EBRD to lend USD 532 mn to state-owned banks, impact investor Mediterrania

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What We're Tracking Today

BlackRock wants to invest here. PLUS: Ethiopian PM lands in Egypt ahead of Sudan peace summit

Good morning, wonderful, people, and a very happy THURSDAY. We’re ending a busy news week with another packed issue, bringing you stories on everything from fresh international development finance to our roundup of the most important legislation passed by the House of Representatives in its most recent session. But first…

REJOICE- We have a four-day weekend next week: Thursday, 20 July and Sunday, 23 July will be national holidays for the public and private sector to mark the Islamic New Year and Egypt’s Independence Day, according to a cabinet statement. We’ll be keeping our eyes peeled for confirmations from the Central Bank of Egypt and the EGX that the same holidays will apply for the banking sector, and the bourse.

It will be the last long weekend until late September when we down tools for the Prophet Muhammad’s birthday.

THE BIG STORY here at home this morning: We’re getting a ton of EBRD money. Two state-owned banks and impact investor Mediterrania Capital Partners are getting more than USD 530 mn in fresh financing from the European Bank for Reconstruction and Development. We have the full story in today’s news well.

SOUND SMART- EBRD has a current portfolio here of some EUR 4.6 bn and has invested more than EUR 10 bn in Egypt since day one. Most of its investment is in private sector companies, and its priorities include the finance industry, agribusiness, infrastructure, transportation, and telecoms.

AND-BlackRock could have more appetite for Egypt. The world’s biggest asset manager is exploring more investment in the Egyptian market, Gordon Fraser (bio), co-head of global emerging markets equities at a division of BlackRock's active equities group, said during a meeting with Prime Minister Moustafa Madbouly yesterday, according to a cabinet statement. Fraser is quoted as saying that the government’s moves to implement its economic reform program had encouraged BlackRock to look into deploying more capital here. EFG Holding chief Karim Awad was also at the meeting.

More to come: BlackRock representatives were also due to meet with the governor of the central bank, officials from the sovereign fund, and private sector firms, the statement reads.

ALSO- Our friends at home-grown shipping giant Transmar have rolled out a new reefer line connecting Egypt’s Adabiya Port with the ports of Aden and Hodeida in Yemen, the company said in a statement (pdf). The route will be biased toward refrigerated and dry cargo to help boost Yemen’s food security, the release added. The service launched at the end of June, head of marketing at Transmar, Angie Mahran, told Enterprise Logistics.

HAPPENING TODAY-

Egypt will today host a peacemaking summit of Sudan’s neighbors to look into ways to put an end to the country’s ongoing civil war. The summit will work to set up “effective mechanisms” to stop the bloodshed in coordination with regional and international players. The leaders of Libya, Chad, the Central African Republic, South Sudan, Ethiopia, and Eritrea are expected to attend, according to the National.

The summit has provided an opening for talks with Ethiopia on GERD: President Abdel Fattah El Sisi last night met Ethiopian PM Abiy Ahmed after the latter landed in Cairo for the Sudan summit, Ittihadiya said in a statement. Sudan and the disputed Grand Ethiopian Renaissance Dam (GERD) were on the agenda. This comes shortly after reports that Egypt and Ethiopia will soon resume talks on the filling and operation of the dam.

The government will wrap up the disbursement of a first batch of export subsidiesunder the sixth phase of its subsidies program, the Finance Ministry said in a statement. FinMin is disbursing EGP 7.5 bn to some 750 exporters yesterday and today, The second tranche will be paid out next week on 19 and 20 July, while the third will be paid on 2 and 3 August.

The program so far: The ministry has so far paid EGP 42 bn to exporters since the program first started in 2019.

WATCH THIS SPACE-

ORA is heading to Iraq: Naguib Sawiris’ ORA Developers wants to launch a “huge” real estate project in Iraq, Sawiris told Asharq Business, without providing any details.

Beltone is close to wrapping its huge capital increase: The landmark EGP 10 bn capital increase is now 98% covered as of the end of its first phase, which closed on Tuesday, Beltone said in a regulatory filing (pdf)yesterday. Some 4.89 mn shares of the 5 mn on offer have been snapped up. The second phase of the capital increase runs today through Monday. Investors welcomed the news, with the company’s shares up 1.0% at the closing bell yesterday at EGP 4.08 apiece.

THE BIG STORY ABROAD-

It’s another morning all about the Nato summit in Vilnius: The international press is yet to shift its focus from the summit, which wrapped up yesterday. Ukraine gained long-term security assurances from the US and its allies yesterday, though they stopped short of allowing Kyiv to join the alliance while the conflict with Russia continues. US President Joe Biden accused Russian President Vladimir Putin of having a “craven lust for land and power” as he reiterated the country’s support for Ukraine. (Reuters | Bloomberg | FT | DW | CNN | Washington Post)

AND- US inflation dipped to 3% in June, the slowest pace since March 2021, according to the Wall Street Journal.

