A whole lot of economic news

1

What We're Tracking Today

Egypt’s foreign reserves inch up to USD 34.55 bn in April

Good morning, friends, and welcome to another very busy Sunday to kick off budget week in the House of Representatives. We hope you enjoyed your long weekend — it’s the last such break for our Egypt-based readers until we observe the anniversary of the 30 June Revolution.

THE BIG STORY here at home: The IMF says Egypt is committed to a flexible exchange rate: The government is “serious about having a flexible exchange rate,” the IMF’s director for the Middle East, North Africa and Central Asia, Jihad Azour, told Asharq Business in an interview last week.

But no news on the first review: “There is strong collaboration between the Fund’s team and Egyptian authorities,” Azour said, adding that the government has been “preparing” for the review since the IMF / World Bank Spring Meetings last month.

Why this matters: Our USD 3 bn loan program from the IMF is contingent on implementing reforms that include the move to a “fully flexible” EGP-USD exchange rate and widening private participation in the economy. Bloomberg reported last month that the Fund wanted to see us make more progress on those reforms before it goes ahead with the first review of the package, which had been expected in mid-March. The IMF’s executive board should discuss the first review by June, but in the case of a longer delay the lender may combine it with the next one, which is scheduled for September, according to Asharq.

A vote of confidence following a string of bad reports: Azour’s comments to Asharq come following a series of negative credit reports from the big three rating agencies, which are voicing increasing concern about the speed at which authorities are moving forward with their privatization agenda and the lack of new FX inflows. Fitch is the latest to downgrade us, as we note in this morning’s news well, below.

The first IMF review is just “a matter of time,” Finance Minister Mohamed Maait told El Hekaya last night (watch, runtime: 31:44). “We were aiming to schedule the review for March but we were hit with a number of issues, including that it was the beginning of Ramadan … we are hoping to have the first review before June,” he said.

DATA POINT- FX reserves continue to creep up: Our net foreign reserves inched up to USD 34.55 bn in April from USD 34.45 bn in March, according to central bank figures out last week. Reserves have been on a gentle upward slope the past seven months, after falling 20% last year on the back of the war on Ukraine and tougher financial conditions.

WATCH THIS SPACE- Gold and aluminum coming to the EMX this year? The EGX is looking into adding gold and aluminum to the list of commodities trading on the Egyptian Mercantile Exchange (EMX) during the second half of the year, Al Borsa reports, citing unnamed government sources.

HAPPENING THIS WEEK-

It’s budget week in the House: Finance Minister Mohamed Maait and Planning Minister Hala El Said will deliver statements in the House for the draft FY 2023-2024 budget when MPs reconvene on Tuesday. This will kickstart a month of discussions at the House Budget Committee. The budget will then be up for debate and a vote by the House in a plenary session.

What we know so far: The Madbouly government plans to up spending on subsidies and socialprotection programs to offset the impact of soaring inflation on households, and has released its fiscal targets for the coming year. The Finance Ministry has penciled in oil prices of USD 90 per barrel for FY 2023-2024, up from USD 80 per barrel this fiscal year, House Budget Committee chairman Fakhry El Feky was quoted as telling Asharq Business yesterday. Cabinet approved the draft budget last month.

HAPPENING TODAY-

Arab League to vote on readmitting Syria: Arab foreign ministers are meeting in Cairo today to discuss ties with Syria, with an anonymous diplomat telling CNN that the organization will vote on bringing Damascus back into the fold. This follows several rounds of talks between Arab diplomats last week aimed at bringing the country back into the league.

The pro-Syrians have the votes: That’s according to Jordan’s foreign minister, Ayman Safadi, who told the US news outlet that he believes the league will vote to readmit Syria today. Should the vote go through, President Bashar Al Assad is likely to be invited to chair the next meeting on 19 May, the anonymous official said.

AND- The Senate reconvenes today after a three-week break: The industrial, economic affairs, tourism and energy and environment committees are among those holding sessions today.

HAPPENING TOMORROW-

It’s Investment and Sustainable Finance Day:The CFA Society is hosting its Investment and Sustainable Finance Day tomorrow, featuring a variety of speakers from the International Finance Corporation, CI Capital, and the Financial Regulatory Authority’s Mohamed Farid.

HAPPENING NEXT WEEK-

National Dialogue sessions to start next week: The first session of the National Dialogue will take place on Sunday, 14 May, member of the board of trustees, Talaat Abdel Qawi, said in a televised interview yesterday (watch, runtime: 6:48). Sessions will be held every Sunday, Tuesday and Thursday, he said.

