Good afternoon, friends, and welcome to the start of another workweek. To start you off, we’ve got an exclusive on Egypt securing a two-year reprieve from the EU’s carbon border tax, a deep dive into the plastics industry’s green crossroads, and a guide to financing your next car.

THE BIG STORY TODAY-

📍 EXCLUSIVE- Egypt has received preliminary approval from the EU to exempt its exports from the Carbon Border Adjustment Mechanism (CBAM) until the end of 2027, two government sources tell EnterpriseAM. This diplomatic W following earlier lobbying for the move, reported on exclusively by EnterpriseAM last week, grants local energy-intensive manufacturers — think steel, fertilizer, aluminum, and cement sectors — a crucial two-year window to decarbonize before facing punitive border tariffs.

Why this matters: Failure to comply with the carbon border tax or decarbonize at pace would cost local manufacturers an estimated USD 317 mn annually in carbon surcharges, according to Environment Ministry studies seen by EnterpriseAM. By pushing the deadline, Egypt is protecting the competitiveness of its exports in its largest market and prevents an imported inflationary spike that would have hit the local market if producers passed on compliance costs.

THE BIG STORY ABROAD-

🌐 No single story is headlining the business pages today, but oil continues to make the rounds around the globe:

US President Donald Trump signed an emergency executive order to block courts and creditors from seizing Venezuelan oil revenue held in US Treasury accounts, according to the White House. The order states that the revenue is “held solely for sovereign and diplomatic purposes.”

Oil traders are shifting focus from Venezuela to Iran after the US’ agreement to import mns of Venezuelan oil barrels led to a price drag. Iran has been experiencing deadly protests and threats of US retaliation over the past few days, and experts believe that as a “far bigger producer and exporter,” a supply disruption in Iran would be more impactful.

^^Read more on: Bloomberg, CNBC, and Reuters.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

  • Egypt is in a high-stakes standoff with Israel over our USD 35 bn gas agreement as Cairo refuses to accept what amount to new “Israel first” clauses inserted by the Israeli government;
  • Annual urban inflation was unchanged at 12.3% in December, the same pace at which prices rose the month before. This came even as the price of food and beverages rose 1.5% y-o-y last month compared to 0.7% y-o-y in November;
  • The government might use the tax code as part of a bid to solve one of the EGX’s most long-standing issues — liquidity. A package of tax reforms currently being finalized would see the exchange introduce a tiered, performance-based tax system that rewards companies based on their actual trading volumes and freefloat size.

enterprise

*** It’s Inside Industry day — your weekly Sunday briefing of all things industrial in Egypt. Inside Industry explores what it takes to turn Egypt into a manufacturing and export powerhouse, ranging from initial investment and planning through to product distribution, land allocation, industrial processes, supply chain management, labor, automation and technology, inputs and exports, and regulation and policy.

In today’s issue: We’re taking a deep dive into Egypt’s plastic industry as it leans into recycling and diversification to stay competitive.

☀️ TOMORROW’S WEATHER- We’re in for a cool, breezy day in the capital tomorrow with plenty of sunshine. Temperatures are set to peak at just 21°C before cooling down to 11°C, according to our favorite weather app.

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