PLUS- The Madbouly cabinet’s big privatization update is still generating international headlines: The government’s announcement that it has secured USD 1.9 bn of asset sales under its privatization program is “a positive sign,” but more needs to be done to stabilize the economy, Abu Dhabi Commercial Bank chief economist Monica Malik told the Financial Times. “To secure wider inflows, Egypt will need to move to a flexible exchange rate. These won’t come as long as the currency is perceived as overvalued,” she is quoted as saying.

MARKET WATCH-

Could Russia regain access to SWIFT in return for an extension of the Black Sea grain pact? The UN has offered that a subsidiary of Russia’s agricultural bank be reconnected to the SWIFT international payment network in return for Moscow agreeing to extend a pact allowing Ukrainian grain safe passage through the Black Sea, sources familiar with the matter are quoted as telling Reuters. Russian banks were locked out of SWIFT as part of sanctions imposed at the outbreak of the war with Ukraine.

REMEMBER- Turkey recently said it wants a further month-long extension of the agreement, which has already been extended for two months and expires on 17 July.

CLARIFICATION-

Here’s what’s happening with Al Ezz Dekheila: In our story covering the government’s sale of Al Ezz Dekheila shares and the company’s planned delisting, we incorrectly identified Ezz Steel as the buyer. Though the company will likely end up acquiring full ownership of its subsidiary following the upcoming shareholder meeting, it was Al Ezz Dekheila that bought the shares.

ICYMI- On Tuesday, the government said that it would sell its entire 31% stake in Al Ezz Dekheila as part of its privatization program. Hours earlier, the company announced that it would be voluntarily delisting from the EGX within three months.

Al Ezz Dekheila is the buyer: Al Ezz Dekheila will use foreign-currency loans to buy back the freefloat shares held by government entities. This will result in the company owning 31% of its shares, while Ezz Steel will hold a 64% stake, and the remainder will be held by minority shareholders. With more than 90% of the company now in private hands, the company plans to voluntarily delist from the EGX, a decision that will be voted on at the 5 August shareholder meeting.

Al Ezz Dekheila plans to retire all of the shares acquired from the government after the transaction. This will leave Ezz Steel with almost full ownership of the now-private company — and potentially 100% control depending on how many of the minority shareholders decide to sell their shares. Shareholders will vote on whether to retire the shares at the 5 August meeting.

An Emirati syndicated loan to fund the buy back: Ezz Steel has secured a USD 125 mnsyndicated facility from a number of Emirati banks to fund part of the buyout, a representative from Ezz Steel told Enterprise, without disclosing the identity of the lenders.

CIRCLE YOUR CALENDAR-

Egyptian BoDs form climate alliance: Launched at a reception yesterday, the Egyptian branch of the global Climate Governance Initiative, Chapter Zero Egypt, aims to educate corporate boards of directors on climate change and equip its members with the tools to help tackle it, Zawya reports.

We’re hosting an environment and climate investment forum at the end of the month, Environment Minister Yasmine Fouad said yesterday during her participation at the Chapter Zero launch. The forum will look into nontraditional forms of climate investment in sectors including ecotourism and agricultural waste..

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

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NBE, Banque Misr, and Mediterrania land some USD 530 mn from EBRD

EBRD goes big: The European Bank for Reconstruction and Development (EBRD) will provide USD 532 mn in soft financing to the National Bank of Egypt, Banque Misr, and impact investor Mediterrania Capital Partners, the International Cooperation Ministry said in a statementyesterday.

#1- NBE to get the lion’s share of the funds:The EBRD will provide USD 400 mn to the state-owned bank, the ministry said, without disclosing how the funds will be deployed.

#2- Banque Misr to on-lend to small firms: Banque Misr will receive USD 100 mn which it will direct to supporting micro, small and medium-sized enterprises (MSMEs). The state-owned bank will focus its lending on businesses located in areas with limited access to financial services. The EBRD signed off on the loan at the end of May, according to its website.

#3- More dry powder for Mediterrania Capital Partners: The European lender will invest EUR 30.2 mn (c. USD 33.6 mn) in theMalta-based impact investor’s Mediterrania MC IV fund, according to the ministry and the EBRD’s website. The fund, which has a EUR 350 mn target close, will invest in mid-cap companies in Egypt, Morocco and Tunisia, focusing on healthcare, retail, financial services and manufacturing sectors, with especially women-owned businesses. The EBRD approved the investment last month after expressing its interest in making a commitment to the fund last October.

The fund has attracted the attention of global DFIs: The International Finance Corporation committed EUR 25 mn in March while the European Investment Bank (EIB) has invested EUR 15 mn.

