305 civilians, including 27 children, were murdered at Friday prayers in what is being widely described as the bloodiest terrorist attack in Egypt’s modern history. The death toll from the attack on Al Rawda Mosque in North Sinai’s Bir El Abd on Friday rose to 305 yesterday, including 27 children, the state news agency reports, citing a statement from the Prosecutor General’s Office. At least 128 others were injured in the attack, when a group of 25-30 gunmen traveling in five vehicles and flying the black and white Daesh flag surrounded the mosque. The attackers opened fire and lobbed hand grenades at worshippers through the windows during the weekly Friday prayer, according to the statement to the prosecutor’s office. Daesh hasn’t officially claimed responsibility for the attack. It is widely believed that the mosque and its worshipers were attacked for practicing Sufi Islam, which Daesh considers heresy.

In a speech on Friday following the attack, President Abdel Fattah El Sisi promised that his administration would respond with the “utmost force.” He centered the attack in the context of Egypt’s war against terror and vowed to intensify efforts to restore security in Sinai. El Sisi issued orders to tighten security “at places of worship and key buildings” and declared three days of nationwide mourning.

El Sisi also instructed officials to begin drafting a comprehensive development plan for the Bir El Abd area, where the attack took place. The president also declared that monetary compensation of EGP 200k will be issued to the families of each of the dead, while those injured will receive EGP 50k each.

You can view the full speech here (watch, runtime: 4:06).

Military in pursuit: Egypt’s military launched airstrikes in the areas around Al Rawda mosque where they believe more militants were hiding out, unnamed security officials tell Reuters. The Air Force had destroyed vehicles of suspected terrorists in the area, according to a statement from the Armed Forces’ spokesperson. Reports are emerging of retaliatory attacks by the Air Force in Rafah at the border with Gaza. Egyptian authorities decided to delay the opening of the Rafah border crossing, which had been scheduled to allow people through for three days starting Saturday, the Palestinian embassy in Cairo announced.

The international community was quick to condemn the attack. UN Secretary General António Guterres and the Security Council referred to the incident as a “heinous and cowardly terrorist attack” in a statement. Similar statements came from leaders across the region and beyond, including Saudi’s King Salman bin Abdulaziz, Jordan’s King Abdullah II, Kuwait’s Sheikh Sabah Al Ahmad Al Sabah, Lebanese Prime Minister Saad Al Hariri, Palestinian President Mahmoud Abbas, Iraqi President Fuad Masum, Cypriot President Nicos Anastasiades, Greek Prime Minister Alexis Tsipras, French President Emmanuel Macron, and the foreign ministers of the UAE, Lebanon, Kuwait, and India.

The White House and US embassy issued statements that “condemn in the strongest terms [the] horrific terrorist attack.” The United States asserted that “there can be no tolerance for barbaric groups that claim to act in the name of faith but attack houses of worship.” US President Donald Trump also told El Sisi in a phone call that Egypt would have full support in stepping up its fight against terrorist groups in the region. “Horrible and cowardly terrorist attack on innocent and defenseless worshipers in Egypt,” Trump said on Twitter. “The world cannot tolerate terrorism, we must defeat them militarily and discredit the extremist ideology that forms the basis of their existence!”

Trump went on to draw the far-fetched link between fighting the terrorists and building his wall on the border with Mexico. He also plugged his Muslim ban. “Will be calling the President of Egypt in a short while to discuss the tragic terrorist attack, with so much loss of life,’’ Trump said Friday on Twitter. “We have to get TOUGHER AND SMARTER than ever before, and we will. Need the WALL, need the BAN! God bless the people of Egypt.’’

International coverage on the crisis varied from recording the testimony of survivors of the attack to “we told you so.” The Associated Press was on the scene with survivors who not only described in vivid detail the carnage of the event, but also the methodical way in which the terrorists carried it out.

Plenty of international outlets focused on Egypt’s strategy in Sinai. “For Sinai experts, the assault sharpened scrutiny of Egypt’s counterinsurgency tactics against a dogged Islamist insurgency that has surged in strength since 2013, after Mr. Sisi came to power in a military takeover,” write Declan Walsh and David Kirkpatrick of the New York Times. The two claim the military’s tactics in Sinai have isolated and alienated the population of the peninsula. The Associated Press’ Hamza Hendawi makes the same point, asking what other options are available to the administration in battling the terrorist insurgency. Meanwhile, the Guardia’s Jason Burke covers the capabilities of the terrorists.

