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Wednesday, 26 Jul 2023

What We're Tracking Today
Economy
Banking
M&a Watch
Privatization
Economy
Moves
Last Night’s Talk Shows
Also On Our Radar
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IMF sees lower growth, sharply higher inflation in Egypt next year

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Today at a glance

1

Economy

IMF sees lower growth, sharply higher inflation in Egypt next year.
2

Banking

Banque Misr + NBE are back with another round of USD certificates to draw new FX.
3

M&A WATCH

Military acquires 20% of Taqa Arabia; Qalaa has re-purchase option.
4

Privatization

National Paints Holding now owns 100% of Pachin + a real estate M&A may be in the works.
5

Economy

Current account deficit narrows in 3Q 2022-23.
6

Moves

AXA Egypt has a new CEO as Kandeel takes international role.
7

What We're Tracking Today

El Sisi to hold talks with Vladimir Putin tomorrow.
8

What We're Tracking Today

Federal Reserve to announce interest rate decision this evening.
9

HARDHAT

With an eye to attract more tourism, Egypt is making it easier for yacht owners to visit.

Wednesday, 26 Jul 2023

What We're Tracking Today
Economy
Banking
M&a Watch
Privatization
Economy
Moves
Last Night’s Talk Shows
Also On Our Radar
Planet Finance
Diplomacy
Hardhat
Calendar
1

What We're Tracking Today

Federal Reserve to announce interest rate decision this evening

Good morning, wonderful people, and welcome to an unusually brisk news day for a hot, muggy summer morning.

Driving the agenda here at home this morning: If your thoughts (like ours) are starting to turn to your 2024 budget process, you’re going to want to read this morning’s lead story. The IMF might be holding its growth forecast for Egypt steady, but it’s changing course on inflation: Its latest forecast sees prices rising faster in 2024 than they did this year, a development that could see all of us looking ahead to another year of rising wage (and other) costs.

Also making headlines: The Big Two state-owned banks are about to come out with new USD certificates of deposit, a military-affiliated institution has taken 20% of Taqa Arabia (though Qalaa Holdings has a re-purchase option), and more.

PSA- The current heat wave will last through tomorrow, E gyptian Meteorological Authority spokesperson Manar Ghanem told Kelma Akhira last night ( watch, runtime: 2:10). “By Friday night, we will start to feel wind activity making temperatures cooler,” she said.

Our favorite weather app suggests a more … nuanced picture: The 14-day forecast sees the mercury at 43°C today and tomorrow in the capital city, 44°C on Friday and then 38-39°C Sunday, Monday and Tuesday before it spikes back into the low 40s through.

HAPPENING TODAY-

Can we expect to hear something from the government today about the power crisis that has seen rolling blackouts sweep much of the nation? Nighttime talk show host Amr Adib had suggested earlier this week that the government would hold a press conference by today to provide updates on how it plans to address the electricity shortages and when it expects normal service to be resumed.

C hatter in the local pre ss is that the Electricity Ministry is earmarking some EGP 2 bn to cover mazut imports to fire generation plants in a bid to partially make up for the shortfall in natural gas that sees generation well behind current demand. Government sources told us earlier this week that they plan to import increased quantities of fuel oil to plug the shortfall of gas supplies responsible for the blackouts.

It’s Fed day: The US Federal Reserve will announce its decision on interest rates this evening following the end of its two-day policy meeting.

It’s looking like a rate hike: Predictions see the Fed resuming its tightening cycle by raising rate another 25 bps. The Fed “does not want to be head-faked by the recent deceleration in inflation and declare victory too soon,” KPMG’s Diane Swonk wrote in a note cited by Reuters. The expected hike would take the fed funds rate target range to 5.25-5.5%, the highest since the aftermath of the dot-com bust in 2001, and comes in the wake of optimistic inflation that showed consumer prices growing at their slowest rate since March 2021.

The Central Bank of Egypt will next pick up the question a week from tomorrow when its Monetary Policy Committee meets to review rates . We’ll be out with our customary pre-MPC poll on Sunday.

HAPPENING THIS WEEK-

El Sisi-Putin talks tomorrow: President Abdel Fattah El Sisi will be in St. Petersburg tomorrow and Friday to attend the Russia-Africa summit, according to Russian media, which say that he will hold talks with President Vladimir Putin tomorrow. Putin will also reportedly be meeting with Ethiopian PM Abiy Ahmed, who last week agreed with El Sisi to accelerate efforts to find a solution to the long-running GERD dispute.