The National Dialogue was inaugurated on Wednesday: We have the story in this morning’s news well, below.

THE BIG STORIES ABROAD-

Charles 3.0 finally got to wear his crown:Reuters | Associated Press | Bloomberg | Financial Times | BBC | NYT | Washington Post | WSJ.
We’ve officially reached the end of covid, according to the WHO: Reuters |Associated Press | CNN | Financial Times | Politico.
A drone exploded over the Kremlin on Wednesday — but no-one knows what happened:Reuters | Associated Press | NYT | Washington Post.

The Enterprise Exports & FDI Forum, our latest industry-specific conference, is taking place on Monday, 15 May at the Four Seasons Cairo Nile Plaza The Enterprise Exports & FDI Forum will give insiders and newcomers alike the chance to talk about how to develop an export-centered business and how their companies can help Egypt build an export-led economy that makes us a magnet for foreign direct investment (FDI).

Expect the gathering to be heavy on lessons learned in Egypt and other global growth markets — and to feature lots of success stories.You can learn more on our conference website here.

Some of the biggest names in business and finance are on board — are you? The Enterprise Exports and FDI Forum is taking place with the generous support of our friends, including:

Banking partners: Banque Misr | Al Baraka Bank | Emirates NBD | HSBC

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

HAVEN’T REQUESTED AN INVITE YET?We have a limited number of seats available. If you’re a C-suite exec, business owner, DFI staff, export executive, investor or banker, please fill out the form here to signal your interest, letting us know your name, title and where you work.

The World Aquatics Festival at Somabay: Three remarkable aquatic tournaments will be held together for the first time in Egypt, presented by the World Aquatics Federation and the Egyptian Swimming Federation in partnership with Somabay. Prepare yourself for the action. 8-9 May: Open-Water Swimming World Cup. 13-15 May: Artistic Swimming World Cup. 12-15 May: World Beach Water Polo Qualifiers.

Egypt records current account surplus for first time in almost 9 years in 2Q 2022-2023

Egypt generated a current account surplus for the first time since 2014 in 2Q FY 2022-2023 due primarily to falling imports, according to Enterprise calculations based on central bank figures (pdf) released Wednesday. The current account turned to a USD 1.41 bn surplus during the October-December period, compared to deficits of USD 3.8 bn in the same period a year earlier and USD 3.19 bn the previous quarter.

KEY DRIVERS OF THE IMPROVEMENT-

#1- Falling imports: Egypt’s trade deficit recorded its smallest deficit in 12 years in 2Q FY 2022-2023, narrowing to USD 6.45 bn from USD 10.64 bn a year earlier and USD 9.1 bn in 1Q. This was driven by a 20% decline in imports, which fell to USD 17.99 bn from USD 22.48 bn a year earlier, primarily due to the import restrictions imposed last year in response to the FX shortage. Meanwhile, the country exported USD 11.54 bn worth of goods during the quarter, down 3% y-o-y but up from almost USD 10 bn in the previous quarter.

#2- Tourism rebound continues:Tourism revenues rose 9% y-o-y to USD 3.25 bn, compared to USD 2.98 bn in 2Q FY 2021-2022, but fell more than a third from the previous quarter. Expect the rebound to have continued in the January-March quarter: arrivals reportedly rose 33% y-o-y during the first four months of the year, putting the government on track to meet its target of 15 mn visitors in 2023.

#3- Suez Canal revenues up:Suez Canal receipts rose 17% to USD 1.97 bn, up from USD USD 1.7 bn a year earlier. Revenues were down slightly from USD 2 bn from 1Q.

#4- Rising FDI: Foreign direct investment climbed 52% to USD 2.43 bn, from USD 1.6 bn a year earlier. Inflows fell 26% on a quarterly basis from USD 3.3 bn in 1Q.

TO THE DOWNSIDE-

#1- Portfolio outflows continue: The country clocked net portfolio outflows of USD 855.4 mn during the quarter as investors continued to pull money out of the country amid the economic uncertainty. The upside: Outflows eased markedly from USD 6 bn a year earlier during the height of the global economic shock caused by Russia’s war in Ukraine.

#2- Remittances fell: Remittances from Egyptians abroad fell 25% y-o-y to USD 5.56 bn. They also fell 14% from 1Q when they registered USD 6.44 bn.