Next up: the EIB? International Cooperation Minister Rania Al Mashat said this week that the EIB plans to commit EUR 4 bnin financing to Egyptian development projects between now and 2030. The minister did not name specific projects that will receive funding, but said that the government’s flagship Nexus for Water, Food and Energy (NWFE) climate adaptation program will be included.

** Egypt will serve as the vice-chair of the EBRD’s 2024 annual meeting in Armenia, the ministry said.

An end to tax breaks for state companies in Egypt

So the government is removing tax breaks for state firms. Here’s what we know so far:The House of Representatives on Tuesday approved a bill that will scrap tax exemptions previously enjoyed by public-sector companies and state entities. The removal of the preferential tax treatment, long criticized for unfairly privileging the state and hindering the private sector, represents a serious move by the government as it looks to improve the business climate and attract new foreign investment into the country.

The status quo: Most state-owned and military-affiliated companies currently enjoy exemptions from paying a raft of taxes, duties, and fees to the government, giving them an advantage over the private sector, which has struggled to compete.

Leveling the playing field: Under the new bill, all public-sector and state-affiliated entities will be required to pay tax at the same rate as the private sector, ending the preferential treatment that observers have criticized for discouraging private investment.

This includes all taxes: The exemptions set to be scrapped “will incorporate all tax exemptions, including real estate taxes and custom taxes,” Bassam El Zayat, advisor to the parliamentary affairs minister, told MPs earlier this week.

THE CAVEATS-

Certain projects will be ring fenced from the changes: Under the legislation, companies working on projects that are defense- or national-security-related, fall under international agreements, and involve the construction of basic infrastructure will be exempt from all taxes, duties and fees.

We’re still waiting for the fine print: It remains unclear which projects will be considered as basic infrastructure and which will be ring-fenced as defense- and national security-related. We expect to receive more details when the government publishes the executive regulations for the bill in the coming six months.

We also need confirmation that the bill will supersede other legislation: The Madbouly government has asked the State Council (Maglis El Dowla) to rule on whether the new law will automatically supercede all other tax exemptions written into other pieces of legislation, a Finance Ministry source told us. Cabinet hopes it says “Yes,” as it aims to unify tax treatment across all companies and minimize exceptions as much as possible.

The impact on the public purse isn’t clear: A Finance Ministry study estimated that the changes could bring in EGP 100-200 bn in additional tax receipts over the coming five years, according to ministry sources we talked to. However, the study didn’t include state entities whose finances sit outside the state budget, according to House Planning Committee deputy chair Mostafa Salem (watch, runtime: 3:08), making the actual impact on tax revenues unclear.

Remember: Ending the tax exemptions was among the 22 decisions recently approved by the Supreme Investment Council designed to improve the business environment and boost private investment.

What’s next: The bill will be passed to President El Sisi who will sign it into law.

INDUSTRY REAX-

Private-sector players are happy: The bill was a major demand from the private sector, Mohamed Sami Saad, head of the Egyptian Federation of Construction and Building Contractors, told Enterprise. “Redirecting exemptions from entities to projects under certain conditions will rebalance the difference in costs between public and private companies,” he said, adding that they will be forced to be more competitive with the private sector.

Investors, too, were waiting for this step: Investors believe that the bill will improve the private sector’s competitiveness with the public sector, Egyptian Federation of Investors Associations head Moharam Helal told us. “The sector has been calling for such a step for years to achieve competitive neutrality in Egypt’s economy,” he said.

An end to tax exemptions will help equalize costs: The preferential tax treatment has always handicapped the competitiveness of the private sector, which has shouldered costs that are 30% higher than state firms, Mohamed El Bahey, head of the Tax and Customs Committee at the Federation of Egyptian Industries (FEI) told Enterprise. This, “along with high commodity prices and supply chain shortages, have weighed down on the private sector’s profit margins,” he said.

Time is of the essence: “Quick implementation [of the bill] will boost foreign investors’ confidence in returning to Egypt,” El Bahey said.

The key bills passed by Egyptian MPs this session

It's Sahel time for our elected representatives — here’s what they got up to over the past year: The House of Representatives held its final session on Tuesday before breaking for the annual three-month summer recess. Lawmakers passed some 188 bills during the cycle, according to House Speaker Hanafi Gebali. The current legislative session saw measures to boost investment and economic reform at the forefront of our lawmakers’ agendas.

Here’s a rundown of the key bills impacting the business community, the economy, and wider society:

BUSINESS + FINANCE

INVESTMENT ACT AMENDMENTS- Amendments to the Investment Actaim to improvethe investment climate, support private-sector participation, and promote fairness, competition and transparency in the economy. The bill will also allow projects predating the 2017 act to benefit from its incentives and expand eligibility for golden licenses. The amendments are one of 22 moves to reform the business climate proposed by the Supreme Investment Council in its first ever meeting in May.

