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Sunday, 4 Aug 2024

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Shaping the future of education in Egypt

Today at a glance

The Big Story Today

Energy investment plans are full steam ahead.

INSIDE INDUSTRY

Shipping containers, made in Egypt.

FOR YOUR COMMUTE

Stop mentioning AI in your marketing.

ON THE TUBE TONIGHT

Say bye, bye, bye to boy band glamor.

Sports

Day 9 of the Olympics.

OUT AND ABOUT

Sahel’s newest and coolest bazaar.

Ears to the Ground

We’re all worried about the same things.

WHAT WE’RE TRACKING TONIGHT

Another pipeline in the pipeline

Good afternoon, friends. Welcome to the beginning of the work week and day nine of the Paris Olympics. You will be glad to hear that on the investment and sports front, Egypt has been doing well.

THE BIG STORY TODAY

Energy investment news is once again leading the local news cycle, with news emerging that a consortium of state-owned companies plans to construct a USD 40 mn pipeline to transport imported ethane gas from Alexandria's Dekheila Port to facilities run by Sidi Kerir Petrochemicals (Sidpec) and the Egyptian Ethylene and Derivatives Company (Ethydco), Al Arabiya reports, citing an unnamed government official.

Sound familiar? The 40-km pipeline will be built by the Egyptian Natural Gas Company (Gasco) as part of the USD 660 mn project to import 1.1 mn tons of liquefied ethane annually through a newly launched joint venture announced on Thursday.

The why: The notoriously energy-intensive petrochemical, plastics, and fertilizer industries have been hit particularly hard over the last few months by the energy shortages facing the country. Companies in these industries, including Sidpec, were forced to temporarily shut down operations in June due to a “lack of feed gasses,” pushing many to look ways to secure gas supplies outside of the national gas network.

THE BIG STORY ABROAD

It’s another slow day for the global business press, with no single story dominating the news, but some are picking up on the fact that private capital groups are preparing for a flurry of transactions in the second half of the year amid widespread expectations of Fed rate cuts in September. Four of the US’s largest private capital firms — Ares, Apollo, Blackstone, and KKR — invested USD 160 bn in 2Q 2024 in anticipation of a coming increase in merger and buyout activity, the FT reports. Private equity firms are reportedly sitting on an additional USD 2 tn worth of committed capital that has not yet been deployed.

Private equity is back, baby: The uptick in mergers and buyouts comes after a year and a half of fairly tepid private equity activity that followed the boom years of 2021 and 2022. While we’re not back up to those levels, it’s clear that “The … market is back,” Scott Nuttall, co-head of KKR, tells the FT. “This year, we not only have an open market, we have pent-up supply … coming to markets. So we are optimistic.”

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

Saudi Arabia eyes turning CBE deposits into Egypt investments as the kingdom looks to boost its investments in the country through its Public Investment Fund.
Auto sales jump 27.6% from May to June, marking the third consecutive month of sales rises.
The country’s net foreign asset position remained in the green, despite the surplus shrinking 10% to USD 12.9 bn in June on the back of 41% reduction of the net foreign asset surplus held by commercial banks.

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

☀️ TOMORROW’S WEATHER- Mercury is peaking at a high 37°C before simmering to a moderate low of 27°C by night, according to our favorite app. Sahel and Alexandria are seeing cooler weather, with a high of 33°C and a low of 28°C.

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energy WHAT WE’RE TRACKING TONIGHT

FOR YOUR COMMUTE

AI marketing is hurting your sales

Despite the growing presence of AI in consumer goods, customer sentiment seems to be getting more and more hostile. A study conducted by Washington State University that tested consumer reactions to different marketing copy and included products like high-end electronics, medical devices, and fintech found that material that included AI messaging tested more negatively across the board due to lower emotional trust.

Are companies just missing the mark? Lead author of the study Mesut Çiçek believes that buzzwords may be to blame. “Marketers should carefully consider how they present AI in their product descriptions,” he advised, emphasizing that they should “focus on describing the features or benefits” instead of highlighting the tech takeover.