The attack has put a spotlight on Egypt’s Sufi Muslim community, and how more than ever before, Daesh is shifting its strategy from targeting security forces and Christians to other Muslims. “Striking a mosque would be a shift in tactic for the Sinai militants, who have previously attacked troop and police and more recently tried to spread their insurgency to the mainland by hitting Christian churches and pilgrims,” Reuters notes. Interviews with local sources, however, confirmed that some of the worshippers at Al Rawda were Sufi Muslims, which for Daesh made them targets “because they revere saints and shrines, which is for Islamists is tantamount to idolatry.” Bloomberg’s Eli Lake writes “the terror in Egypt on Friday is only the latest grim reminder that Muslims are often the first victims of Muslim fanatics.” The New York Times is running an explainer on who Sufi Muslims are and why extremists and terrorists hate them, while the Associated Press traces the history of Daesh attacks and threats on Sufi Muslims in Sinai.

Al Arabiya is going so far as to state that Al Rawda Mosque had been threatened with an attack one year ago, citing anonymous sources.

IPO WATCH- Airline Nile Air’s IPO is back on, with its CEO Ahmed Ali announcing that it will take place towards the end of 2018, Al Mal reports. The company, which had said it would IPO 30% of its shares this year, had delayed the listing due to macroeconomic developments in 2016 and 2017, including the EGP float, said Ali. The company is also reassessing the stake it plans to put up for sale in light of its recent growth and funding needs to expand its fleet, according to Al Borsa. Ali said that company is auditioning three potential global coordinators for the offering. Media reports had emerged last year that EFG Hermes had been tapped to manage the IPO.

M&A WATCH- The mandatory tender offer for shares of the National Company for Maize Products (NCMP) was executed on Thursday on the EGX. Cairo Three A bought 28.8 mn shares of NCMP at EGP 51 per share for a total value of EGP 1.47 bn.

Automotive Directive to be issued in early 2018? The Automotive Directive will “see the light” in early 2018, Trade and Industry Minister Tarek Kabil said yesterday, Al Borsa reports. The government is now putting the “final touches” on the draft law and should be sending it to the House of Representatives for review by the end of November, House Industry Committee Chair Ahmed Samir tells the newspaper. The bill — which is expected to grant local assemblers incentives to move further up the value chain to manufacturing — has undergone several amendments to appease different industry players, particularly car importers, who had been particularly outspoken against the law, claiming it violates trade agreements with the European Union. The ministry had hired a German consulting firm to help with draft the legislation and incorporate feedback from different sources.

Under the amended bill, manufacturers would be eligible for incentives if they are able to meet a minimum local component requirement of 45%, which over the course of eight years would rise gradually to 60% for personal vehicles and smaller of group transport vehicles. Local content requirements for light trucks would peak at 70%. Manufacturers would also receive exemptions from development fees if they produce a certain number of vehicles on an annual basis, or if they export 25-40% of their total output a year.

Also from the land of cars this morning: Mansour Group-led consortium wins distribution rights for Peugeot cars: The Peugeot-Citroen arm of Groupe PSA has reportedly selected a consortium of Mansour Group and Dubai-based Scope Investment to be its licensed distributor of Peugeot vehicles in Egypt, Al Borsa reports. The decision follows reports that emerged last week that Peugeot-Citroen is ending its 41-year relationship with Cairo For Development and Cars Manufacturing (CDCM). The French automaker had called on companies in May to submit bids for the representation; CDCM was reportedly among the bidders, according to documents obtained by the newspaper. Groupe PSA is finalizing the partnership agreement with the consortium, with Mansour Group reportedly looking to spin up commercial activities in early 2018. Arabia Investments, Development and Financial Investment Holding Company had said last week that it would take “legal action to preserve its rights and protect the interests of shareholders.”

The number of tourists visiting Egypt grew 55% y-o-y in 3Q 2017 to 2.3 mn visitors, up from 1.5 mn for the same period last year,according to CAPMAS numbers picked up by Al Mal. July, August and September saw 781k, 819k and 732k visitors respectively, with Germany, Saudi Arabia and the Czech Republic topping the list of nationalities visiting. Third quarter numbers demonstrates the continued upswing in tourism this year, after first half of the year saw the number of tourists from 52.4% y-o-y.