´The future of the grain pact will be near the top of the agenda for African delegates: African heads of state will discuss with Putin on Friday Moscow’s recent decision to pull out of the grain export pact with Ukraine, a move which threatens to provoke a fresh food crisis among African nations reliant on imports of Ukrainian wheat, Reuters reports.

Russia has moved to reassure African nations in recent days, with Putin pledging to continue to provide grain and fertilizer, and a Kremlin foreign policy aide emphasizing that Moscow isn’t ruling out a return to the pact, provided its demands are met.

HAPPENING NEXT WEEK-

The National Dialogue is back next Sunday: The dialogue is resuming its general sessions starting Sunday, with get-togethers planned on political rights, trade unions, and local administration, Dialogue General Coordinator Diaa Rashwan told Hadith Al Akhbar ( watch, runtime: 8:48). On Tuesday, the dialogue will discuss public debt and social justice, while Thursday’s sessions will focus on cultural industries and post-divorce issues.

The dialogue committees yesterday met to discuss the recommendations brought up during previous sessions regarding parliamentary elections, according to a statement. The dialogue kicked off in May, holding three weekly sessions discussing political, economic, and social issues.

THE BIG STORIES ABROAD-

There’s no single story dominating the global front pages this morning: Bloomberg and the Washington Post are still leading with the escalating political crisis in Israel, the Wall Street Journal and CNBC are looking ahead to this evening’s Federal Reserve rate decision, and the New York Times and the Associated Press are focused on US immigration policy.

AND- China has recycled its foreign minister (kinda). Foreign Minister Qin Gang is unceremoniously out after a month of silence, replaced by veteran diplomat (and former foreign minister) Wang Yi. Reuters and the New York Times are reading the tea leaves.

Also capturing the world’s imagination: It costs a lot to play with AI. Reuters, the Financial Times, and the Wall Street Journal all have front-page looks at how costs are rising sharply at Microsoft and Google as they dip their toes into the next frontier of computing.

MUST READ- The Economist is just a little bit apprehensive about where Western markets are heading, noting that the AI boom has “turned into an everything boom” and wondering if we’re not in a “euphoria” stage that signals the beginning of the end of the bull market. Read: Investors are seized by optimism. Can the bull market last?

WATCH THIS SPACE #1- It looks like we are sidestepping an ecological disaster that could have wiped out Red Sea tourism. The United Nations has stepped up, having launched yesterday a salvage operation off the coast of Yemen to drain oil from the FSO Safer. The USD 140 mn operation aims to prevent a disaster that would have dwarfed the Exxon Valdez spill: The rapidly-deteriorating Safer contains about 4x the amount of oil.

The op to drain the oil could take 19 days — and avert what the UN thinks would have been a USD 20 bn cleanup. The Safer and its 1.1 mn barrels of oil have been stranded on the coast of Yemen — the civil war has prevented it from being maintained. ( UN | CNBC | Associated Press)

WATCH THIS SPACE #2- Countries around the world are stockpiling Indian rice, many in a panic, after the world’s largest rice exporter banned the international sale of non-basmati rice on the back of concerns about supply. Canada’s CBC has more.

CIRCLE YOUR CALENDARS- The Enterprise Finance Forum is taking place on 18-19 September at the St. Regis Hotel in Cairo. This flagship forum is the latest in our must-attend series of invitation-only, C-suite-level gatherings that allow senior members of our community to openly and frankly discuss critical issues in key sectors of the economy.

TAP OR CLICK HERE if you want to express interest in attending. We’ll be sending out the first batch of invitations soon.

Do you want to become a commercial partner? Ping a note to Moustafa Taalab, our head of commercial, or fill out this form and we’ll be in touch.

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

*** It’s Hardhat day — your weekly briefing of all things infrastructure in Egypt: Enterprise’s industry vertical focuses each Wednesday on infrastructure, covering everything from energy, water, transportation, and urban development, as well as social infrastructure such as health and education.

In today’s issue: New changes aim to make yacht tourism a bigger source of foreign exchange.