The story received international coverage:Reuters.

Egypt’s non-oil private sector contracts at a softer pace in April

Private-sector activity sees softest decline since October: Egypt’s non-oil private sector contracted for the 29th consecutive month in April — but did so at its slowest pace in six months as a more stable exchange rate helped to alleviate inflationary pressures, according to S&P Global’s purchasing managers’ index (pdf). The index rose to 47.3 in April from 46.7 in March, remaining below the 50.0 mark that separates growth from contraction.

What they said: “The latest PMI figures for Egypt provided some promising hints for the direction of the non-oil economy, particularly on inflation,” said David Owen, senior economist at S&P Global Market Intelligence. “Relative calmness in currency markets led to reduced pressure on import prices, culminating in the softest rise in purchase costs for a year and one that was weaker than the trend rate. The slowdown encouraged firms to raise their own charges to a lesser extent, which helped to partly alleviate the downturn in sales.”

Could inflation finally start to cool? Though high inflation continued to weigh on activity and demand, businesses recorded the softest decline in output in four months and the softest decline in new orders in six months. “The findings suggest that headline inflation in Egypt should begin to soften over the coming months,” Owen said. Headline inflation hit 32.7% y-o-y in March, approaching July 2017’s record high of 33%. April inflation figures should be released this Wednesday, 10 May.

But pessimism remains high: The “high degree of uncertainty” over future economic conditions led businesses to report their weakest outlook for the year ahead in the series’ 11-year history.

The reading got coverage overseas:Reuters | Bloomberg.

FROM THE REGION-

Saudi Arabia’s PMI (pdf) rose to 59.6 in April from 58.7 in March, only slightly below its eight-year peak of 59.8 in February. Growth came on the back of rising tourism, consumer spending, and new business tied to major infrastructure projects.

The UAE’s PMI (pdf) also rose to 56.6 in April from 55.9 in March, just short of its post-pandemic peak. New orders increased rapidly as easing market conditions including slower inflation and rising demand led businesses to offer promotions in a bid to capture market share.

Fitch downgrades Egypt’s credit rating for the first time since 2013

Fitch Ratings has downgraded Egypt’s sovereign credit rating for the first time since 2013, cutting it one level to B from B+ and maintaining its negative outlook. The downgrade comes on the back of “high external financing requirements, constrained external financing conditions and the sensitivity of Egypt's broader financing plan to investor sentiment,” the ratings agency said on Friday.

The Big Three are feeling downbeat: Fitch Ratings’ decision comes a few months after a similar move by Moody’s which in February cutEgypt’s rating to B3, and two weeks after S&P Global Ratings downgradedits outlook to negative.

The rationale: Uncertainty about our ability to secure external funding. Limited access to debt markets and weak foreign currency inflows — largely due to a lack of investor confidence in our exchange rate regime — are weighing on the country’s ability to meet its needs for external financing. “We see a risk that a further delayed transition to a flexible exchange rate will further undermine confidence, and, potentially, delay the IMF program,” Fitch wrote, noting that it had detected a “marked deterioration” in the country’s public debt indicators which will “put medium-term debt sustainability at risk” if not reversed.

The FX market is key: Investors are reluctant to participate in the foreign exchange market due to “high uncertainty [regarding] the future exchange rate level [and] interventions by public sector banks,” the report said. The USD-EGP exchange rate has remained unchanged since mid-March following three devaluations that have caused the EGP to more than halve in value against the greenback. Fitch “assumes that the exchange rate will depreciate further before stabilizing in the financial year ending June 2024.”

How much external financing do we need? The government seeks to drum up some USD 10 bn annually in FDI starting in the current fiscal year — in addition to an unspecified amount of portfolio inflows — to cover the current account deficit. Around USD 7.2 bn worth of external government debt will mature in FY 2023-2024 — up from USD 4.3 bn this year — exerting further pressure on our external financing needs, according to Fitch.

Gulf inflows key: “We continue to believe GCC support to Egypt's economy is strong, and successful divestment deals with Gulf partners would help restore confidence and unlock further investments,” Fitch wrote.

REMEMBER- Egypt’s attempts to sell state assets to Saudi Arabia, the UAE and Qatar have stalled in recent weeks amid uncertainty about both the exchange-rate and progress on economic reform. The three Gulf states last year pledged to provide more than USD 20 bn in investment and funding for Egypt to help shore up the country’s FX reserves following the economic shock triggered by the war in Ukraine.

