market conditions permitting), new measures to boost foreign investment and domestic industry, and speculation in the domestic press and on the airwaves about whether the Central Bank of Egypt could raise interest rates earlier than planned after the Fed’s 50 bps move last week.

^^ We have more on all of this below in this morning’s news well and in Last Night’s Talk Shows.

THE BIG STORIES ABROAD- There’s no single story dominating the global front pages this morning:

• Putin reportedly plans to send a “doomsday” warning to the West at tomorrow’s World War II victory parade in Moscow.
• Soaring oil and gas profits ≠ soaring investment: Bloomberg leads with a story reporting that oil majors are deploying their “historic” profits on share buybacks, rather than making productive investments.
• The Kushner connection: Mns of USD of Saudi money is finding its way to Israel via Jared Kushner’s new private equity firm, according to the Wall Street Journal.

WATCH THIS SPACE- Folks on Planet Startup in the United States are getting really edgy about a “bloodbath” of layoffs, spending cutbacks, down rounds (and cram-downs) and a slowdown in fundraising by VCs — a trend that has gathered steam since we flagged it for you last Thursday:

• Facebook parent company Meta has imposed a hiring freeze (which means head count will shrink as people leave), blaming in part Apple’s privacy rules, which it says are eating into revenues.
• Once-hot celebrity video app Cameo has dumped 90 people, including its CTO and heads of people, product and marketing.
• On Deck has cut 25% of its headcount.
• Some LPs are slowing down (or pulling back) on commitments to new venture capital funds, suggesting the spigot may be tightening, meaning cash will once again be king
• More than 20% of the companies in Nasdaq’s biotech index are trading a valuations less than the cash they hold

Oh, and the NFT market? It has cratered. Sales of NFTs are down about 92% since their peak last September, the Wall Street Journal writes, and active wallets are down 88%. It’s not just the dude who bought Jack’s first tweet who’s underwater right now…

WHAT’S HAPPENING TODAY-

IT’S PMI DAY: We’ll find out how Egypt’s private sector performed in April today after the latest purchasing managers’ index lands just after we hit “send” on this morning’s issue (you should find it here by 6:15am CLT). Non-oil private sector activity has been in contraction for 16 consecutive months, and suffered its steepest decline since June 2020 in March as Russia’s war in Ukraine and rising inflation hit business.

Elsewhere in the region: PMI figures for Saudi Arabia and the UAE will be out tomorrow, while data from Qatar will land Tuesday.

PSA #1- We love you, Mom. Happy Mothers’ Day to all those celebrating the date in the United States and Canada today.

PSA #2- Today is the last chance to file corporate taxes. The Tax Authority pushed the original 30 April deadline to account for the weeklong Eid break.

PSA #3- Mosques are officially post-covid as of today: All mosques and shrines will fully reopen from today after more than two years of disruptions caused by covid-related restrictions on public gatherings, the Awqaf Ministry announced in a statement.

Speaking of covid- Egypt saw an average of eight new covid-19 cases per day last week, down from 46 the week before, according to Health Ministry figures released yesterday. We also saw a daily average of four deaths, down from five a week earlier. Around 34.5 mn people are now fully vaccinated and almost 2.7 mn have had their boosters, the statement added.

HAPPENING TOMORROW-

One step closer to our 2022-2023 budget: Finance Minister Mohamed Maait will present the draft FY 2022-2023 budget to the House of Representatives’ general assembly tomorrow. Last month the House voted to send the draft FY 2022-2023 budget to the budget and planning committee. Planning Minister Hala El Said will present the draft economic and social development plan to the House during the same session.

Brazil wants to buy more Egyptian fertilizer: Officials from Brazil’s agriculture ministry will arrive in Cairo tomorrow to discuss upping nitrogen fertilizer imports from Egypt, the Arab Brazilian Chamber of Commerce said Thursday. The delegation will meet with Supply Minister Ali El Moselhy, Deputy Agriculture Minister Moustafa El Sayed, and private sector fertilizer and animal protein suppliers.

Why the “fertilizer diplomacy”? The South American country imports around 85% of its fertilizers and is in search of new suppliers as sanctions on Russia — the largest producer of nitrogen fertilizers last year (pdf) — raise concerns of a supply shortage.

LATER THIS WEEK-

We’re back from holiday with a ton of data points and news triggers in the pipeline. Here are the key events you’ll want to keep an eye on:

• Privatization strategy announcement: We’re expecting the Madbouly government to announce the details of its strategy to privatize state-owned firms and boost private-sector participation in the economy. Cabinet said yesterday that the PM will hold a presser this week to announce new measures to improve private investment and FDI;
• Foreign reserves: Figures for April should be announced sometime this week;
• State statistics agency Capmas’ monthly bulletin covering the price of key building materials is due out tomorrow, 9 May;
• Inflation figures for April are due out on Tuesday, 10 May. Between the global environment, knock-on effects from the devaluation of the EGP, and the traditional inflationary hit thanks to Ramadan, you can expect the number to be a bit on the ugly side.

PLUS- The PSA world squash championships get underway in Cairo this Friday, 13 May. The men’s and women’s finals will be played on 22 May. There is USD 550k at stake for each of the men’s and women’s championships, making this the biggest purse on record for a squash tourney.

FURTHER AFIELD-

A huge US “GreenTech business mission” is inbound next week. More than 40 US companies are heading to Egypt to kick the tires on green investment and potential business partnerships in sectors ranging from energy to healthcare, agriculture, aviation, construction and water resource management. The high-level delegation will meet with members of the business community and senior government officials. It’s being led by David Thorne (a top official in the office of the US special presidential envoy for climate) and Jake Levine (chief climate officer at the US International Development Finance Corporation).

ALSO-

• The Central Bank of Egypt will meet to review interest rates on Thursday, 19 May.
• The last of this season’s earnings releases will drop by 31 May after the Financial Regulatory Authority granted listed companies a two-week deadline extension.

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

FACT CHECK- The local gold market is operating as usual: Reports circulating on social media of a pause in gold trading are untrue, the Federation of Egyptian Industries’ precious metals division and the gold jewelry division of the Cairo Chambers of Commerce said in a joint statement. Egyptian gold prices are set transparently and fluctuate according to global prices and local supply and demand, the statement said.

MARKET WATCH- OPEC+ has agreed to another modest production increase of 432k barrels per day in June, as expected, despite continued pressure to raise production levels amid a planned EU embargo on Russian oil and weaker demand from China due to ongoing lockdowns, the group announced in a statement Thursday. The European Union proposed a six-month phase out of Russian crude imports last week. OPEC+ will hold its next meeting on June 2.

*** It’s What’s Next day: We have our weekly deep-dive into what makes and shapes pre-listed companies and startups in Egypt, the UAE and KSA, touching on investment trends, future sector insights and growth journeys.

In today’s issue: We ask leading startup founders what they think of in-the-works regulatory changes designed to attract VC firms to invest directly in Egypt. They all share positivity over the move, which will see the General Authority for Investment and Freezones (GAFI), the Financial Regulatory Authority (FRA) and the Information Technology Industry Development Agency (ITIDA) work together to outline easier operation and access for both local and international VCs in invest in local startups. The protocol not only shows that policymakers are aware of obstacles in the country’s entrepreneurial scene, but also helps in increasing FDI and turbocharge entrepreneurism into the country, they tell us.