Apple and Google have already seen the effects of failing to read the room, after the two tech giants were forced to pull high-profile ads after backlash from audiences. Over the weekend, Google released and quickly pulled an Olympics ad (watch, runtime: 1:00) for their AI offering Gemini that showed a father using the chatbot to generate a fan letter from his daughter to US runner Sydney McLaughlin-Levrone that for many seemed to take away any meaning. While back in May, Apple released their commercial for the iPad Pro (watch, runtime: 1:08), showing a large hydraulic press crushing instruments, art, arcade games, and books to reveal their new ultrathin piece of hardware powered by Apple Intelligence, causing many to object to this perceived celebration of the crushing of human creativity that AI presents.

Whatever they hoped the message would be instead exacerbated consumer fear of generative technology, which seemed to viewers to “kind of [be] destroying humanity.” It’s not about AI stealing jobs anymore, says The Verge, it’s about promoting the use of AI as a replacement for authentic connection and creation. Alexandra Petri of The Washington Post wrote that those excited by the prospect of AI taking over all our tasks, including writing report summaries, data surveys, and no doubt including creating art and music, are not just “missing the point in a spectacular manner,” but missing out on life, even the tedious bits. “This is the ride, and you’re missing it.”

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AI FOR YOUR COMMUTE

ENTERPRISE RECOMMENDS

The darkside of the boy band scheme

? ON THE TUBE TONIGHT-
(all times CLT)

Beneath the glittering surface of famous boy bands’ meteoric rise to fame, Dirty Pop: The Boy Band Scam offers you front row seats to the ugly truth behind groups like Backstreet Boys and NSYNC. Netflix’s three-part docuseries delivers a blend of nostalgic VHS footage and candid new interviews, revealing the dark side of their success.

Lou Pearlman, an industry magnate turned music mogul, saw an opportunity in the lucrative world of boy bands. He created a rigorous and grueling regimen for his young protégés, who practiced incessantly on a makeshift stage in his hangar, dreaming of stardom while barely scraping by. Pearlman’s charisma and financial prowess masked a sinister agenda, as he manipulated these naive young talents and their families, siphoning millions while they remained in the dark.

The series also delves into the dissolution of Pearlman’s Ponzi scheme, highlighting the need for vigilance and good legal advice in the entertainment industry. The series balances nostalgia with the harsh realities of exploitation, making it both touching and informative. With old footage, revealing interviews, and the eerie presence of an AI version of Pearlman, it’s a captivating exploration of how ambition and trust can be manipulated, and a strong reminder to always read the fine print.

WHERE TO WATCH- You can watch the docuseries here, or watch the trailer (runtime: 0:56)

?Welcome to Day 9 of the 2024 Paris Olympics.

The Egyptian handball team has advanced to the next round after securing a victory over Argentina with a score of 34-27 in the fifth and final round of the group stage with a total of seven points. The outcome of Norway and Denmark’s match later today at 8:00pm will determine our team’s final standing and whether we will be facing the second- or third-place holder from group one.

Twelfth time’s the charm for the Pharaohs: Our homegrown men’s football team has advanced to the semifinals of the men’s soccer tournament after a thrilling 5-4 penalty shootout win against Paraguay on Friday night. Egypt will face host France’s national team in Lyon tomorrow at 10:00pm. After having reached the Men’s Soccer Quarterfinals a total of 11 times, this is the first time the Pharaohs have made it to the semis.

The medal table at the Paris Olympics at time of publication:

China (16 gold, 12 silver, 9 bronze — 37 total)
USA (14 gold, 24 silver, 23 bronze — 61 total)
France (12 gold, 14 silver, 16 bronze — 42 total)

TODAY

DON’T MISS-

Artistic Gymnastics: Men’s rings final (4:00pm), women’s uneven bars final (4:40pm), men’s vault final (5:24pm).
Athletics: Women’s high jump final (8:55pm), men’s hammer throw (9:30pm), men’s 100m sprint final (10:50 pm).
Swimming: Women’s 50m freestyle final (7:30pm), men’s 1.5k m freestyle final (7:37pm), men’s 4x100m freestyle relay (8:10pm), women’s 4x100m freestyle relay (8:32pm).