Egypt hikes diesel price by 14%, leaves gasoline prices unchanged

The government has raised the price of diesel by EGP 1.00 to EGP 8.25 per liter, the Oil Ministry saidon Wednesday. The decision came into effect on Thursday at 2am CLT.

The price of diesel has now risen 22% since last July, when the government increased theprice for the first time in years following the commodities shock triggered by the war in Ukraine.

The rationale: The price to the government of diesel has risen to EGP 12.25 per liter on the back of higher prices in the global market as well as the EGP devaluation, the Oil Ministry said in a separate statement. The hike will reduce the government’s expenditure on diesel subsidies to an average of EGP 64 bn per year from EGP 80 bn.

Expect more inflation: Diesel is the main fuel used by vehicles that transport goods and rawmaterials around the country, as well as modes of public transport.

Public transport fares — including taxis, microbuses and buses — increased around 10% nationwide on the news, marking their second fare hike in less than a year when they rose following last July’s diesel price hike. Each governorate has released its updated fares, according to the Local Development Ministry.

Gasoline prices were left unchanged: Having already hiked the prices of gasoline(petrol) in March, the committee decided to keep the price of 95-octane at EGP 11.50 per liter, 92-octane at EGP 10.25 per liter, and 80-octane at EGP 8.75 per liter. The price at which mazut (fuel oil) is sold was also kept unchanged.

Bread prices to remain as is: The Madbouly government will subsidize the higher cost of bread caused by the price hike. “We are reassuring citizens that the price of the subsidized bread loaf will remain unchanged and so will its weight,” Abdallah Ghorab, head of the bakery division at the Egyptian Federation of Chambers of Commerce (Fedcoc), told Kelma Akhira’s Lamees El Hadidi (watch, runtime: 3:51).

Producers won’t pass on higher fuel costs? That’s according to Fedcoc secretary-general, Alaa Ezz, who in an interview on Kelma Akhira last night said that producers will shoulder the impact of higher diesel prices, which he estimated would raise commodity prices by 0.2% (watch, runtime: 4:07).

Remember: The government has committed to changing local fuel prices in line with movements in the global markets under its USD 3 bn loan agreementwith the IMF.

Egypt to study Scatec interconnector proposal

A step towards an electricity link with Europe: Ministers approved on Wednesday the signing of an MoU with Norwegian renewables developer Scatec to study a new 3-GW Egypt-Europe electricity interconnection project, cabinet said in a statement following its weekly meeting.

What we know: The CEO of the Norwegian company in February proposed to the governmentestablishing a 3-GW link between Egypt and Italy, allowing the North African country to export renewable energy to Europe. The project would be backed financially by the Norwegian government.

This is the latest in a growing number of proposed Egypt-Europe interconnectors: The loss of Russian energy supplies has forced the European Union to rapidly strengthen energy ties with countries in the eastern Mediterranean and build the infrastructure necessary to increase its imports of natural gas and electricity from countries in the region.

The news received international attention:Reuters.

CABINET ALSO APPROVED-

A draft law criminalizing harassment and bullying;
Amendments to the Child Act that would extend maternity leave rights to adoptive mothers of babies less than six months old;
Draft bills giving the Oil Ministry the go-ahead to sign four oil exploration contracts in the Gulf of Suez and two oil and gas exploration contracts in the Eastern Mediterranean. The contracts would be signed with various companies including state-owned firms EGPC and EGAS, as well as BP, Wintershall Dea, and Trident Petroleum.

An Egyptian investment firm led by AIH’s chairman wants to acquire minority stakes in two AIH subsidiaries

AIH chairman wants a piece of two AIH subsidiaries: The family office of the head of Arabia Investments Holding has submitted a binding offer to acquire significant minority stakes in two of the EGX-listed company’s subsidiaries, according to an AIH disclosure (pdf) to the bourse on Wednesday. JAF Investment (LinkedIn), which is headed up by AIH chairman Gamal Abdelfatah Othman, has offered to purchase a 30% stake in SME finance firm UE Finance for EGP 147 mn and a 30% stake in Rawaj Consumer Finance for EGP 30 mn in two all-cash transactions, according to the disclosure.

The AIH connection: JAF Investment Othman’s family office. Five members of the family are listed on the board, including AIH board member Khaled Gamal Abdelfatah Othman and Ali Abdelfatah Othman, who serves as its deputy CEO. Ezz Kamel Ebrahim Ezz, who also sits on the board at AIH, is JAF’s CEO. “Given that our company is considered a related part of AIH, we hereby confirm our full commitment in observing all the principles of conflict of interest,” JAF’s offer reads.

