THIS MORNING: COP27 negotiators are pulling another all-nighter in search of a climate agreement
Good morning, wonderful people — we hope the weekend was kind to you and that you’re looking forward to a productive workweek. We would love a few days of downtime after the madness of COP27, but (a) negotiations on a climate agreement are still continuing in Sharm, (b) the World Cup kicks off this week, and (c) we have just 42 days left in 2022.
CLIMATE TALKS CONTINUE-
Climate negotiators have been up all night and are still trying to break the stalemate this morning: Countries appear to have made a significant breakthrough on “loss and damage” (aka compensating countries that are vulnerable to climate change) but are seemingly no closer to compromise over reducing emissions. We have the details on the current state of play in this morning’s news well, below.
We’re already on the second day of overtime, but how long could the talks last? Egypt’s chief negotiator, Amb Mohamed Nasr, said in a televised interview last night that he expects the closing session to start at 11am or 12pm today and run for four or five hours (watch, runtime: 12:12).
What we know right now: A new draft agreement was presented to an open plenary session for debate at 4:10am this morning, only for COP27 President Sameh Shoukry to suspend the session for half an hour at Switzerland’s request, according to Bloomberg’s live coverage. “I implore you to adopt the draft decision I will present to you,” Shoukry told the plenary session. “The world is watching.”
^^ We have the rundown on the weekend in Sharm in this morning’s news well, below.
THE TALKS ARE THE BIG STORY in the global business press this morning. Most outlets are leading with news of an apparent breakthrough agreement on loss and damage, then go on to point out that we’re in overtime on talks to “keep 1.5 alive” by agreeing to a warming target. See Financial Times | Wall Street Journal | Reuters | Bloomberg.
(The other big story this morning: Elon Musk is letting Agent Orange back on Twitter — the news leads the front pages of Axios and Politico.)
THE WORLD CUP STARTS TODAY-
The 2022 World Cup starts this afternoon: Qatar and Ecuador will get the 2022 World Cup underway when they kick off the opening game of the tournament at Al Bayt Stadium at 18:00 CLT.
The 60k-capacity stadium will also host the tournament’s opening ceremony at 16:00 CLT. K-pop star Jungkook and Fahad Al Kubaisi will perform. Nicki Minaj, Maluma and Myriam Fares performed yesterday in the fan zone.
Why couldn’t we have played like this before? Egypt beat the Belgians (ranked #2 in the world) 2-1 in a pre-tournament friendly in Kuwait on Friday. Goals from Mostafa Mohamed in the 33rd minute and Mahmoud Trezeguet just seconds into the second half put the Pharaohs 2-0 up against one of the strongest teams in the tournament before Lois Openda got one back late in the game.
Gianni Infantino needs to fire his PR team because clearly nobody told the Fifa president that unhinged press conferences are rarely effective at taking the heat out of a controversy. In a 57-minute rant on the eve of the World Cup, Infantino railed against Qatar’s critics in the Western media, accusing them of hypocrisy using strange culture war rhetoric, and drawing parallels with his experience as a red-haired Italian kid to migrant workers and persecuted members of the LGBT community. The tournament in Qatar has been mired in controversy in the West, where it has received almost universally negative coverage due to the host nation’s mistreatment of migrant workers, LGBTQ rights and others.
Infantino’s controversial press conference got a lot of ink from the foreign press: Bloomberg | Reuters | NPR | CNN and others.
Going to the World Cup? You can enter Egypt without paying visa fees. Ministers decided to waive visa fees for holders of the Hayya card — Qatar’s entry permit for tournament attendees — in a bid to capitalize on the uptick of visitors to the region, cabinet said in a statement Wednesday.
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We have everything you need to know about the World Cup in our latest edition of Your Wealth, which was out this Friday.
RUMORS ARE FLYING-
Meanwhile, some business rumors here at home:
RUMOR HAS IT #1- Is the Qatar Investment Authority eyeing Le Meridien Heliopolis? That’s according to Al Shorouk, which cited unnamed sources yesterday as saying the Gulf state’s sovereign wealth fund is looking to team up with French hospitality giant Accor to acquire the shuttered hotel. The QIA is also in advanced talks to acquire one or more international schools in the Greater Cairo Area, the newspaper also claims.
BACKGROUND- The Qataris have for a while now been in talks with the Madbouly government to acquire stakes in state-owned companies after pledging earlier this year to invest USD 5 bn here as part of a regional effort to provide Egypt with much-needed foreign currency. With talks ongoing and no transactions yet closed, QIA deposited earlier this month USD 1 bn with the Central Bank of Egypt.