COMPETITION ACT- Amendments to the Competition Actpassed late last year grant the Egyptian Competition Authority (ECA) the power to block M&As that it believes could be anti-competitive or encourage monopolistic practices.

AUTOMOTIVE LEGISLATION- MPs approved legislation that will see the establishment of a new regulatory body — dubbed the Supreme Council for Vehicle Manufacturing — to set policy for the local automotive industry (including EV assembly), as well as set up a new fund to offer incentives to companies in the business of assembling environmentally-friendly cars. A second piece of automotive legislation that got the go ahead allowed Egyptian expats to import new cars and get an eventual rebate on all related fees if they pay upfront in FX, an initiative that raised USD 900 mn in FX.

SIMPLIFIED PROPERTY REGISTRATION IN NEW CITIES- Amendments to a 2018 law will simplify the real estate registry and notarization process in new cities. Under the changes, owners of property and plots of land in new cities will no longer be required to interact with real estate registry and notarization offices and will only need to submit registration paperwork to the New Urban Communities Authority (NUCA).

INTELLECTUAL PROPERTY AUTHORITY- The House signed off on a bill that willmergeinstitutions currently responsible for regulating intellectual property rights into a single entity. The new body would also be responsible for advancing technological innovation, scientific research and cultural development as part of a wider five-year intellectual property strategy.

CONTRACTOR COMPENSATION BILL- Amendments to the 2017 Contractors Compensationbill will allow construction firms who have suffered losses on state projects due to recent economic reforms to receive compensation from the government. Amendments to the law — which was originally drafted for economic reforms undertaken in 2016 — will be extended to cover all periods of reform.

TAXATION

TAX AND DUTY HIKES- A raft of tax, duty and development fee hikes cleared the House in May. Among the changes:

Income tax: A new 27.5% higher rate of income tax and a higher personal tax exemption threshold.
Entertainment tax: A 5-20% tax on entry to entertainment venues such as theaters, sports events, parks and clubs.
Duties + development fees: New fees on duty-free and luxury goods.

And a (very modest) tax cut: MPs greenlit a reduction in capital gains tax on newly-listed companies to increase investor subscription to IPOs.

TAX EXEMPTIONS- The House of Representatives signed off on a bill that will eliminate tax exemptions for state entities (see story above). The bill is not set to impact projects that are subject to international agreements, are defense- or national-security-related, or involve the construction of basic infrastructure. We have more on that bill in the news well, above.

DABAA TAX EXEMPTIONS- MPs earlier this year approved a bill that would grant taxexemptions to local and international companies involved with the construction of the Dabaa nuclear power plant.

DEVELOPMENT + INFRASTRUCTURE

LOADS OF DEVELOPMENT LOANS AND FINANCING- Bns of USD of fresh borrowing from multilateral lenders was approved by the House for projects spanning climate resilience, infrastructure, and public transit. Some of the largest financing agreements given the greenlight include USD 900 mn of borrowing from the World Bank‘s International Bank for Reconstruction and Development (IBRD) to expand the Takaful and Karama subsidy program and build a railway line between the Port of Alexandria and the Sixth of October dry port; a USD 310 mn loan from the Japan International Cooperation Agency for the universal health ins. scheme; a USD 271 mn loan from the African Development Bank (AfDB) aimed at bolstering food security; and an EUR 250 mn loanfrom the French Development Agency (AFD) for the Alexandria-Abu Qir metro line.

OIL AND GAS EXPLORATION- MPs approved a number of bills greenlighting fresh oil and gas exploration in the Mediterranean and the Western Desert. See here and here.

RIVER TRANSPORT ACT- Amendments designed to draw more investment into the country’s waterways were approved by MPs and signed into law. The changes will open up the river transport sector to private investment and put the River Transport Authority (RTA) in charge of licensing river boats, Nile cruises and floating units.

AGRICULTURE LAW- Amendments to the Agriculture Law will see heftier fines doled out to people caught building on agricultural lands. Penalties range between EGP 500k and EGP 10 mn in addition to up to five years in prison.

EAST PORT SAID PORT DEVELOPMENT- The House approved a bill that allows the Suez Canal Economic Zone to give a 30-year contract to Sky Logistics and Reliance Logistics to design, construct, manage, operate and maintain a new multipurpose terminal worth USD 65 mn at the port. A second bill paves the way for Maersk’s Suez Canal Container Terminal to begin construction on a new USD 500 mn terminal.

SOCIAL + POLITICAL

WAGE AND PENSION HIKES- MPs in March approved measuresthat will raise salaries and the minimum wage for public-sector workers, hike pension payments by 15%, and increase allocations to social protection programs. To make this happen, the House also approved legislative amendments allowing the government to borrow an extra EGP 165 bn for the final quarter of the current fiscal year — EGP 70 bn of which will be used to increase funding to social protection programs and EGP 10 bn designated for wage hikes. The remaining borrowing was used to cover debt repayments through to the end of the fiscal year.