JAF’s main focus is private equity: The company says it has “more than 30 years of exposure in the contracting and real estate sector in Egypt and the UAE.” Its main focus is private equity investment in several sectors including real estate, non-banking financial services, contracting, healthcare, education, automotive services and trading, and logistics and warehousing.

Market reacts: AIH shares rose 5.9% to close at EGP 0.36 on Wednesday.

What’s next: AIH said its board is considering the offer, which would remain contingent on regulatory approval if the board gives it the green light.

Egypt launches National Dialogue

The National Dialogue is finally underway: President Abdel Fattah El Sisi on Wednesday inaugurated the opening session of the National Dialogue after a year of preparations, according to a statement by the organizers. In a recorded speech to participants, El Sisi said the dialogue was necessary to address “the growing challenges facing the Egyptian nation at all levels,” adding that he hoped to participate in its final stages. Prime Minister Moustafa Madbouly attended on Wednesday, as did several government ministers, ambassadors, heads of political parties, House and Senate reps, trade union and civil society leaders, and journalists. The entire two-hour session was broadcast live (watch, runtime: 2:08:44).

REFRESHER- The dialogue will hold three meetings a week for an unspecified duration to discuss more than 100 political, economic, and social issues. Some 800 individuals have been invited to participate. All sessions will be broadcast to the public.

Not up for discussion: The constitution, foreign policy, or national security issues,according to the dialogue’s general coordinator, Diaa Rashwan. None of the parties who accepted an invitation to participate in the dialogue wanted to discuss amending the constitution, Rashwan said, adding that “we fully support Egypt's current foreign policies and the armed forces' role in preserving national security."

What’s the aim? The dialogue will “put forward the people's demands before the concerned authorities and the president,” Rashwan said. Veteran diplomat Amr Moussa, who also gave a speech on the first day of the dialogue, said its final recommendations should go straight to parliament to be discussed by lawmakers and then turned into legislation by the government, rather than sent directly to the president.

What’s next: The dialogue’s next sessions will take place in the next 7-10 days, Rashwan said on Friday (watch, runtime: 23:13).

The news got international attention:Reuters.

Sudan’s factions hold first direct talks since conflict

Sudan talks kick off in Jeddah: Representatives of the warring Sudanese factions were in Saudi Arabia yesterday for direct talks aimed at bringing an end to the three-week conflict. The “pre-negotiation talks,” sponsored by Saudi and US diplomats, brought together the Sudanese Army and paramilitary Rapid Support Forces (RSF) face-to-face for the first time since the fighting began in mid-April.

What they said: Not much of substance, so far. Check out the joint US-Saudi statement here or dive in to statements from the Sudanese Armed Forces, the RSF, and Egypt’s foreign ministry. Foreign Minister Sameh Shoukry spoke with both Sudan’s de facto leader, Gen. Abdel Fattah Al Burhan, and Hemedti by phone on Thursday.

The fighting hasn’t stopped: “Our forces clashed with a group of rebel militia this evening … our forces confronted them with force,” the Sudanese army said last night. The two sides agreed to a week-long ceasefire starting Thursday though reports of airstrikes and fighting continued through the weekend.

FAST FACT- Some 42.3k people had crossed the border into Egypt between the start of the conflict and last Tuesday, according to the UN’s Refugee Agency, UNHCR. The vast majority of them — around 40k — are Sudanese, it said.

Aldar Properties profits up 22% in 1Q 2023 , says it is a long-term investor in Egypt

Record sales drive 22% profit growth at Aldar:Aldar Properties reported a 22% increase in net profit in 1Q 2023 on the back of rising demand in its domestic market, according to its earnings release (pdf) out on Wednesday. The Abu Dhabi-based real estate developer’s bottom line hit AED 836 mn in the January-March quarter, driven by a 14% increase in revenues which hit AED 3.1 bn.

Record quarterly sales: Aldar reported a record AED 4.5 bn in sales during the quarter, fuelled by stronger demand among overseas and resident expats. Meanwhile, revenues at the company’s investment arm rose 45% to AED 1.25 bn on the back of rising occupancy rates, higher rental rates, and new acquisitions.