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2

Economy

IMF sees lower growth, sharply higher inflation in Egypt next year

IMF holds Egypt growth outlook:The IMF left its 2023 growth forecast for Egypt unchanged in its latest projections released alongside its updated World Economic Outlook (pdf). The Fund is still expecting growth to slow to 3.7% this year from 6.7% in 2022, a forecast initially made in April.

2024 growth downgraded: The Fund now expects the economy to expand at a 4.1% clip next year, down from its 5.0% forecast in April. “This lower growth in 2024 is mostly because of the lack of [foreign exchange rate] flexibility and the shortages that have developed in the FX market in Egypt, which is making it difficult for imports to happen. It also has dampened investor confidence,” Petya Brooks, the deputy director of the IMF’s research department, told reporters yesterday.

The IMF now expects inflation to remain 30%+ through 2024: The IMF is now projecting inflation to average 24.4% this year a nd rise further to 32% in 2024. This is a significant shift from its April forecast which saw inflation averaging 21.6% this year and slowing to 18.0% in 2024. “A big part of that is because of the depreciation of the currency and all of this underpinning our advice to have policies which restore the macroeconomic balances,” Brooks said. “Perhaps the most important thing is to allow more flexibility in the FX market.”

REMEMBER- Inflation accelerated at a record pace in June as the impact of multiple currency devaluations combined with higher seasonal demand to send food prices soaring. Annual urban rate of inflation rose to 35.7% y-o-y during the month.

THE GLOBAL OUTLOOK-

IMF gives slight upgrade to global forecast: The IMF revised upwards its 2023 global growth outlook by 0.2 percentage points to 3.0% from the 2.8% April forecast in the report. Despite the revised figures, the forecast is significantly below 2022’s 3.5% growth rate.

No cause for celebration: The 2023 forecast “remains weak by historical standards,” the IMF wrote in the report. “Many challenges still cloud the horizon, and it is too early to celebrate,” IMF chief economist Pierre-Olivier Gourinchas wrote in an accompanying blog post (pdf), noting that tighter financial conditions and higher inflation are weighing on global economic activity. “Stronger growth and lower inflation than expected are welcome news, suggesting the global economy is headed in the right direction. Yet, while some adverse risks have moderated, the balance remains tilted to the downside,” he added.

Inflation is coming down, slowly: The fund is now forecasting global headline inflation to fall to 6.8% in 2023 from 8.7% in 2022. During its April forecast, the fund had predicted global inflation to fall to 7.0%. “Monetary policy tightening is expected to gradually dampen inflation, but a central driver of the disinflation projected for 2023 is declining international commodity prices,” the IMF wrote. Core inflation — which excludes volatile food and energy prices — “is proving more persistent than projected,” it said, penciling in a 6.0% core rate for 2023, down from 6.5% last year.

Sharp Saudi slowdown drags down MENA outlook: The IMF trimmed its MENA growth outlook by 0.5 percentage points, and now expects growth to slow to 2.6% this year from 5.4% in 2022. Growth estimates for 2024 were also downgraded to 3.2% from 3.4% in April.

Why is Saudi going to grow slower? The IMF attributed the region’s growth decline to a “steeper-than-expected growth slowdown” in Saudi Arabia, where GDP is expected to fall from 8.7% in 2022 to 1.9% this year due to its cuts to oil production.

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3

Banking

Egyptian state lenders launch new round of USD saving certificates amid FX crisis

The Big Two introduce new USD CDs: State-owned banks Banque Misr and the National Bank of Egypt will today launch two new USD certificates of deposit as they look to shore up reserves of hard currency.

What’s on offer: The two lenders are offering two three-year certificates: one with a 9% annual percentage rate that pays out interest in EGP up front and another with a 7% rate that pays out in USD quarterly, they said in separate statements yesterday ( here and here — pdfs). Savers will have to deposit at least USD 1k to be eligible for the certificates, which will be repaid in USD when they reach maturity.

This is all to draw new FX into the banking system: The new CDs are designed to attract FX “especially from remittances, which have been declining recently,” economist Mona Bedeir told Enterprise. The NBE expects to draw more than USD 4 bn in fresh FX from the issuance, NBE Deputy Chairman Yehya Aboul Fotouh told Ala Mas’ouleety last night ( watch, runtime: 20:31).

Remittances are down despite booming GCC economies, suggesting that many Egyptians working abroad are sending cash back through informal means rather than through the banking system.