CITIZENSHIP ACT- Amendments to the Citizenship Act make it easier for foreigners to gain citizenship by purchasing assets worth at least USD 300k, or by investing at least USD 350k in local projects and depositing USD 100k into the state treasury. The move comes as part of the government’s efforts to attract hard currency.

DISABILITY FUND- The House approved a billthat will set up an EGP 1 bn fund to support people with disabilities to enter the job market and run SMEs among other forms of social and financial support.

DOG OWNERSHIP REGULATIONS- New legislation passed by the House earlier this yeartightens restrictions on dog ownership, requiring owners to purchase licenses and banning anyone under the age of 18 from walking dogs outdoors unsupervised. The new rules also include fines of at least EGP 10k for people who fail to obtain licenses and fines worth up to EGP 4 mn plus jail time if their dog attacks another person.

CIVIL STATUS LAW- An amendment to the Civil Status Law approved by the House will require citizens to get their national ID cards at 15 years old instead of 16 years old.

AND LAST, BUT CERTAINLY NOT LESAT: FAKE WEATHER NEWS- A bill approved by the House designed to regulate the General Meteorological Authority will impose fines ranging between EGP 100k and EGP 5 mnon those caught spreading “fake weather news” or inaccurate weather reporting.

Chinese companies to invest USD 60 mn in SCZone projects

More Chinese investments are coming to the SCZone: The Suez Canal Economic Zone (SCZone) and a number of Chinese companies have signed agreements to establish projects worth a combined USD 60 mn in investment – including USD 45 mn worth of textiles projects — in China’s TEDA industrial zone in Ain Sokhna, the zone said yesterday.

Who’s investing:

Textile producer Aoxiu Textile is investing USD 25 mn;
A firm namedDew Textile Printing and Dyeing will commit USD 20 mn;
An undisclosed investor will build a USD 10 mn construction curtain wall project;
EV charging stations and switchgears producerKangdewei Electric is committing USD 3.2 mn;
Metals and auto parts producer Zaiyuwill invest USD 2 mn.

Details are scarce: The SCZone statement doesn’t provide any details on the projects, their implementation timelines or expected production capacities.

More Chinese investments to roll in soon: The SCZone in May signed initial agreements with a number of Chinese companies that could see more than USD 700 mn invested in projects in TEDA. Those include a USD 265 mn power plant and a USD 100 mn petcoke products factory from Hidier Power Group, a USD 110 mn bromine factory from Shandong Tianyi, and a USD 20 mn clothing factory from Shanghai Shengda.

The results of a successful roadshow: The investments come following the SCZone’s roadshow in China and Hong Kong in May, where CEO Walid Gamal El Din and his accompanying delegation met with a number of Chinese business leaders and investors in efforts to drum up interest in Egypt.

Egyptian regulator, central bank issue new regulations for fintech, digital banking licenses

New regulations outline clear requirements to obtain fintech and digital banking licenses: The Financial Regulatory Authority (FRA) and the Central Bank of Egypt (CBE) have updated the rules and regs license seekers need to follow in a bid to streamline the process and ensure consistency of process.

UPDATED FINTECH REGS-

The FRA is out with updated regulations (pdf) to the Fintech Act regulating the fintech industry .

More licensing requirements: Fintech providers looking to get licensed by the FRA need to demonstrate they have the right equipment, access to basic facilities and infrastructure, applications and databases to support their activities.

Better protections against fraudulent transactions: Fintech providers need to follow certain security measures and have the means to offer users protection from cybersecurity risks. They also need to prove they have the ability to recover from a security breach.

We knew this was coming: The new regulations flesh out licensing requirements published in brief last year. The requirements were awaiting a decision from the FRA with the new details to become valid.

REMEMBER- The Fintech Act was drawn up by the FRA in 2020, giving the authority powers over licensing and corporate governance in the sector, as well as the power to penalize firms that breach legislation. President Abdel Fattah El Sisi signed the act into law last year.

UPDATED DIGITAL BANKING REGS-

The central bank is out with updated regulations (pdf) to the Banking Act governing digital bank licensing.

New capital requirements for digital banks: Digital banks will now need a capital of no less than EGP 2 bn in order to get their digital banking license, the central bank said. Digital banks looking to take part in financing large companies will need a minimum capital of EGP 4 bn to get their license and need their largest shareholder to be a financial institution with similar experience.

REFRESHER- Specialized banks — AKA digital banks — were initially exempt from complying with the EGP 5 bn in reserve mandated by the law for local commercial banks. The CBE started handing out digital banking licenses last year, following heavy demand from local lenders including the National Bank of Egypt, Banque Misr, Emirates NBD, QNB Al Ahli, and Bank ABC.

