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Sunday, 13 November 2022

THIS MORNING: We’re getting a breather from COP27 today + UAE official pledges a lot more investment in Egypt

Good morning, friends — it’s a mandatory day off for folks attending COP27, but there’s no rest for the wicked: We have an absolutely packed issue for you this morning, so we’re going to jump right in.

What’s up at COP this week? Wednesday and Friday are this week’s “big days” for the business community: Wednesday is energy day and Friday is solutions day. Check out this week’s full schedule here.

HAPPENING TODAY-

The Senate is back in session after a two-week break for COP27. On the agenda today are final votes on:

  • Amendments that would hand tax breaks to investors who use FX to finance projects;
  • A bill related to the performance of the country’s diplomatic and consular corps.

Also on the agenda: The Senate Financial and Economic Affairs Committee will discuss the recent move by Fitch Ratings to cut its outlook on Egyptian debt from “stable” to “negative.” Meanwhile, the Senate Industry Committee will meet to discuss the industrial agreement the government made with the UN Industrial Development Organization last week.

Remember: The House is still on recess. MPs will return on Sunday, 20 November.

It’s the last day of the International Series Egypt golf tournament in Madinaty — and it looks like former US Amateur champion Andy Ogletree is in position to walk away with the title and the USD 1.5 mn purse after taking the lead in the third round, according to a statement (pdf). Ogletree is ahead of Austria’s Bernd Wiesberger and Canada’s Richard T. Lee, while James Piot (US), Jarin Todd (US), Sihwan Kim (US), and Prom Meesawat (Thailand) are currently tied for fourth place.

THIS WEEK-

It’s the G20 Summit in Indonesia this week: G20 leaders will be in Bali on Tuesday and Wednesday for the 2022 summit (well, most of them). US President Joe Biden and Chinese Premier Xi Jinping are scheduled to have their first-ever face-to-face meeting during the summit.

WATCH THIS SPACE #1- Emirati investments to Egypt could rise by 20-40% by the end of the year, Al Mal quotes Abdullah Al Saleh, under-secretary at the UAE Economy Ministry, as having said, citing “ongoing negotiations between the two countries.” Al Saleh did not say where the UAE may be looking to deploy capital.

REMEMBER– The UAE is one of Egypt’s largest trading partners and its companies have significantly ramped up investments in the country in recent months, with notable transactions including the sale of SODIC to Aldar / ADQ, Chimera Investments’ investment in Beltone, ADQ’s acquisition of Auf Group and its USD 1.8 bn purchase of shares in EGX-listed companies.

WATCH THIS SPACE #2- Egypt is wrapping up procedures to fully join the BRICs-led New Development Bank (NDB), Finance Minister Mohamed Maait said in a statement. Maait said a package will be shipped off to the House of Representatives in the coming weeks to pave the way to Egypt to fully join the bank. His statements come 10 months after the NDB admitted Egypt as a member, paving the way for Egyptian projects to be eligible for financing via the multilateral bank.

What is the NDB? The USD 100 bn Shanghai-headquartered bank was launched in 2015 by the BRICs group of major emerging economies: Brazil, Russia, India, China and South Africa. It funds infrastructure and sustainable development projects in the BRICs and other developing nations.

REALITY CHECK-

It’s going to take several years before Israel can export significant amounts of liquefied natural gas — with help from Egypt — to Europe, Israeli Energy Ministry Director General Lior Schillat told Reuters on the sidelines of COP27.

Reminder: Egypt and Israel are now BFFs with Europe, which is scrambling to secure new gas supplies as Moscow and European capitals sever energy ties over the war in Ukraine. The three sides signed a gas export agreement in June that will see Europe import Israeli natural gas via Egypt’s LNG facilities.

It’s a problem of supply: Though Israel is expecting to significantly increase gas production, it’s going to take at least another three years for the country to have the surplus to ship to Europe. “It is true that most of our surplus gas will be created in the next three to four years,” Schillat said. “So clearly, it’s not an immediate ability to supply gas in the short term. We’re talking about a relatively low amount here.”

Then there’s the issue of infrastructure: Oil Minister Tarek El Molla has also said that without additional investment in infrastructure, it could take two or three years before Egypt is able to increase exports.

THE BIG STORIES ABROAD-

#1- The biggest business story in the world this morning: One of the world’s largest crypto exchanges has gone bust. FTX announced on Friday that it is filing for Chapter 11 bankruptcy and that its CEO Sam Bankman-Fried, once one of the most successful figures in the crypto world, would be stepping down. The collapse came just a few days after Binance abandoned its plans to acquire FTX, saying that the firm’s issues were “beyond our control or ability to help.” Bns of USD were withdrawn from FTX last week after a report revealed a multi-bn USD hole in its balance sheet.

How did the JPMorgan of crypto exchanges collapse so suddenly? That’s the post-mortem being reported out everywhere in the global business press this morning, with regulators investigating mns of USD of unauthorized transactions. (Bloomberg | FT | WSJ | Reuters | CNBC)

#2- The Democrats have retained control of the Senate after Nevada’s incumbent senator, Catherine Cortez Masto, was declared the victor against Republican candidate Adam Laxal a few hours ago. The latest result gives the Democrats 50 seats in the upper house to the Republicans’ 49, meaning that next month’s runoff vote in Georgia will not be the decider, thanks to Vice President Kamala Harris’ tie-breaking vote. The race for the House is also going down to the wire, with Democrats closing the gap as results continue to trickle in. The GOP currently have 211 seats to the Democrats’ 202, meaning that they only have to win seven of the remaining 22 states to secure a majority.

The story is everywhere in the US this morning from the Associated Press and Reuters to Politico.

#3- Important for the region: There’s more signs of progress coming out of Tigray after the Ethiopian military and local rebels have agreed to allow humanitarian aid into the region and set up a joint committee to disarm militias fighting in the conflict, according to the Associated Press. This comes 10 days after the two sides agreed to a ceasefire, raising hopes of an end to the two-year civil war.

enterprise

The Enterprise Climate X Forum, our first industry-specific conference, is taking place on Tuesday, 6 December. The Enterprise Climate X Forum will give insiders and newcomers alike the chance to talk about how to build a climate-centered business — and how to make sure your business continues to have access to the funds it needs to grow. Expect it to be heavy on lessons learned in Egypt and other global growth markets — and lots of success stories.

Stay tuned very soon when we reveal the venue. You’ll love it, we promise.

Some of the biggest names in business and finance are on board — are you? The Enterprise Climate X Forum is taking place with the generous support of our friends, including:

  • Banking partners: HSBC | Mashreq | Attijariwafa Bank
  • Telecom partner: Etisalat by e&
  • Event partners: Hassan Allam Utilities | Infinity

DO YOU WANT TO ATTEND? The first wave of invites is going out now. If you’re a C-suite exec, business owner, climate professional, DFI staff, investor or banker, please email us at climatexrsvp@enterprisemea.com to signal your interest, letting us know your name, title and where you work.

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 HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; 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; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.