#2- Did Al Safy Group just take a majority stake in the owner of the Ramses Hilton? Also in Al Shorouk: Has Egyptian conglomerate Al Safy Group has acquired 53% of the Arab International Company for Hotels and Tourism for EGP 4 bn? The newspaper quotes what it says are sources familiar with the transaction that Al Safi bought stakes held by several regional SWFs, including the Abu Dhabi Investment Authority , the Libyan Investment Authority, and the Kuwait Investment Authority. The Arab International Company for Hotels and Tourism reportedly owns six hotels across Cairo, the Red Sea and Port Said.
What’s Al Safy? The retail-heavy group distributes Samsung and Xiaomi phones as well as Wunder chocolates and operates 300 retail stores across Egypt, including 120 Orange- and >70 Xiaomi-branded stores. It owns the Lighthouse lighting and also has investments or activities in financial services, real estate, and commodities.
THIS WEEK IN THE HOUSE-
Our elected representatives will be back in business today after a two-week break for COP27:
- Today: The House will hold votes on the contractor compensation bill, a law restructuring Al Azhar, and foreign loan agreement with South Korea's Export-Import Bank (KEXIM) that will fund part of the project of upgrading the railway tracks linking Luxor and the High Dam train stations.
- Tomorrow: MPs will discuss and vote on amendments to the Telecommunications Act, and a loan agreement between Egypt and the European Bank for Reconstruction and Development for the rehabilitation of Cairo Metro Line 2.
- Tuesday: Tourism Minister Ahmed Eissa will be in the hot seat to answer questions from MPs on the ministry’s tourism promotion program and its plans to restore antiquities.
DATA POINT #1- Remittances from Egyptian expats fell 19% y-o-y to USD 2.2 bn in August 2022, according to central bank figures (pdf) out last week. Remittance flows were down 9% compared with the month before. Remittances recorded a fresh high for the second year in a row in FY 2021-2022, as rising oil prices boosted transfers from the Gulf. Remittances are a key source of hard currency for Egypt and the outlook remains strong given that most Egyptian expats work in the GCC, where analysts expect there will be an extra USD 1.3 tn in liquidity sloshing around over the next year.
DATA POINT #2- Our LNG exports are en route to hit a 13-year high this month as the country burns more oil for domestic electricity consumption and imports more gas from Israel for liquefaction and re-export, according to a report by oil and gas newsletter MEES. Egypt is set to ship 980k tons of LNG this month, according to projections from data firm Kpler. LNG exports have grown even as domestic gas production slows, in part due to higher imports from Israel, which were up 65% y-o-y in September. The government is aiming for our LNG exports to hit USD 1 bn a month by January as it looks to capitalize on the European energy crunch triggered by the Russia-Ukraine war and position Egypt as a regional energy powerhouse.
Not good for the environment: Egypt is burning mazut at a rate not seen since mid-2018, according to the report, replacing gas flows now being directed to Europe. Mazut is a type of low-quality heavy fuel oil, and generates more air pollution when burned than other types of oil.
There’s more where that came from: The flows from Energean’s newly-launched Karish field will be used for domestic consumption in Israel, MEES says, rather than sent to us as we had previously speculated could be the case. But we should still see a boost to our gas imports from Israel thanks to Karish, the report adds, as more gas is freed up for export from the country’s Tamar and Leviathan fields, from which we already source flows.
DATA POINT #3: Some 10k people registered in the first 48 hours after the launch of the government’s app through which Egyptians living abroad can import a car to Egypt, the Finance Ministry said Saturday. The app, dubbed Sayarat masryeen bel khareg, automatically calculates the required USD payment for expats based on the car model they choose to import. Get it here: App Store | Google Play.
CIRCLE YOUR CALENDAR-
COP27 may be almost over — but climate will remain the world’s largest and most important industry for decades to come. Our Enterprise Climate X Forum will see members of the business community gather at the Grand Egyptian Museum on Tuesday, 6 December 2022.
What’s the Enterprise Climate X Forum? It’s our first industry-specific conference, where CEOs, top execs, investors, bankers and development finance folks have 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. You can learn more on our conference website here.
Some of the biggest names in business and finance are on board — are you? If you’re a C-suite exec, business owner, climate professional, DFI staff, investor or banker, please email us at firstname.lastname@example.org to signal your interest, letting us know your name, title and where you work.