Egyptian talk shows cover the latest on remittances + Egypt’s Sudan summit

A busy night on the airwaves after a busy news day: The nation’s talking heads gave us a bit of everything, wrapping up a busy week with a fact check of rumors over remittances and today’s peace summit dor Sudan.

It’s business as usual for remittances: Banks continue to disburse remittances from abroad in the same currency in which they were sent, the Egyptian Banking Federation said in a release seen by Masa’a DMC (watch, runtime: 1:11). The statement came following rumors that banks are forcing beneficiaries of remittances to convert the money received into EGP.

REMEMBER- Remittances from Egyptians abroad fell 10% to USD 28.3 bn last year as people sold FX on the black market or held onto it in expectation of a further EGP devaluation, according to a World Bank report. They are set to rebound this year as the number of Egyptians working abroad picks up following the covid-19 pandemic.

The talk shows sang the praises of the Egyptian efforts to resolve the conflict in Sudan starting with a peacemaking summit of Sudan’s neighbors scheduled for later today. This summit is the ”key to resolving the crisis,” strategist Samir Farag told Salet El Tahrir (watch, runtime: 23:04), highlighting the strong relationship between the two countries. Farag is expecting the summit to result in a ceasefire and to bring the Sudanese Armed Forces and paramilitary Rapid Support Forces back to the negotiating table. Al Hayah Al Youm (watch, runtime: 13:19) and Masa’a DMC (watch, runtime: 12:38) both interviewed Sudanese professionals who voiced the Sudanese nation’s appreciation for Egyptian efforts to resolve the conflict.

Ration cards aren’t going anywhere: A prepaid, unified ration card that will also cover services like health ins. and postal services will not replace the existing ration card, Assistant Supply Minister Ibrahim Ashmawy said during an interview with Sherif Amer on Yahduth Fi Masr (watch, runtime: 10:26). The prepaid card is optional for beneficiaries and will be used alongside ration cards, he said. Masa’a DMC (watch, runtime: 3:04) also had coverage.

AND- Another presidential candidate unveiled: The Republican People’s Party has nominated Chairman Hazem Omar to enter the 2024 presidential election. Ala Mas’ouleety had coverage (watch, runtime: 5:18).

Car distributor Abou Ghaly ties up with the National Bank of Egypt and the UAE’s Metito could build 4 desalination facilities to feed green hydrogen plants

AUTOMOTIVE-

NBE x Abou Ghaly: The National Bank of Egypt (NBE) will start offering clients of Abou Ghaly Motors financing solutions under a partnership inked between the two sides yesterday, according to a statement (pdf). The agreement will allow Abou Ghaly customers to pay for maintenance and auto parts in interest-free installments, while Abou Ghaly will also offer NBE customers exclusive benefits.

INFRASTRUCTURE-

The UAE’s Metito is looking to establish 4 desalination plants here: UAE-based Metito is in talks with private sector green fuels developers to establish four desalination plants that would serve their Egyptian green hydrogen production facilities, Metito Africa Managing Director Karim Madwar is quoted as telling Al Mal. Each of the desalination facilities — all expected to be located in close proximity to planned green fuels plants in Ain Sokhna — would have an annual production capacity of 50k cubic meters. Metito has already established a desalination facility for Scatec and Fertiglobe’s 100 MW green hydrogen plant in Sokhna, Madwar added.

UAE follows KSA to deposit funds with debt-laden Pakistan

First KSA, now UAE moves to support Pakistan: The UAE has deposited USD 1 bn in emergency funding with Pakistan’s central bank to bolster its foreign reserves and help it avert a full-blown debt crisis, Reuters reports, citing Pakistan's Finance Minister Ishaq Dar. This comes a day after Saudi Arabia deposited USD 2 bn into the country’s central bank.

IMF board greenlights Pakistan’s bailout loan: The USD 3 bn provided by the Gulf states equals the stand-by loan Pakistan agreed with the IMF last month, which the Fund’s executive board signed off on yesterday. Some USD 1.2 bn will be immediately disbursed, the IMF board said.

EGX30	17,144	-0.1% (YTD: +17.4%)
USD (CBE)	Buy 30.84	Sell 30.96
USD at CIB	Buy 30.85	Sell 30.95
Interest rates CBE	18.25% deposit	19.25% lending
Tadawul	11,727	+0.5% (YTD: +11.9%)
ADX	9,622	+0.3% (YTD: -5.8%)
DFM	3,987	0.0% (YTD: +19.5%)
S&P 500	4,472	+0.7% (YTD: +16.5%)
FTSE 100	7,417	+1.8% (YTD: -0.8%)
Euro Stoxx 50	4,366	+1.8% (YTD: +14.3%)
Brent crude	USD 80.18	+1.0%
Natural gas (Nymex)	USD 2.63	-3.6%
Gold	USD 1,961.70	+1.3%
BTC	USD 30,333	-0.6% (YTD: +83.3%)

THE CLOSING BELL-

The EGX30 fell 0.06% at yesterday’s close on turnover of EGP 1.49 bn. Local investors were net buyers. The index is up 17.44% YTD.

