THIS MORNING: Madbouly luring US investors to infrastructure + the US is plotting how to normalize ties between Israel and Saudi
The torrent of news continues on this fine (warm) Thursday morning, and we’re loving every second of it.
Speaking of the heat: It looks very much like spring weather came to an end yesterday. The mercury is set to rise steadily from 36°C today in the capital city to 40°C by Sunday and to stay between 38-44°C as far into the future as the weather witches who run our favourite app can see.
THE BIG STORY here at home: The Madbouly is looking to attract foreign investors with major new projects. In a meeting with US and Egyptian CEOs yesterday, Prime Minister Moustafa Madbouly said his government will launch a string of major new projects in the coming months and pledged fresh incentives to draw foreign investors into the country, according to a cabinet statement.
What’s the PM cooking up? Data centers, LNG terminals, telecom towers, oil and gas pipelines, and wind plant upgrades are all in the government’s plans, he said during a virtual meeting of the Egypt-US Business Council.
Energy is a high priority for Egypt, Madbouly said, reiterating the nation’s plan to become the premier East Mediterranean energy hub and establish new conventional and renewable power plants, he said.
MEANWHILE- Egypt’s economy grew at a 5.4% clip in 3Q 2021-2022 (the three months ending 30 March 2022) accelerating from 2.9% in the same period last year, according to figures released by the cabinet yesterday. The figure indicates that the economy continued to rebound from the covid-induced slowdown the year prior, despite rising inflation and the commodity price shock exacerbated by Russia’s invasion of Ukraine in late February.
Growth in the January-March period slowed notably from the first two quarters of the fiscal year, which began on 1 July 2021. The economy expanded by 9.8% in 1Q and 8.3% in 2Q. It’s not just about Ukraine: The slowdown in 3Q reflects stronger growth in the corresponding quarter last year, versus the first two quarters of the year whose GDP figures were magnified by a strong base effect.
Full-year outlook upgraded: The government has revised upwards its 2021-2022 growth outlook to 6.2% on the back of the figures. The Planning Ministry had in March cut its full-year forecast to 5.7% due to the war.
WAIT, WAIT — there’s more: Egypt’s official COP27 website will launch in the coming days, cabinet said yesterday. The announcement comes almost two weeks after Egypt unveiled the logo for the upcoming COP27 conference, which will take place in Sharm El Sheikh in November.
Also on the sustainability front: The US Securities and Exchange Commission (essentially their version of our FRA) has proposed new disclosure and naming requirements for ESG funds in what the Wall Street Journal says is “an effort address concerns about ‘greenwashing’ by asset managers seeking higher fees.” Not surprisingly the industry is split on the proposed requirements, with money managers saying the rules will drive up their costs — and force them to pass that on to their investors.
WATCH THIS SPACE #1– It’s a beautiful day in this neighborhood (with apologies to Mr. Rogers). Two aides to US President Joe Biden are on a secret visit to Saudi Arabia for talks on raising oil production, improving ties between Washington and Riyadh, and an agreement between Egypt, KSA and Israel that could pave the way for an unprecedented normalization of relations between Riyadh and Tel Aviv, Axios reported, citing three current and former US officials.
Biden could be in Riyadh next month: The trip comes ahead of a potential visit by Biden to the kingdom at the end of June. Sources say that the two countries need to reach an understanding on all three issues if the president is to visit the country.
What has this got to do with us? Axios reported on Tuesday that the Biden administration is working with Egypt, Saudi Arabia and Egypt to finalize the transfer of Tiran and Sanafir islands from Egypt to Saudi Arabia, a move that it believes could lead to a normalization of ties between Riyadh and Tel Aviv.
This comes as we continue to deepen economic ties with Israel, particularly on transforming Egypt into the Eastern Med’s premier energy hub. (See related story at the top of this morning’s news well, below.)
Meanwhile, MbS is reportedly looking at pulling off his first regional tour since 2018, with whistle stops in Cairo, Amman, Turkey, Greece and Cyprus.