Remember: Egypt has been suffering a prolonged FX crunch triggered by the global shoc k caused by Russia’s war in Ukraine and rising interest rates. The EGP has lost almost half of its value against the greenback since March 2022, fuelling a resurgent parallel currency market that has placed further pressure on FX liquidity in the banking system.

ALSO- The 7% CDs will unlock soft EGP loans: Both state-owned banks attached a loan option to the 7% certificates that allows savers to take a local-currency loan equal to 50% of the deposit — up to a maximum of EGP 10 mn — at a subsidized interest rat e 2.25% below the central bank lending rate.

BUT- There are strings attached: “The loan has to go towards another certificate of deposit, a real estate investment, or a vehicle purchase,” Banque Misr Chairman Mohamed El Etreby told Yahduth Fi Masr last night ( watch, runtime: 6:37).

Egyptians have appetite for USD CDs: Savers have poured some USD 3.5 bn into the NBE’s previous three-year USD CDs, Aboul Fotouh said on Ala Mas’ouleety .

The CDs are also open for Egyptians abroad: Egyptians living abroad will also have the chance to invest in the CDs, Aboul Fotouh said.

No questions asked: The bank will not ask any questions about the source of the hard currency, regardless of the amount , he said.

An EGP loan for Egyptians abroad: The banks are also offering Egyptians who work abroad EGP loans of up to EGP 3 mn at a rate 2.25% below the corridor rate to be paid back in whatever currency they are paid in, El Etreby told Kelma Akhira ( watch, runtime: 18:51). The banks are also offering mortgage loans for Egyptian expats, in return for a 20% down payment to be paid in foreign currency.

The move received international attention: Bloomberg | Reuters | Xinhua.

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4

M&A WATCH

The Egyptian military’s National Service Projects Organization acquires 20% of Taqa Arabia

We now know who snapped up a significant minority stake in Taqa Arabia this week:The military’s National Service Projects Organization(NSPO) acquired a 20% stake in recently-listed Taqa Arabia for EGP 1.6 bn this week, according to a regulatory filing (pdf) by EFG Hermes Securities Brokerage yesterday. The EGX had said on Monday that 270.5 mn Taqa shares had been sold in a block trade, without disclosing the identity of the seller or the buyers.

Qalaa was the seller: Silverstone Capital Investments — an entity controlled by Taqa parent Qalaa Holdings — sold the shares to the NSPO, according to the disclosure. It sold the stake to make debt payments to one of its creditors.

Silverstone has now sold more than 50% of Taqa this month: Silverstone now owns 29% of the high-profile energy company, down from 80% earlier this month. It sold 386.2 mn shares to Financial Holdings Investments and Rimco EGT Investments in a block transaction on its market debut on 9 July, reducing its ownership to 49%.

The military got the shares at a discount: The NSPO purchased the shares at EGP 6.02 apiece, a 46% disc ount to the company’s closing share price on Thursday and 32% below the fair value estimate.

Qalaa can rewind: It has the right to repurchase the shares within four years of the transaction under a stock repurchase agreement.

Market reax: Taqa shares fell 3.8% to EGP 10.54 during trading yesterday.

The sale deepens the NSPO’s footprint in the energy sector (at least temporarily): The NSPO owns nationwide fuel retailer Wataniya. The company has been slated for privatization, and unconfirmed reports in the press have claimed that several Gulf investors are interested in acquiring a stake.

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5

Privatization

Dubai’s National Paints Holding now owns 100% of Pachin. PLUS: Are two state-owned real estate developers merging?

We have two pieces of M&A news for you folks this morning. One story closes the loop on a much-discussed transaction, the other could set up a new one:

#1- NPH now owns 100% of Pachin: Dubai-based National Paints Holding (NPH) acquired the 20% of EGX-listed Paint and Chemical Industries (Pachin) that it didn’t already own for EGP 9.21 mn on Monday, according to an EGX bulletin picked up by Zawya. The company purchased 231.6k shares for EGP 39.80 apiece, giving it 100% ownership of the company.

Remember: NPH acquired over 80% of the state-owned company for around EGP 770.5 mn in May. This was the first state asset to be sold under the government’s renewed privatization drive.

A REAL ESTATE MERGER?

Two state-owned real estate developers could be merged: The government is considering merging Maadi Development and Construction and El Nasr Housing and Development ahead of selling shares to a strategic investor, Asharq Business reported yesterday, citing two sources with knowledge of the matter. The people told the news outlet that the Sovereign Fund of Egypt proposed the merger to the government, which is reportedly waiting for both companies to issue their financial statements for 2022-2023 before determining their valuations ahead of a potential merger.