Backlog at all-time high: The company’s backlog hit a record AED 18.8 bn in 1Q, which it said will provide “revenue visibility over the next 2-3 years.”

What they said: Aldar CEO Talal Al Dhiyebi put the strong sales figures down to the company’s new launches in Abu Dhabi. “The success of these launches paved the way for our highest ever quarterly sales of AED 4.5 bn, and played a large part in Aldar’s stellar performance during the first three months of the year,” he said.

Aldar is committed to being a “long-term strategic investor in Egypt,” the company said in a disclosure (pdf) later on Wednesday after a senior executive at Aldar was quoted by Reuters as saying it would be “very cautious” about new project launches in Egypt given current economic conditions. Aldar is majority owner (along with Abu Dhabi sovereign wealth fund ADQ) of upmarket real estate developer SODIC. “SODIC’s future growth potential continues to be positive with a revenue backlog of almost EGP 35 bn. It is also working on expanding its landbank in multiple areas across Egypt, including West Cairo, East Cairo, and the North Coast,” Aldar said.

BACKGROUND- Aldar and ADQ acquired SODIC in 2021; the Emirati developer has since tried on at least two occasions to grow its footprint here via acquisition (here and here)

Mashreq appoints a new tech chief

Our friends at Mashreq Bank have appointed Mohamed Abdel Hamid Abdel-Razek(LinkedIn) as the group head of technology, transformation and information,the bank announced last week. With 30 years of experience in the tech field, he counts Schlumberger, British American Tobacco, and Standard Chartered Bank among his previous employers before joining Mashreq.

Egypt’s finance minister reiterates confidence in economy in on-air interview

FinMin takes to the airwaves: Finance Minister Mohamed Maait joined El Hekaya (watch, runtime: 31:44) last night for a 30-minute interview focused on reassuring the public about the economy following a less-than-optimistic review from Fitch Ratings, which last week became the latest rating agency to downgrade our sovereign credit rating (more on that in this morning’s Economy section, above).

It has been a tough couple of years: “The Egyptian economy has been under immense pressure since the pandemic,” Maait said, pointing to the shock caused by covid-19 and its impact on tourism, exports, and public finances. The country’s recovery from the pandemic was then derailed by the war in Ukraine, which took aim at Egypt’s food security and again disrupted the tourism industry. “We will overcome this crisis,” he told show host Amr Adib. “We are confident in the Egyptian economy … it’s just a matter of time.”

Choice words for rating agencies: The minister accused the international rating agencies of being biased against Egypt. “There is prejudice [against Egypt],” Maait said, adding that a single day could see eight new economic reports on Egypt. Each of the big three rating agencies have taken negative action on Egypt in recent months, with Fitch and Moody’s both downgrading its rating due to the intensifying economic crisis.

The economy continues to dominate the conversation on Egypt in the foreign press

Heading up international coverage on Egypt this morning: The economy is dominating the conversation on Egypt in the foreign press this morning in the wake of the new current account figures, the latest PMI release and Fitch’s decision on Friday to downgrade Egypt’s credit rating. We have all the details on all of these stories in this morning’s news well, above.

Proparco commits USD 5 mn to Disruptech. PLUS: Cairo hosts counterterror forum.

INVESTMENT-

Proparco invests in Disruptech: Proparco, the private-sector investment arm of the French Development Agency (AFD), has committed USD 5 mn to Disruptech Ventures’ early-stage fintech fund, it said in a statement yesterday. The fund has so far secured USD 36 mn in investments from various DFIs and investment funds, including USD 5 mn from the International Finance Corporation.

Disruptech has so far deployed 40% of its capital in tech startups, including Brimore, Cassbana, Fatura, Gahez, Khazna, MNT Halan and Mozare3.

DIPLOMACY-

US congressional delegation in Cairo:President Abdel Fattah El Sisi and Shoukry met in Cairo talks with a bipartisan US congressional delegation last week. The delegation was led by Rep. Michael McCaul (Republican of Texas), who was in town for the Global Counterterrorism Forum, co-hosted by Egypt and the European Union. McCaul is chairman of the House Committee on Homeland Security.

Federal Reserve raises interest rates by another 25 bps despite regional banking crisis

Federal Reserve, ECB push on with rate hikes: The Federal Reserve hiked interest rates by another 25 bps on Wednesday amid mounting signs of financial stability among the country’s regional lenders. The central bank raised the fed funds rate to 5-5.25% — the highest level since 2007 — after unanimously agreeing on the tenth hike in a little over a year, it said in a statementon Wednesday.