In the green: TMG Holding (+5.8%), Abu Qir Fertilizers (+1.7%) and Oriental Weavers (+1.5%).

In the red: Qalaa Holdings (-3.5%), Mopco (-3.2%) and Heliopolis Housing and Development (-3.1%).

My Morning Routine: Seif El Sobky, CEO, Koshari Street

Seif El Sobky, CEO and co-owner of the London restaurant Koshari Street:Each week, My Morning Routine looks at how a successful member of the community starts their day — and then throws in a couple of random business questions just for fun. Speaking to us this week is Seif El Sobky (LinkedIn), CEO and co-owner of Koshari Street.

My name is Seif El Sobky and I am the CEO and co-owner of Koshari Street, a healthy Egyptian street food restaurant in London. Our vision at Koshari Street is very simple – we want to take one of Egypt’s most popular and beloved dishes and bring it to the world’s mainstream. There is absolutely no reason why we can’t bring it to the minds of customers in the same way as burgers or pizzas.

We’ve taken an original concept and expanded it while remaining authentically Egyptian. Our menu consists of several Koshari bowls building off of classic Koshari – our best seller. Egypt has so many other beautiful delicacies that I believe can work really well with Koshari, so I started integrating things like my dad’s Golden Halla recipe to create a bowl with slow cooked braised beef, or our Levantine Koshari, which adds molokhia. Most of our bowls are vegan and we also have gluten-free options that use a quinoa base instead of pasta.

Koshari is an ancient meal that can fit every palette. Middle Easterners and Egyptians make up 10-30% of our customer base, but the majority of customers have never tried Koshari before. A lot of Egyptians give us comments like “You’re changing Koshari… You can’t have meat with rice, or chicken with Koshari.” For me, it’s kind of like the pineapple on pizza discussion — it’s a personal philosophy. Food has only one rule: It has to taste good.

My mornings are full of energy to help me take on whatever chaos the day will bring. I try to wake up as early as I can, around two hours before I even start to think about work. I read Enterprise first thing for about 10 minutes before emptying my thoughts through journaling and meditation. Then I plan out the top 10 things I want to get done that day. After that I’ll do an hour of sport and take a cold shower.

My day-to-day work routine varies as I’m doing a bit of everything. Mondays are inspiration days, Tuesdays to Thursdays are for the grind, and Fridays are for tick-box activities. Over the weekend, I try to split my time 80:20 between personal life and work.

I’ll often spend time at the shop taking on a shift, talking to customers to try to see what they’re seeing. If I see a customer looking at the menu for too long, I’ll think, ‘Is the menu not clear enough? Is the concept not simple enough to understand?’ I also ask my team how they are doing and what the pain points are within their workday. I try to observe everything without going into micromanagement. And maybe I’ll get behind the counter and invent a new bowl for myself — sometimes it’s great, sometimes not so much.

I’m currently spending a lot of time looking at properties for new branches. We want to expand within central London with four to five more restaurants next year, whether through franchising or doing it ourselves. The Koshari Street model can be copied and pasted elsewhere — it’s not a high-maintenance service restaurant.

I have a fundamentalist approach when it comes to growing the business. Growth has to come from setting up the unit economics. For every single bowl that I’m selling I know the percentage of the cost that goes on labor, raw materials, energy, utilities and so on. It all has to add up to a bowl that has a price point customers are willing to pay.

Good relationships with suppliers are essential. Outside of the shop I meet with suppliers, even if there’s no specific reason, to build the relationship. Inflation is causing price spikes everywhere and suppliers need to pass the costs down to someone, so strong relationships with suppliers can lead to solutions when you are in a rut.

The most interesting trend I’m seeing in the food industry right now is the polarization in street food. It seems to be either loaded fries, fried chicken, and tacos with a ton of fat on one end of the spectrum, or super healthy, super bland salads that in my opinion taste like water on the other. I’m in no way slamming unhealthy food — I think there’s a place for it, just not every day. Koshari Street finds the middle ground: You get the taste that you want from street food but you also get the right calories, a balanced diet, and energy that helps you avoid the 2pm post-lunch slump.

When I’m really looking to switch off I turn on It’s Always Sunny in Philadelphia: I must have watched it over 15 times and know every episode by heart, so it’s a real comfort watch when I want to get my mind to rest.