Remember: The companies, both subsidiaries of the Holding Company for Construction and Development, are both on the list of 32 state-owned companies in which the Madbouly government plans to sell stakes over the next year. We heard in March that the companies are planning to bring on outside investors via capital increases, rather than by selling existing shares.

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6

Economy

Egypt’s current account deficit narrows in 3Q 2022-23

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7

Moves

AXA appoints new Egypt CEO — Omar Shelbaya steps up as Ayman Kandeel gets international role

Omar Shelbaya( LinkedIn) has been named as AXA Egypt’s new CEO, r eplacing Ayman Kandeel( Linkedin) who has been promoted to an international role, according to a company statement (pdf) out yesterday. Shelbaya will start in his new role on 1 September after Kandeel takes up a leadership position in AXA International Markets, the company said. Shelbaya has been at the company for the past eight years and enters the role after serving as its chief distribution officer. He has over 27 years of experience in the insurance industry. With 25+ years of experience in the industry, Kandeel has been with the firm for 8.5 years and has been its CEO since mid-2018.

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8

LAST NIGHT’S TALK SHOWS

Egyptian talk shows cover the new USD CDs + when can we expect the weather to cool down

It was a two-topic night on the airwaves last night as the nation’s talking heads dissected the new USD certificates of deposit announced by the National Bank of Egypt and Banque Misr yesterday and opined on the ongoing heat wave hitting the country.

NEW CERTIFICATES TO PULL IN FX-

The news in brief: From today, the two state-owned banks will offer their customers two new USD-denominated certificates as they look to encourage savers to deposit their hard currency in the banking system and ignore the black market.

NBE + Banque Misr chiefs were on the media circuit: Banque Misr Chairman Mohamed El Etreby joined Kelma Akhira ( watch, runtime: 18:51), Yahduth Fi Masr ( watch, runtime: 6:37), and Masa’a DMC ( watch, runtime: 11:46) to brief them on the new CDs. NBE Deputy Chairman Yehya Aboul Fotouh joined Al Mas’ouleety ( watch, runtime: 4:34 | 3:25) and Kelma Akhira ( watch, runtime: 11:23).

EUR CDs next? “We could consider EUR certificates but the interest rates would be lower. The interest rate on EUR is globally lower than that on the USD,” El Etreby told Masa’a DMC’s Ramy Radwan.

Banque du Caire IPO in 1Q 2024? The government will “hopefully” move forward with the long overdue Banque du Caire stake sale during the first quarter of next year, El Etreby told El Hadidi ( watch, runtime: 0:44). The bank was added to the Sovereign Fund of Egypt’s pre-IPO fund back in January ahead of preparations for its listing on the EGX and sale to strategic investors. The bank was among three financial institutions earmarked for sale in the government’s privatization strategy unveiled earlier this year.

It’s been a long time coming: The state has wanted to sell a stake in the bank since 2016 but has pulled back multiple times due to poor market conditions.

^^ We have the full details in the news well, above.

FEELING HOT HOT HOT-

Most of the nation’s talking heads commented last night on the ongoing heatwave sweeping the country that has triggered rolling blackouts due to soaring electricity demand. Environment Minister Yasmine Fouad was on Yahduth Fi Masr ( watch, runtime: 5:30) to discuss climate change while Kelma Akhira ( watch, runtime: 2:10), Masa’a DMC ( watch, runtime: 4:02) and Al Hayah Al Youm ( watch, runtime: 1:35) also discussed the temperatures

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9

Also on our Radar

Fawry confirms Saudi talks, kicking tires on digital banking license in Egypt

FINTECH-

Fawry in talks to set up in KSA: Egypt’s leading e-payments player Fawry has entered preliminary talks with the Saudi central bank to obtain a license to operate in the country, it confirmed in a statement (pdf). “The discussions are in line with the company’s long-term regional expansion plans into the GCC and are expected to culminate in a final assessment by year-end,” the company said. CEO Ashraf Sabry told Asharq Business earlier this month that the company is looking to enter the country.

Fawry is also looking into whether it wants to throw its hat into the digital banking ring in Egypt when the central bank gives the OK to the still-nascent sector.