The end of the Fed’s aggressive tightening cycle? “That’s a meaningful change that we’re no longer saying that we anticipate [further increases],” Fed Chairman Jerome Powell said during a presser (watch, runtime: 52:00), when asked if the statement should be taken as a signal that the Fed will pause rate increases in June. “We’ll be driven by incoming data, meeting by meeting, and we’ll approach that question at the June meeting.” Headline inflation remained significantly above the Fed’s 2% target in March, rising by 5% during the month.

The Fed may almost be done, but the ECB isn’t ready to pause:One day after the Fed’s decision, the European Central Bank (ECB) announced a 25-bps hike of its own, pushing its deposit rate to 3.25%. “Headline inflation has declined over recent months, but underlying price pressures remain strong,” the bank said. “We have more ground to cover and we are not pausing, that’s extremely clear,” ECB President Christine Lagarde said during a presser (watch, runtime: 53:18).

EGX30	17,295	0.0% (YTD: +18.5%)
USD (CBE)	Buy 30.83	Sell 30.96
USD at CIB	Buy 30.85	Sell 30.95
Interest rates CBE	18.25% deposit	19.25% lending
Tadawul	11,119	+0.4% (YTD: +6.1%)
ADX	9,706	+0.3% (YTD: -5.0%)
DFM	3,583	-0.2% (YTD: +7.4%)
S&P 500	4,136	+1.9% (YTD: +7.7%)
FTSE 100	7,778	+1.0% (YTD: +4.4%)
Euro Stoxx 50	4,340	+1.3% (YTD: +14.4%)
Brent crude	USD 75.30	+3.9%
Natural gas (Nymex)	USD 2.14	+1.7%
Gold	USD 2,024.80	-1.5%
BTC	USD 28,850	-2.2% (YTD: +74.9%)

THE CLOSING BELL-

The EGX30 was flat at Wednesday’s close on turnover of EGP 1.68 bn (5% below the trailing 90-day average). Regional investors were net buyers. The index is up 18.5% YTD.

In the green: Ibnsina Pharma (+6.4%), Taaleem (+3.2%) and Sidi Kerir Petrochemicals (+1.9%).

In the red: e-Finance (-2.3%), Oriental Weavers (-2.1%) and Orascom Construction (-2.1%).

CALENDAR

APRIL

26 April - 5 May (Wednesday-Friday): African Basketball Championship.

Late April – 15 May: 1Q2023 earnings season.

MAY

7 May (Sunday): Senate back in session.

7-11 May (Sunday-Thursday): First round of applications for sixth phase of export subsidy program.

9 May (Tuesday): House back in session.

9-11 May (Tuesday-Thursday): First edition of the Arab Actuarial Conference, Cairo.

12-15 May (Friday-Monday): Egypt Fashion Week.

14 May (Sunday): First National Dialogue session.

14 May (Sunday): Expat car import scheme ends.

14 May (Sunday): EgyptAir to launch a new route to Dhaka, Bangladesh.

14 May (Sunday) Egytrans’ shareholders to vote on NOSCO acquisition.

15 May (Monday): Enterprise Exports & FDI Forum, Four Seasons Hotel Cairo at Nile Plaza.

16 May (Tuesday): National Dialogue session.

16-18 May (Tuesday-Thursday): Egypt will host its first conferenceon cybersecurity and defense intelligence systems (CDIS-Egypt).

17-31 May (Wednesday - Wednesday): Second round of applications for sixth phase of export subsidy program.

18 May (Thursday): National Dialogue session.

18 May (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

19 May (Friday): Arab League summit, Riyadh.

19-21 May (Friday-Sunday): G7 summit, Hiroshima, Japan.

20-21 May (Saturday-Sunday): eGlob Expo, St. Regis Almasa Hotel, Cairo.

22-26 May (Monday-Friday): Egypt will host the African Development Bank (AfDB) annual meetings in Sharm El Sheikh.

29 May (Monday): IEF-IGU Ministerial Gas Forum, Cairo.

30 May (Tuesday): Listed companies have until this date to report and publish their 1Q results.

JUNE

June: Indian representatives to discuss prospect investments in the Suez Canal.

7-10 (Wednesday-Saturday): The second edition of Africa Health Excon.

10 June (Saturday): Thanaweya Amma examinations begin.

12 June - 15 July (Monday-Saturday): Thanaweya Amma exams.

13-14 June (Tuesday-Wednesday): Federal Reserve interest rate meeting.

