Good morning, folks, and welcome to the last month of the year. We have a busy issue for you today, so without any further ado, let’s jump right in.

PSA-

WEATHER- Take care on the roads this morning in Cairo today with heavy fog forecasted, along with a high of 22°C and a low of 13°C, according to our favorite weather app.

It’s also set to be a foggy day in Alexandria, with a high of 22°C and a low of 13°C.

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HAPPENING TODAY-

#1- We will soon be one step closer to a common Arab electricity market: Arab nations are set to sign two agreements to establish a common Arab electricity market during a two-day session of the Arab Ministerial Council for Electricity being held at the new capital that kicks off today, according to a statement from the Electricity Ministry. The agreements cover the legal and legislative framework for the joint market.

The unified market aims to connect and harmonize the energy systems of 22 Arab countries by 2038, with phased implementation starting 2025, Arab League Energy Director Jamila Matar previously said. The market is expected to operate on a commercial mechanism, enabling energy exchange by utilizing surplus electricity from member states. The initiative, Matar added, could draw on the Gulf electricity interconnection project as a model for success.

#2- The Industry Ministry is offering up 2.6k plots of land to investors across 24 governorates and totalling 15 mn sqm, according to a ministry statement. The plots will be offered up on the newly launched Egypt Digital Industrial Platform for a three week period. The plot sizes range from 120 sqm to 500 sqm, covering industries including food processing, engineering, pharmaceuticals, chemicals, textiles and construction materials.

**We did an Inside Industry deep dive into Egypt Digital Industrial Platform shortly after it launched in September. You can check out the story here.

#3- MPs are back in session today after a two-week break, and are set to discuss and vote on a draft cash-based subsidies bill today that aims to give cash-based subsidies to citizens under the poverty line without access to social insurance. The payments will be made from a Takaful and Karama fund affiliated with the Social Solidarity Ministry funded from the state budget, private contributions, foreign grants and loans, and investments.

NEWS TRIGGERS-

It’s the first day of December — here are the key news triggers to keep your eyes on before the year comes to an end:

  • Will the non-oil private sector extend its two-month slide? S&P Global will publish Egypt’s PMI figures for November on Tuesday, 3 December, measuring the country’s non-oil private sector activity. Last month, non-oil private sector activity contracted again, as rising raw material and utility costs pressured prices and hit new order volumes.
  • Will inflation rise for the fourth month in a row? Capmas and the CBE are expected to publish November’s inflation data early on Tuesday, 10 December. Data for October saw inflation rise 0.1 percentage points to 26.5%, extending its upward trajectory for a third consecutive month.
  • Foreign reserves: The CBE is expected to release November’s foreign reserves figures within the coming days. Reserves hit a fresh high of USD 46.9 bn at the end of October. Egypt’s net foreign reserves have increased by around USD 11.6 bn in the six months since the government announced the USD 35 bn Ras El Hekma agreement.
  • Interest rates: The central bank’s Monetary Policy Committee will meet on 26 December to review interest rates. The CBE left rates unchanged when it last met in November.

FX WATCH-

“It’s natural for this type of movement to occur, so we shouldn’t worry about temporary increases in the USD,” Prime Minister Moustafa Madbouly said in his weekly press conference, responding to concerns about the depreciation of the EGP against the greenback. Madbouly doubled down on the state’s commitment to a flexible exchange rate and explained that the EGP’s recent weakening against the greenback was mirrored by other currencies around the globe as the world’s reserve currency underwent a post-US election uptick in value. “The EGP is part of an existing global system, so it is natural for this type of movement to occur, and therefore we should not worry about temporary increases in the USD.” The EGP is likely to continue fluctuating within a 5% range in the near term, Madbouly added (watch, runtime: 13:13).

FROM THE DEBT MARKETS-

The average yield on six-month t-bills rose 0.27 percentage points to 30.86% in last Thursday’s auction by the Central Bank of Egypt from the last time they were auctioned, according to official data released by the CBE. The bank sold EGP 47.0 bn worth of the bills, surpassing its EGP 35.0 bn target.

Year-long bills saw their yields remain stable at 26.25%, with the bank selling EGP 5.6 bn worth of notes out of a targeted EGP 30.0 bn.

CIRCLE YOUR CALENDAR-

The German-Egyptian Joint Economic Committee will next take place on 18-19 February in Cairo, according to a statement from the Investment Ministry.

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

THE BIG STORY ABROAD-

Our corner of the world is once again in the focus of the global press, with outlets across the world — including the business papers — leading with news of the surprise offensive by Syrian rebels led by former Al Qaeda-affiliate Hayat Tahrir Al Sham that has taken over large chunks of Syria’s largest city Aleppo. Following the government retreat, the rebel forces are consolidating their control of the city and are pushing into the neighbouring governorate of Hama — marking the rebel forces’ most significant advance since 2016 and a major challenge to President Bashar Al Assad’s regime. More than 300 people — including at least 20 civilians — have been killed since the offensive began on Wednesday. (Reuters | Bloomberg | Financial Times | AP | New York Times | France 24 | BBC)

In a depressingly familiar story, more aid workers were killed in Gaza yesterday following a deadly weekend of aerial assaults on the enclave. Israel claimed that one of the aid workers was involved with the 7 October attack on Israel — a claim that Israel did not provide any evidence to support and which his family and the charity deny. (New York Times | Reuters)

There's some hope that a ceasefire could be revived following the ceasefire in Lebanon, with a Hamas and Fatah delegation arriving in Cairo on Saturday for talks with Egyptian officials aimed at securing a ceasefire and planning how Gaza will be governed once the war ends, Al Arabiya reports, citing an unnamed Fatah official.

WHILE IN TRADE WAR NEWS- Trump is setting his sights on Brics nations’ efforts to challenge the dominance of the greenback, with the president elect threatening 100% tariffs unless they abandon plans to challenge the USD’s status as the global reserve currency. “The idea that the BRICS Countries are trying to move away from the USD while we stand by and watch is OVER,” Trump said in a social media post today. (Reuters | Financial Times | Bloomberg | AP)

AND IN BUSINESS NEWS- Asia’s second-richest man Gautam Adani denied allegations that his conglomerate or its officials are facing charges under the US Foreign Corrupt Practices Act, following a federal indictment alleging a USD 250 mn bribery scheme. Adani reaffirmed his company’s commitment to “world-class regulatory compliance” and described the accusations as another hurdle in the group’s resilience-building journey.

Adani blamed “vested reporting” and negative narratives for the controversy, comparing the situation to the short-seller attack by Hindenburg Research in early 2023, which also caused turmoil for the group. (Reuters | Financial Times | Bloomberg)

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