HEALTHCARE-

Egypt could set up its first blood bag factory with private-sector help: Public Enterprises Minister Mahmoud Esmat discussed setting up Egypt’s first blood bag and blood transfusion supplies factory with a number of Unified Procurement Authority yesterday, the Public Enterprises Ministry said in a statement. The factory will be established by the authority, the Holding Company for Pharma Industries (HoldiPharma), two private-sector players, and an unnamed Japanese company. The factory will aim to fulfill local market needs, with the rest going towards exports to neighboring countries.

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10

PLANET FINANCE

Output cuts are taking their toll on Saudi oil income

Saudi oil revenues fell to their lowest level since September 2021 in May as voluntary production cuts and lower oil prices hit the country’s hydrocarbon exports, Bloomberg reports. The country brought in USD 19.2 bn in oil receipts during the month, down from USD 22.3 bn in May, according to figures from the country’s statistics authority.

Cheap debt catches up with US companies as rates rise: The US junk loan market has been hit with 120 downgrades in 2Q 2023 as rising interest rates place strain on companies that overindulged in recent years of cheap debt, reports the Financial Times, citing JPMorgan analysis. The Federal Reserve’s policy response will direct the potential for future downgrades, with some analysts recasting their predictions of a recession. Goldman Sachs now gives a 20% chance of recession in the next 12 months, down from 25% previously.

Positive data from the US: US consumer confidence hit a two-year high in July on the back of lower inflation and a tight labor market. ( Statement)

EGX30

17,480

-0.4% (YTD: -19.7%)

USD (CBE)

Buy 30.85

Sell 30.96

USD at CIB

Buy 30.85

Sell 30.95

Interest rates CBE

18.25% deposit

19.25% lending

Tadawul

11,883

+0.7% (YTD: +13.4%)

ADX

9,727

-0.1% (YTD: -4.7%)

DFM

4,015

+0.5% (YTD: +20.4%)

S&P 500

4,567

+0.3% (YTD: +19.0%)

FTSE 1 00

7,692

+0.2% (YTD: +3.2%)

Euro Stoxx 50

4,391

+0.2% (YTD: +15.8%)

Brent crude

USD 83.28

+0.7%

Natural gas (Nymex)

USD 2.73

+1.7%

Gold

USD 2,005.50

+0.2%

BTC

USD 29,228

+0.3% (YTD: +76.8%)

THE CLOSING BELL-

The EGX30 fell 0.4% at yesterday’s close on turnover of EGP 1.62 bn (15.9% below the trailing 90-day average). Local investors were net sellers. The index is up 19.7% YTD.

In the green: Ezz Steel (+5.7%), Edita (+1.1%) and Mopco (+0.9%).

In the red: Qalaa Holdings (-3.6%), Credit Agricole Egypt (-3.4%) and Ibnsina Pharma (-3.1%).

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11

Diplomacy

Egypt summons Swedish diplomat to condemn Quran burning

Egypt condemns Quran burning: Egypt’s foreign ministry summoned Sweden’s chargé d'affaires in Cairo to condemn the burning of Qurans by anti-Islam protesters in Sweden and Denmark, it said in a statement yesterday. The latest incident saw five anti-Islam activists burning a copy of the Quran in front of the Egyptian embassy in Copenhagen. Reuters also had the story.

Madbouly x International Organization for Migration: Prime Minister Moustafa Madbouly discussed refugees and immigration with Amy Pope, director-general of the International Organization for Migration, on the sidelines of the International Conference on Migration and Development in Rome on Monday, cabinet said.

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Our weekly deep-dive into infrastructure in Egypt.

Published every Wednesday in EnterpriseAM.

Read Hardhat
12

HARDHAT

With an eye to attract more tourism, Egypt is making it easier for yacht owners to visit

We’re doing more to attract yacht tourism: The government has been working to boost Egypt’s yacht tourism since last year, in a bid to secure a source of FX inflows and capitalize on the burgeoning industry. After rolling out a digital platform to cater to tourists looking to enter Egypt via yacht, we’re now simplifying regulations and procedures even further to make it easier — and more attractive — for yacht owners to come to Egypt. These moves have the potential to significantly improve our standing as a yacht tourism destination, provided they’re implemented correctly, our industry sources tell us.

