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Sunday, 19 June 2022

THIS EVENING: FY 2022-2023 budget, amendments to the Competition Act currently under discussion + El Sisi meets with leaders of Bahrain and Jordan

Good afternoon, ladies and gentlemen. It’s a rather slow start to the week on the home front today as we shake off the weekend cobwebs.

It’s also Father’s Day today. Although it’s not as widely recognized or celebrated here in Omm El Donia, we hope all the Dads out there get some love and recognition today.

THE BIG STORY TODAY

BUDGET DEBATE- MPs are now discussing the draft FY 2022-2023 budget and the development plan in a plenary session at the House of Representatives. Representatives will likely put the budget to a final vote likely on Tuesday, House Budget and Planning Committee Chairman Fakhri El Fiqi said last week.

REFRESHER- The proposed budget, which Finance Minister Mohamed Maait and Planning Minister Hala El Said presented to parliament last month, is a crisis spending plan the government revised as the global price of key commodities including oil and wheat started rising even faster than before thanks to Russia’s invasion of Ukraine.

THE BIG STORY ABROAD

It’s a thoroughly mixed bag of nuts in the international press this afternoon. Whispers of a potential recession in the US are beginning to be heard, with economists now forecasting a 44% chance of recession in the next year, according to the Wall Street Journal. Recession fears are leading companies to pull the brakes on stock market debuts, while consumers are shifting their spending habits amid soaring inflation, piling pressure onto some industries such as real estate, CNBC reports.

HAPPENING NOW-

The House Economic Committee will begin discussing proposed amendments to the Competition Act. The proposed amendments, which have been in limbo since last year, would require companies to notify the Egyptian Competition Authority (ECA) of mergers and acquisitions they plan to undertake, and grant the ECA the power to reject these transactions before they go through.

A tripartite summit between Egypt, Jordan, and Bahrain is ongoing in Sharm El Sheikh, with President Abdel Fattah El Sisi meeting with Jordan’s King Abdullah and Bahrain’s King Hamad bin Isa Al Khalifa, according to an Ittihadiya statement. Bahrain’s leader arrived in Sharm yesterday where he held talks with El Sisi.


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

  • The Central Bank of Egypt is likely to leave interest rates unchanged this week despite rising inflation and accelerating global monetary tightening, according to our regular analyst poll.
  • Egypt’s imports of Russian wheat climbed 84% y-o-y in the three months from March to May despite disruption caused by the war in Ukraine.
  • Has the down round boogeyman come to Egypt? A number of startups in Egypt are facing the prospect of down round financing — when a company sells shares at a lower price than its previous funding round — but will not be as dramatic as they are in the West.

enterprise

*** It’s Inside Industry day — your weekly briefing of all things industrial in Egypt. Inside Industry focuses each Sunday on what it takes to turn Egypt into a manufacturing and export powerhouse, ranging from initial investment and planning to product distribution, through to land allocation to industrial processes, supply chain management, labor, automation and technology, inputs and exports, regulation and policy.

In today’s issue: In a push to increase local manufacturing, the government has introduced reduced customs duties on several components and parts for everything from EVs to renewable energy. It has also provided customs reductions based on the percentage of local components used in the manufacturing process, in a bid to further encourage local industry. Enterprise has sifted through the numbers to outline where the new incentives reflect some of Egypt’s current priorities and explains how to make sense of the accounting side of the new incentives.

HAPPENING THIS WEEK-

The Central Bank of Egypt’s (CBE) Monetary Policy Committee meets this Thursday, 23 June to review interest rates. Our regular poll of analysts and economists suggests the CBE will keep rates on hold, as it looks to adopt a wait-and-see approach on inflation and allow itself space to maneuver if inflation rates continue to rise.

🗓 CIRCLE YOUR CALENDAR-

The government’s fuel pricing committee will meet in the first week of July, before Eid, to decide on prices at the pump, Oil Minister Tarek El Molla confirmed to Kelma Akhira (watch, runtime: 2:13). The committee’s last quarterly meeting saw it raise fuel prices by around 3% amid a rise in global prices triggered by the war in Ukraine.

Amcham AGM this week: Our friends over at Amcham will hold their annual general meeting on Monday 27 June at the St. Regis Cairo Hotel. Finance Minister Mohamed Maait will address the gathering.

Conferences coming up this week and next:

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

☀️ TOMORROW’S WEATHER- Expect a daytime high of 38°C tomorrow in the capital city and a nighttime low of 21°C, our favorite weather app tells us.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Etisalat Misr (tax ID: 235-071-579), the leading telecoms provider in Egypt; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.