Good morning, friends, and welcome to another packed news day.

It’s all about the macro picture this morning. The non-oil economy contracted for a 28th month running in March — and Goldman Sachs is sounding the alarm on our external financing gap. The problem, it says, isn’t that we’re importing too much — it’s that we’re not exporting enough.

The ray of sunshine: Sovereign wealth fund boss Ayman Soliman brings positive updates on the privatization program as offers roll in for the state-owned hotels company and the pre-IPO fund looks to onboard another four state-owned firms.

** SO, WHEN DO WE EAT? We’ll be breaking our fasts at 6:16pm CLT today. You have until 4:11am tomorrow morning to hydrate and grab a bite to eat.

BUT FIRST-

Net foreign liabilities deepen again in February: Egypt’s net foreign liabilities rose by USD 1.3 bn in February as continued pressure on the EGP pushed net assets further into the red, according to calculations based on central bank figures. Net foreign assets slipped to a negative USD 23.02 bn from negative USD 21.70 bn in January. It’s the second month in a row that net foreign liabilities deteriorated. Commercial banks were responsible for most of the decline, seeing their liabilities grow by USD 787 mn to stand at USD 13.8 bn.

Two years can make a big difference: Net foreign assets stood at USD 20.39 bn in February 2021 before they began to decline. The outbreak of war in Ukraine in February 2022 accelerated the process as investors pulled bns of USD from our debt market and our import bill shot up, heaping pressure on the EGP and precipitating three devaluations. The currency has lost almost half of its value since last March.

Robust appetite for high-yield CDs: Savers have so far poured some EGP 41 bn into Banque Misr’s new fixed and declining-rate certificates of deposit, Hapi Journal quotes bank chairman Mohamed El Etreby as saying. The NBE and Banque Misr introduced the 22% CDs in the wake of the central bank’s 200-basis-point rate hike last week.

aiBank launches new CDs: aiBank, a unit of EFG Hermes, introduced a new three-year certificate with a fixed interest rate of 17.25% for monthly payouts, 17.5% for quarterly payouts, and 18.0% for annual payouts, according to its website. The minimum deposit is EGP 10k. CIB earlier this week said it was taking to market a 22%, three-year CD. The moves come after the central bank raised interest rates last Thursday by 200 bps.

The FY 2023-2024 budget is with the House: The cabinet on Monday forwarded next year’s budget to the House’s Budget Committee after approving it last week. The committee will hold off discussing the document until after Finance Minister Mohamed Maait and Planning Minister Hala El Said deliver their budget statements on Tuesday.

What we know about the budget: The draft FY 2023-2024 budget puts social spending front and center amid a crunch on Egyptian households, with a 28% increase for social safety programs and significant rises for food and fuel subsidies.

It’s business as usual in the Suez Canal: Traffic along the Suez Canal was not disrupted by a minor scrape between two passing tankers yesterday, the Suez Canal Authority said.

HAPPENING TOMORROW-

The World Bank will release its latest MENA Economic Update: Ominously titled “Altered Destinies,” the multilateral lender’s latest regional growth report will look “in depth at how even temporary increases in the price of food can have lasting impacts across generations in terms of education, health and future income prospects.” The World Bank downgraded its economic growth forecast for Egypt in the current fiscal year by 0.2 percentage points to 4.8% in its most recent update in October.

THE BIG STORY ABROAD-

The int’l press can’t look away from the Trump indictment: Donald Trump pleaded not guilty to 34 felony counts in a Manhattan court, becoming the first former US president to be booked and charged with a crime. The Donald faces charges of falsifying business records to hide hush money he paid to two women to keep extramarital affairs out of the press ahead of the 2016 election.

The story is everywhere this morning: Reuters| AP| BBC| Wall Street Journal | The Guardian | CNBC| ABC News | New York Times | Bloomberg.

AND- Finland is officially a NATO member: Finland became NATO’s 31st memberyesterday after all 30 member states voted to ratify the country’s membership, doubling the length of the military alliance’s border with Russia. “Joining NATO is good for Finland, it is good for Nordic security and it is good for NATO as a whole,” Secretary General Jens Stoltenberg said. Finland applied to join NATO in May 2022 in hopes of bolstering its security following Russia’s invasion of Ukraine.

Sweden is still knocking at NATO’s door: Sweden’s aspirations to join NATO are in the hands of Hungary and Turkey, the two member countries yet to greenlight the move. (Reuters | CNN| BBC| DW| AP| CNBC| NPR | FT)

MARKET WATCH-

The eye of the storm? Traders are concerned that the calm that has followed the recent market turmoil isn’t here to stay and are preparing for further bouts of turbulence in the coming weeks, Bloomberg reports. Last month’s banking crisis that saw the collapse of three US lenders and emergency takeover of Credit Suisse didn’t produce the kind of turmoil seen in the lead-up to the 2008 meltdown but the wild swings have market watchers worried about what might be coming down the line amid uncertainty about interest rates and inflation.

“We expect to see notable market swings also going forward, as investors ponder where central bank rates will end up, what will it take to bring inflation back to target, what will the costs be to the economy — and yes, also who will be the next casualties of higher rates,” said a senior analyst at Nordea Bank.

CORRECTION- In yesterday’s story on DPI and Amethis’ acquisition of a stake in Marcyrl we incorrectly stated that DPI owns a 33% stake in MNT Investments. The firm’s ADP II fund has fully exited its 25% stake in the company, while ADP III has reduced its ownership from 8% to 5%. The story has since been updated on our website.

CIRCLE YOUR CALENDAR-

It’s a brand new month. Here are some economic indicators to look out for:

  • Foreign reserves: Expect the central bank to publish March’s foreign reserves figures before the end of this week;
  • Inflation: The CBE and Capmas will be out with March inflation data on Monday, 10 April.

New and emerging fund managers have until 1 May to apply to the VC Grow accelerator program by GIZ Egypt, AfricaGrow and Dutch development bank FMO. The six-month program offers fundraising support, introductions to potential partners and investors, and workshops, and culminates in a regional summit. To be eligible, funds must have a minimum 25% allocation to Egypt, investing equity or venture debt between the seed to Series A stages.

We are delighted to share with you that the Enterprise Exports & FDI Forum will be taking place on Monday, 15 May at the Four Seasons Hotel at Nile Plaza.

DO YOU WANT TO ATTEND? The first wave of invites is going out soon. If you’re a C-suite exec, exporter, investor, official, banker, or someone who should be part of the conversation, please TAP OR CLICK HEREto request a spot at this exclusive event.

WANT TO BECOME A COMMERCIAL PARTNER? Ping a note to Moustafa, our head of commercial, here.

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

*** It’s Hardhat day — your weekly briefing of all things infrastructure in Egypt: Enterprise’s industry vertical focuses each Wednesday on infrastructure, covering everything from energy, water, transportation, and urban development, as well as social infrastructure such as health and education.

In today’s issue: We follow up on government efforts to onboard the private sector in the development of Egypt’s river transport infrastructure.

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