Wait, there’s more: Turkish Foreign Minister Mevlüt Çavuşoğlu became the first Turkish minister to visit Israel in 15 years yesterday, traveling to Jerusalem for talks with his Israeli counterpart, Yair Lapid, Axios reports. The two agreed to revive a joint economic committee and launch talks on a civil aviation agreement, but stopped short of announcing a return of ambassadors as Turkey had reportedly hoped.
WATCH THIS SPACE #2- Egypt + Qatar ties are growing: Acting Health Minister Khaled Abdel Ghaffar discussed investment opportunities in the health sector with his Qatari counterpart Hanan Mohamed Al-Kuwari, on the sidelines of the 75th session of the World Health Assembly in Geneva. (Arab News)
WHAT’S HAPPENING TODAY-
It’s the final day of Davos 2022: “Sombre,” “apocalyptic,” and “uncertain” are just some of the words describing this year’s World Economic Forum (WEF) as the event wraps today. War, food shortages, debt crises, economic uncertainty and climate change have dominated discussions at the elite gathering. And underlining the concerns about a deglobalizing world economy, journos are starting to question the future of the WEF in a rapidly changing world. The UK seems more than happy to help push Davos into irrelevance, and is apparently plotting a rival summit of its own.
Here’s just a sample of the ominous forecasts coming out of Switzerland:
- Global recession incoming? World Bank chief David Malpass warned yesterday that the spillover effects from the war in Ukraine could tip the global economy into recession. (And a gentle reminder, dear reader, that we’re so far looking at slower growth here in Omm El Donia, not at a shrinking economy.) (Reuters)
- WTO warns of extended food shortages: The global food crisis could be with us until 2024 if Ukrainian wheat exports don’t resume, World Trade Organization chief Ngozi Okonjo-Iweala said. (The Guardian)
- The EU is warning of mass migration the longer this goes on: Food shortages could trigger a new wave of migration towards Europe, EU Commission VP Margaritis Schinas said, warning that it is “not going to be so manageable [than Ukrainians fleeing to Europe], it’s going to be more messy.” (Bloomberg)
- Global corporate tax plans face delay: The introduction of the OECD-brokered agreement to introduce global corporate tax rules has been pushed back a year, according to OECD Secretary-General Mathias Cormann, who said that “difficult discussions” were being had over its implementation. It’s now not expected to kick in until at least 2024. (FT)
ON THE WEF AGENDA TODAY: Trade, press freedoms, food technology and the metaverse are all up for discussion, while German Chancellor Olaf Scholz and Iranian Foreign Minister Hossein Amir-Abdollahian will give special addresses.
CIRCLE YOUR CALENDAR-
The Madbouly government will hold public consultations on its privatization plans over three months, according to a cabinet statement. “We as a government are ready to hear all opinions and approaches because our objective is the interest of the country and the advancement of the economy,” PM Moustafa Madbouly said at a Cabinet meeting.
PSA- Companies have another month to bid for the government’s PPP schools program: The Finance Ministry has extended the deadline for receiving bids from private sector companies to build and operate schools under its public-private partnership (PPP) schools program to 26 June, instead of 25 May, Al Mal quoted Ater Hanoura, head of the Finance Ministry’s Private Partnership Unit, as saying.
** Amcham AGM: Our friends at Amcham are hosting their annual general meeting on Sunday, 29 May at the St. Regis Cairo Hotel. Transport Minister Kamel El Wazir will give a guest speech.
The Fin Expo Egypt is kicking off tomorrow and will run until Thursday at the Intercontinental Citystars. The expo will feature over 25 companies exhibiting their fintech products and services with 3k visitors expected.
El Gouna International Squash Open 2022 will kick off on Friday and run until the following Friday, 3 June. The competition will feature some of Egypt’s top seeds including world #1 Nouran Gohar and world #2 Ali Farag (who just earned the PSA squash championship cup). The prize pool for each of the men’s and women’s competitions is USD 180k.
Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.