15 June (Thursday): Deadline for bids in EGPC’s mature oil fields tender.

19-20 June (Monday-Tuesday): The forum for insolvency reforms and corporate restructuring in the Middle East and North Africa.

19-21 June (Monday-Wednesday): Egypt Infrastructure and Water Expo debuts at the Egypt International Exhibition Center.

22 June (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

28 June-2 July (Wednesday-Sunday): Eid El Adha (TBC).

30 June (Friday): June 30 Revolution Day.

30 June (Friday): Egypt to exit Grains Trade Convention.

JULY

1 July: House of Representatives deadline to approve the FY 2023-2024 budget.

1 July: GAFI to launch the country’s first integrated electronic platform to facilitate setting up a business.

5 - 6 July (Monday - Tuesday): Gov’t to pay out subsidies to first wave of applicants under its sixth export subsidy program.

18 July (Tuesday): Islamic New Year.

19 - 20 July (Wednesday - Thursday): Gov’t to pay out subsidies to second wave of applicants under its sixth export subsidy program.

20 July (Thursday): National holiday in observance of Islamic New Year (TBC).

23 July (Sunday): Revolution Day.

25-26 July (Tuesday-Wednesday): Federal Reserve interest rate meeting.

27 July (Thursday): National holiday in observance of Revolution Day.

Late July-14 August: 2Q2023 earnings season.

AUGUST

August: Hassan Allam Utilities + Agility to open Yanmu East logistics park.

2 - 3 August (Wednesday - Thursday): Gov’t to pay out subsidies to second wave of applicants under its sixth export subsidy program.

3 August (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

10 August (Thursday): Shalateen Mineral Resources gold mining tender closes.

22-24 August (Tuesday-Thursday): BRICS summit, Johannesburg, South Africa.

SEPTEMBER

September: Sustainable Debt Coalition Initiative agreed at COP27 to launch.

9-10 September (Saturday-Sunday): G20 summit, New Delhi, India.

15 September (Friday): IMF to review USD 3 bn program.

19-20 September (Tuesday-Wednesday): Federal Reserve interest rate meeting.

21 September (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

21-23 September (Thursday-Saturday): Narrative PR Summit, Somabay.

25 September (Monday): Nasdaq deadline for Swvl Holdings Corp to increase its market value of publicly held shares to a minimum of USD 15 mn.

26 September (Tuesday): Prophet Muhammad’s birthday (TBC).

28 September (Thursday): National holiday in observance of Prophet Muhammad’s birthday (TBC).

OCTOBER

October: Deadline for ins. providers to link their databases with the FRA.

2-5 October (Monday-Thursday): ADIPEC 2023, Abu Dhabi National Exhibition Center.

6 October (Friday): Armed Forces Day.

13 October- 20 October (Friday-Friday): The sixth edition of El Gouna Film Festival (GFF).

Late October-14 November: 3Q2023 earnings season.

26 October (Thursday): Daylight saving time ends.

31 October - 1 November (Tuesday-Wednesday): Federal Reserve interest rate meeting.

NOVEMBER

November: Cairo to hostIntra-African Trade Fair.

2 November (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

15-24 November (Wednesday-Friday): Cairo International Film Festival, Cairo.

DECEMBER

12-13 December (Tuesday-Wednesday): Federal Reserve interest rate meeting.

21 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

EVENTS WITH NO SET DATE

2023: The inauguration of the Grand Egyptian Museum.

2023: Egypt will host the Asian Infrastructure Investment Bank’s Annual Meeting of the Board of Governors in 2023.

Summer 2023: EGX to launch a shariah-compliant index.

1H 2023: GAFI roadshow set to launch to drum up foreign investment for golden licenses

1H 2023: Abu Dhabi Islamic Bank intends to launch a digital consumer finance company

2H 2023: Egyptian government expected to sign agreements with a consultant for the EuroAfrica electricity interconnector.

2H 2023: President Abdel Fattah El Sisi and Turkish President Recep Tayyip Erdogan expected to hold a summit.

4Q 2023: EGX to launch its new futures exchange.

End of 2023: A Developments’ first phase of the Lazoghly development completed.

November 2024: Egypt to host the 12th session of the World Urban Forum (WUF12).

2Q 2025: Safaga Terminal 2 to initiate operations.

Sections

About

Privacy & Support

Get EnterpriseAM daily