REMEMBER- Yacht tourism can bring in much-needed foreign currency, considering that it’s wealthy individuals who own or have access to yachts. The daily spend of those visiting Egypt via yachts is 94% more than the average tourist, former Tourism Minister Khaled El Anany previously said. Yacht tourism provides a great window to double the tourism spending of those visiting from the Gulf, tourism industry sources previously told us. Half of global nautical tourism is concentrated in the Mediterranean alone, which draws in over 30k yachts a year, according to the State Information Service (SIS). European countries overlooking the Mediterranean are currently dominating the yacht tourism sector, attracting an annual USD 150 bn from the sector.

We have plenty of marinas and ports to cater to the influx of yachts: Egypt currently has tens of yacht marinas and berths. It is also home to the North Coast’s 500-berth Porto Marina Resort, which overlooks the Mediterranean sea and can accommodate over 1.4k yachts. It is the first international yacht marina in the eastern part of North Africa. Also on the North Coast, the c.EGp 24 bn Marassi Marina and Yacht Club, courtesy of Emaar Misr, was inaugurated last summer. The coast’s first international marina has the capacity to accommodate over 260 yachts. We also have Hurghada Marina, which can accommodate around 188 yachts at a time. Egypt is also home to the Taba Heights Marina, which can accommodate up to 50 yachts and provide them with maintenance services as well, and El Gouna’s Abu Tig Marina and Sharm El Sheikh’s Marina Naama.

And now it’s easier for yachts to enter, stay in, and exit the country: Tourist yachts will now be able to receive entry permits to Egypt through the Transport Ministry’s digital platform for tourist yachts within 30 minutes, instead of the previous processing period of 15-30 days, the ministry said earlier this week. The new rules also allow all passengers to receive electronic tourist visas as part of the same process, with the platform now linking to the Interior Ministry’s passports and immigration administration. Tourists entering the country via yachts will now also be granted three-month visas, up from the previous 30-day expiry period, to accommodate longer trips, according to a ministry statement. Yachts will also be allowed to exit Egypt from any port, instead of previous regulations that required them to exit from the same point of entry.

The process has gone digital: Back in 2021, the Transport Ministry introduced a digital platform for tourist yachts to act as a one-stop-shop to manage and issue all the necessary approvals and permits. The digitization of the permit process was designed to eliminate the previously existing hassle of navigating a complicated web of bureaucracy, which industry insiders told us had been among the biggest complaints from yacht owners. Yacht owners can now apply for entry and mooring permits by uploading the required documents and providing their planned itinerary for the trip through the digital platform, which is standard procedure for most countries where yacht tourism is booming.

How does it work? The ministry has a step-by-step video to guide yacht owners on the process of applying for the permits and visas they’ll need to enter Egypt with their yacht ( watch, runtime: 11:37). The process requires them to provide certain information and documentation on the digital platform website — including details about the yacht and providing an ownership document, the planned itinerary for the trip, residency information for the yacht’s owner, crew, and other passengers, as well as declaring any cargo or wireless devices on board. Once this information is uploaded to the platform, the applicant will be required to pay the necessary fees — including mooring fees, which the ministry has now unified for all ministry-owned ports — and issue a payment receipt.

These updates could be a major boon for the yacht tourism industry, but it all depends on implementation: The ministry’s recent regulation changes could help put Egypt’s yacht tourism on the same playing field as regional leaders in the industry, said Ibrahim El Dessouky, head of the Federation of Egyptian Industries’ Maritime Transport division . However, the success of these regulations will depend on whether or not they are properly implemented, El Dessouky said, noting that some processes — such as getting clearance to bring in certain short-range wireless devices — can take as long as two months.

Your top infrastructure stories for the week:

  • Qalaa, Axens to study production of green fuels: Qalaa Holding, its waste management company ECARU, and French low-carbon energy company Axens will carry out joint research into producing green fuel in Egypt.
  • Japanese water pump maker to set up in the SCZone: Torishima Pumps will establish a USD 5 mn water pump factory in the Suez Canal Economic Zone.
  • Japanese manufacturer Yazaki will begin construction of its EUR 30 mn factory in Fayoum’s first freezone after signing land contracts with local authorities.
  • More golden licenses granted: The Madbouly Cabinet gave its preliminary approval to grant five new golden licenses.
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CALENDAR

JULY

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

27-28 July (Thursday-Friday): Russia-Africa summit, St. Petersburg.

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.

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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