Good morning, friends. An unusually busy week in local business and economy news for Ramadan is ending how it began, and we’ve got a packed issue for you today to prove it. There’s plenty for you to read through this morning, so let’s jump right into it.

So, when do we eat? Maghrib prayers are at 6:12 pm in the capital city, and you’ll have until 4:20 am tomorrow to hydrate and caffeinate ahead of fajr.

WEATHER- Expect another sunny day in Cairo today, with a daytime high of 32°C falling to 20°C, according to our favorite weather app. Be sure to pop on those sunglasses and check if your A/C is ready for the cooler weather to end.

It’s more of the same in Alexandria, with a high of 31°C and a low of 17°C, but look out for rain forecasted from 10pm onwards.

** DID YOU KNOW that we now cover Saudi Arabia and the UAE?

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WATCH THIS SPACE-

FTSE keeps Egypt on its demotion watch: Global index provider FTSE Russell is keeping Egypt on its watchlist for a possible demotion in its equity indexes as it continues to monitor the market following an improvement in foreign investors’ ability to repatriate returns from the country, it said yesterday.

Remember: Egypt was put on the watch list back in October. The country is at risk of being demoted from “secondary emerging market” to “unclassified,” a move which could see Egyptian equities deleted from the provider’s indexes.

Things are looking up: “Market participants report that previous delays in the ability of international institutional investors to repatriate capital from Egypt have been addressed” following the USD 35 bn Ras El Hekma agreement and USD 8 bn IMF package, FTSE said.

The verdict will be out in three months: FTSE Russell will provide an update on Egypt’s watch list status by the end of June 2024, it said.

HAPPENING TOMORROW-

#1- The IMF’s Executive Board is set to give the final thumbs up to our USD 8 bn package with the fund tomorrow, a government source confirmed to Enterprise earlier in the week.

#2- Egypt says goodbye to JPMorgan Chase’s Emerging Local Markets Index Plus: Starting today, the country is out of the lender’s indices that track total returns for local currency denominated funds market instruments in EMs due, after a decision made by the bank at the start of the year.

But hopefully not for long: JPMorgan Chase made the decision before the EGP float, pointing to the then-persistent FX shortage of the country and we’re yet to hear if they’ve decided to reverse the decision now that FX liquidity has come rushing back after liberalizing the pound.

HAPPENING NEXT WEEK-

#1- FY 2024-25 draft budget to head to the House: The draft of the state budget and the first ever Public Government Budget for the next fiscal year will be presented to the House on Sunday after they were greenlit by cabinet yesterday, according to a cabinet statement.

Updated revenues and expenses: The Public Government Budget pencils in revenues of EGP 5.1 tn and expenses of EGP 6.4 tn for the next fiscal year — up from initial projections of EGP 4 tn and EGP 4.9 tn from an Ittihadeya statement a day earlier.

ICYMI: Budget season is going to be a bit different this time round, with the issuing of the first PublicGovernment Budget. The new budget — which does not replace the state budget — shows the budgets of all the state’s economic bodies in addition to the state budget collated together. The first phase includes some 40 economicbodies.

Other key targets in the draft budget include:

  • An increase of over 30% in allocations for the health and education sectors, which are deemed to be of top priority.
  • Channeling 50% of the privatization program’s proceeds into reducing the government’s outstanding debt and improving debt sustainability.
  • An EGP 1 tn cap on public investment for all state entities.

#2- President Abdel Fattah El Sisi will officially begin his third term when he is inaugurated on Tuesday after winning nearly 90% of the vote in December’s presidential election.

Get ready for a cabinet shuffle? El Sisi’s new term is likely to start with some faces at the helm of some of the country’s ministries and other government bodies. Cue the rumor mill.

THE BIG STORY ABROAD-

There’s no single story capturing the imagination of the global press this morning, but watchers of the green economy will want to pay attention here:

Janet Yellen is stirring the pot with China, warning Beijing against dumping key components of the global green economy on other markets.

Yellen claims China is dumping excess production of solar panels, EVs, and lithium ion batteries on other countries. She said the practice “distorts global prices and production patterns and hurts American firms and workers, as well as firms and workers around the world.”

Why the fuss? Western economies are scrambling to catch up to China on clean-tech manufacturing. They see it as critical to energy security, to the green transition, and to bringing manufacturing jobs back to the west. The US is offering tax breaks and subsidies to everyone from green hydrogen producers (hello, Inflation Reduction Act) to key component makers, sparking competition with Canada and the European Union.

Why now? Yellen was speaking on the eve of her second trip to Beijing as US treasury secretary.

Read more: Head to our website for links to stories from the Financial Times and CNBC.

ON A RELATED NOTE- EV and business nerds alike (Elon stans, not so much) will enjoy this morning’s analysis from the Wall Street Journal, which writes that Chinese EV maker “BYD’s rise challenges Tesla — and its valuation. The companies are increasingly close peers while being valued completely differently.”

Tesla is worth about 7x more, and “it takes a lot of faith in Tesla Chief Executive Elon Musk’s promise of autonomy to rationalize the difference,” the Journal suggests.

ALSO WORTH KNOWING ABOUT on this fine Thursday morning:

Daniel Kahneman, one of the founding fathers of behavioral economics, is dead at age 90. The Nobel laureate and his partner Amos Tversky were pioneers of the notion that we don’t make rational economic decisions (take that, Adam Smith). Instead, he explained how we use mental shortcuts, get swayed by emotions, and otherwise simply make choices that frequently fail to give us the best economic outcomes. We’ll have an explainer in EnterprisePM on Sunday, and you can read more in the meantime in the Wall Street Journal.

AND- Just in time to help explain why fast-fashion retailer H&M is delaying somecampaigns: The ‘no-fail’ mission to protect the Red Sea isn’t working,” writes Bloomberg.

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