TOMORROW

DON’T MISS-

Triathlon: Mixed relay final (9:00pm).
Artistic gymnastics: Men’s uneven bars final (12:45pm), women’s balance beam final (1:38 pm), men’s horizontal bar final (2:33pm).

TEAM EGYPT:

Diving: Malak Tawfik, women’s 10m fixed platform preliminary (11:00am).
Table tennis: Egypt vs. Taiwan (11:00am), Egypt vs. China (4:00pm).
Greco-Roman wrestling: Mohamed Abdellatif in the men’s 130kg 1/8 finals (4:00pm), and Moemen Rabiea in the men’s 60kg 1/8 finals (4:10pm).
Sailing: Kholoud Mansy in the women’s small dinghy race (1:15pm), Ali Badawi in the men’s small dinghy race (3:40pm).
Football: Egypt vs. France in the semifinals (10:00pm).

You can follow Team Egypt through this schedule or by heading over to our Paris 2024 Guide.

Highlights from yesterday: Algerian boxer Imane Khleif has advanced to the semifinals, securing a medal for her country. Khleif broke into tears after her victory, following an unwarranted international smear campaign that has been berated by the IOC. As for athletes across the pond, American swimmer Katie Ledecky — the most ever decorated US female athlete — made history by winning the women's 800m freestyle, securing her ninth Olympic Gold Medal, matching the record of Soviet gymnastics legend Larisa Latynina.

Want to see when your favorite sport is on? Check out the official schedule here.

⚽ In the Nile League:

Al Ahly vs. Al Moqawloon (9:00pm).
Pyramids vs. Zed (9:00pm).

? OUT AND ABOUT-
(all times CLT)

Shababco is going to the coast this summer for their first bazaar at D-bay on Friday, 9 August. This one-day event is dedicated to showcasing the creative and entrepreneurial spirit of young local brand owners. Enjoy live performances throughout the day from both well-known and up-and-coming local artists. Tickets are out now.

Start of your week with a laugh at Rawabet Art Spaces Comedy Night with Comedy Kiosk. The event will take place tonight at 8pm. Get your tickets here.

Ahmed Khairy is taking the stage at The Boom Room’s open mic night this Tuesday, 6 August. Get your tickets here.

Another tribute night from CJC is dedicated to The Beatles. Glass Onion and WSH will be making their debut at CJC performing their homage to the iconic British band on Thursday, 8 August at 10pm. Find the details here.

NEW ALAMEIN FESTIVAL-

Amr Diab will be taking the New Alamein Festival stage on Friday, 9 August at 10pm. Get your tickets here.

Wael Kfoury returns to Egypt with a concert at Porto Golf in the North Coast on Friday, August 9, at 11pm. Get your tickets here.

Karim Abdelaziz and Nelly Karim will be performing in the play El Sindbad at the New Alamein Festival from Thursday, 8 August till Saturday, 10 August. Get your tickets here.

TV host Sherif Madkour and Lebanese actress and singer Diana Haddad will be having a live broadcasting of the show “4 Sherif Street” at the New Alamein Festival on Saturday, 10 August. The show will start at 10pm, get your tickets here.

The iconic Cairokee will be performing at the festival on Friday, 23 August. Find your tickets to the band’s show here.

HAPPENING LATER-

Prepare for the sixth edition of The Marakez Pyramids Half Marathon. Pick your race of choice and start training, because the marathon will take place on Saturday, 14 December. Note: The price to register is going to keep increasing. So sign up now through this link for the lowest price guarantee.