New cigarette prices signed into law: President Abdel Fattah El Sisi officially signed into law on Thursday the latest tax increase on cigarettes, Al Borsa reports. Fixed tax rates for cigarettes sold for less than EGP 18 now stand at EGP 3.50, while cigarettes costing between EGP 18 and 30 will be taxed EGP 5.50 and those sold at more than EGP 30 will be taxed EGP 6.50. The old fixed tax rates were EGP 2.75, EGP 4.25, and EGP 5.25, respectively.

Eastern Company and Philip Morris each released a list of their new cigarette prices following the implementation of the tax increases. A pack of Merit will now retail for EGP 35, while Marlboro and L&M cigarettes now cost EGP 34 and EGP 27 per pack, respectively, Philip Morris announced, Al Mal reports. The new prices came into effect on Friday. Eastern Company’s cheapest offering now sells for EGP 14 a pack, up from EGP 11.50 before the implementation of the tax increase, the company announced in a new price list issued to the EGX. Arqaam Capital economist Reham El Desoki says the cigarette price increases will not have a significant impact on inflation rates as tobacco only has a 2% weighting in the consumer price index, according to Reuters. The newswire notes that Eastern Company has a 70% market share domestically.

National Bank of Greece to exit Egypt? The National Bank of Greece is reportedly looking for advisors on the potential sale of its 17 branches in Egypt, Al Borsa reports. The move is part of the bank’s restructuring plan mandated by the European Commission after Greece’s government debt crisis. The plan entails scaling back the bank’s presence overseas, according to the newspaper. A public relations officer at the bank declined to comment on the news, telling Al Borsa that any significant change in the bank’s plans would be announced officially.

MOVES- Mahmoud Montasser was tapped as the new deputy chairman and managing director of the National Investment Bank (NIB), succeeding Ahmed El Sayyad, Planning Minister Hala El Said, who is Chairman of NIB tells Al Mal. Montasser, who was previously the deputy chairperson at the National Bank of Egypt, assumes his new position today.

MOVES- Agriculture Minister Abdel Moneim El Banna appointed Ahmed Al Attar as acting head of the ministry’s Agricultural Quarantine Authority, Al Mal reports. The appointment of Al Attar, head researcher at the Plant Diseases Research Institute, comes amid a sweeping shakeup at the authority likely meant to curb alleged efforts by wheat inspectors to restore a zero-tolerance policy on ergot contamination of wheat. The shuffle comes after the Administrative Court issued a ruling which could potentially restore the zero-tolerance policy which has disturbed markets, and made wheat imports more expensive. The government has vowed to challenge the court’s ruling and maintain the global policy of permitting shipments of 0.05% ergot contamination.

MOVES- Apex International Energy appointed Robert Milius as its new chief financial officer. Milius was previously MENA Managing Director and Head of the Natural Resources Group at Barclays based in Dubai.

The Supreme Administrative Court allowed yesterday a lawsuit to go forward that challenges the constitutionality of the recently amended Judicial Authorities Act, which they claim gives the executive branch power over judicial appointments that blurs the separation of the executive and judicial arms of government. The suit was filed by lower court judges, Al Shorouk reports. The court’s decision is in line with a report from the State Commissioners Authority alleging that the act infringes on the constitutionally guaranteed independence of the judicial branch of government. Two judges with the Council of State (Maglis El Dawla) and State Lawsuits Authority, Yehia El Dakroury and Mohamed Mady, had filed formal appeals against presidential decrees that they claimed bypassed them as nominees to become the new heads of their respective judicial bodies. President Abdel Fattah El Sisi had appointed Hussein Abdo Hamza as Chairman of the State Lawsuits Authority and Ahmed Aboul Azm as head of the Council of State earlier this year. The Council of State had presented El Dakroury as its sole nominee for the post in protest of the Judicial Authorities Act, which requires the courts to submit three nominees for the president to consider.

Gas exporting countries called for a fair price for natural gas at a summit on Friday, according to the AFP. The Gas Exporting Countries Forum, at which Egypt is a participant, is angling to effectively decouple natural gas from oil prices, pointing to gas’ “environmental benefits and energy efficiency.”

Meanwhile, Russia and OPEC have roughed-out an agreement to extend output cuts until the end of next year, sources close to the negotiations told Bloomberg. Details are still being worked out ahead of a meeting in Vienna next week set to be attended by OPEC and non-member oil producers. Russia had been hesitant to furthering any agreements due to the current limits expiring in March and have asked that new terms on output cuts be contingent on the health of the oil market.