My absolute favorite place to eat in London is Brigadiers, an Indian inspired restaurant, but when in Cairo my allegiance will always be to Abou Tarek. Those guys are the best out there in Egypt. They stay true to what they do, the waiters are nice, there’s a great atmosphere, and it just feels very authentic.

One of the best pieces of advice I’ve been given comes from my parents and it's only recently really started to sink in. They always said, ‘There’s no such thing as a problem without a solution.’ Whether with personal or professional problems, it’s always your mission to focus on finding the solution. There’s always an answer, you just have to find the key to solving it.

Someone recently asked me, ‘If you had to choose a project to work on that you knew was going to be a failure, what would it be?’ Initially I didn’t understand the question. But what it was really asking is: ‘What is it that you truly would like to do regardless of whether money is involved?’ I thought about it and I’d do exactly what I am doing now. That’s a philosophy I want to retain.

CALENDAR

JULY

12-13 July (Wednesday-Thursday): Finance Ministry to pay out first batch of export subsidies under sixth phase of subsidies program.

15 July (Saturday): Deadline for EGAS + EGPC bid rounds for gas exploration and development of mature oil fields.

15 July (Saturday): Rollout of the fourth phase of the Egyptian Tax Authority’s e-receipt system.

18 July (Tuesday): Islamic New Year.

18-19 July (Tuesday-Wednesday): Egypt Mining Forum, Nile Ritz-Carlton, Cairo.

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).

22 - 24 July (Saturday - Monday): US Assistant Secretary of State for International Organization Affairs Michele Sison in Egypt.

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.

31 July (Monday): Application deadline for the Smart Green Projects initiative.

31 July (Monday): Emigration Ministry’s Egyptians Abroad conference.

Late July: Egypt’s first Environment and Climate Investment Forum.

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.

September: IDH to open first branch in Saudi Arabia.

September: The Egypt-Germany trade and investment joint conference in Cairo.

September: JETRO’s second delegation arrives in Cairo.

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

10-12 September (Sunday-Tuesday): The International Agricultural Exhibition for Africa and the Middle East, Sahara.

13-14 September (Wednesday-Thursday): Hydrogen Egypt Summit, Nile Ritz Carlton, Cairo.

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

15 September (Friday): Deadline for FX bureaus to comply with new capital requirements.

17-18 September (Sunday-Monday): Arab Security Conference and Exhibition, Nile Ritz Carlton, Cairo.

17-19 September (Sunday-Tuesday): Sharm Rendezvous, Rixos Premium Seagate, Sharm ElSheikh.

18-19 September (Monday-Tuesday): Enterprise Finance Forum, St. Regis Hotel, Cairo.

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.

25-26 September (Monday-Tuesday): Egypt to host the Asian Infrastructure Investment Bank’s annual board meeting, Sharm El Sheikh.

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

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

28-29 September (Thursday-Friday) Medical Tourism Conference, Sharm ElSheikh.

OCTOBER

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

2-4 October (Monday-Wednesday): Sharm Rendezvous - Ins. Market, Rixos Premium Seagate, Sharm ElSheikh.

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

6 October (Friday): Armed Forces Day.

9 October (Monday): The Narrative PR Summit, Somabay Red Sea.

9-11 October (Monday-Wednesday): Arabs Savings and Financial Literacy Conference, Four Seasons Hotel.

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

Late October-14 November: 3Q2023 earnings season.

15-17 October (Sunday-Tuesday): Egypt Automotive Aftermarket Exhibition, Cairo International Convention Center.

26 October (Thursday): Daylight saving time ends.

29-31 October (Sunday-Tuesday): Egypt Energy, Egypt International Exhibition Center.

29 October - 2 November (Sunday- Thursday): Cairo Water Week.

30-31 October (Monday-Tuesday): Intelligent Cities Exhibition and Conference, Dusit Thani LakeView, Cairo.

30-31 October (Monday-Tuesday): Global Business School Network (GBSN), American University of Cairo.

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

NOVEMBER

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

9-15 November (Thursday-Wednesday): Intra-African Trade Fair, Cairo.

14-15 November (Tuesday-Wednesday): Destination Africa, Royal Maxim Palace Kempinski Hotel.

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

19-22 November (Sunday-Wednesday): Cairo ICT, Egypt International Exhibition Center.

23 November (Thursday): Worldview Education Fair, Cairo. (Register here)

30 November-12 December (Thursday-Tuesday): COP28, Dubai.

DECEMBER

10-11 December (Sunday-Monday): eGlobe Expo, St. Regis Almasa Hotel, Cairo.

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

12-14 December (Tuesday-Thursday): Food Africa Expo, Egypt International Exhibition Center.

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.

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.

3Q 2023: E-Finance to launch in Saudi Arabia.

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

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

2024: Standard Chartered Bank to open a branch in Egypt.

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

2Q 2025: Safaga Terminal 2 to initiate operations.

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