? EARS TO THE GROUND-

Magical Overthinkers is your perfect companion for navigating modern anxieties. The bi-weekly podcast features host Amanda Montell engaging with expert guests on topics like celebrity obsession, astrology, and social media comparison for those feeling overwhelmed by life’s chaos in the Information Age.

There’s a blend of heartfelt stories and sharp insights that offers a soothing remedy for those trapped in thought spirals. With practical takeaways and thoughtful conversations, the podcast helps listeners make sense of the absurd and find calm amidst the noise.

Have you overthought narcissistic behavior? In the episode Overthinking About Narcissism, Montell tackles the pervasive issue with psychologist Dr. Ramani Durvasula, asking whether we are experiencing a "narcissism fever" — driven by the rise of therapy speak, TikTok mental health trends, and high-profile narcissistic figures. It also leaves you with a question: Could our fixation on other people’s narcissistic behaviors be a reflection of our own narcissistic tendencies?

If you’re seeking clarity in a world that often feels nonsensical, this podcast is a must-listen. Quiet the mental clamor and perhaps even discover a melody within the chaos.

WHERE TO LISTEN- You can listen to this podcast on Apple Podcasts and Spotify.

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GO WITH THE FLOW

What the markets are doing on 4 August 2024

The EGX30 fell 2.9% at today’s close on turnover of EGP 3.2 bn (13.9% below the 90-day average). Foreign investors were net buyers. The index is up 14.5% YTD.

In the green: Faisal Islamic Bank of Egypt -USD (+0.5%).

In the red: E-finance (-8.0%), Egypt Kuwait Holding -EGP (-6.8%), and Emaar Misr (-6.7%).

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EGX Go with the Flow

Our weekly look at the issues, trends, and policies that are shaping Egypt's manufacturing industries.

Published every Sunday in EnterprisePM.

Read Inside Industry

INSIDE INDUSTRY

Egypt looks to localize the shipping container manufacturing industry

Shipping containers, made in Egypt: The government is in the process of launching a project to build Egypt’s first factory to build shipping containers alongside a private sector firm, the Transport and Industry Ministry announced at the end of last month. The move comes as a means to serve the needs of local industry and to reduce FX outflows by cutting imports of containers.

The logistics sector and its need for containers are growing: Egypt’s logistics market is expected to reach around USD 14.6 bn this year, before growing by another USD 18 bn by 2029 — an annual growth rate of 4.3%, the secretary-general of the Federation of Egyptian Chamber of Commerce’s international transport and logistics division, Amr Al Samdouni, told Enterprise. A local industry would represent a “very positive” step forward, Al Samdouni said.

But how are Egyptian companies currently acquiring containers? Local companies are currently forced to rent or purchase the containers they need at USD rates that vary based on the size of the shipping container and the type of goods being transported. A local manufacturing industry would save Egypt a significant amount of FX by allowing payments to be made in EGP, Al Samdouni added.

Now is a better time than any as container prices have skyrocketed amid soaring demand: Since Houthi attacks on passing vessels in the Red Sea have disrupted the international shipping industry, prices of containers have gone up to an average of USD 7.5k per container — up from around USD 1.9k previously, as demand has outstripped supply, Al Samdouni said. Domestic shipping costs have also gone up by 25% and could go up to a further 10% on the back of the government’s recent decision to hike diesel prices.

There’s still a long way to go before we will start seeing locally made containers: The plan to manufacture containers locally — while representing a good first step to solving the problem — is still lacking the necessary studies and preparations to make it possible, a source from the Chambers of Commerce’s transport and logistics division told Enterprise.

Some of the problems to overcome are legislative: There are currently no Egyptian-owned cargo ships due to ownership laws for vessels and the flying of the Egyptian flag on privately owned ships, which has led the local commercial maritime fleet to decline in size over the years, the source added. This, coupled with the lack of raw materials provided and soaring input costs have made the market largely dominated by foreign companies, the source added. This was echoed by Ibrahim El Dessouky, head of the Federation of Egyptian Industries’ Maritime Transport division, who highlighted the need for amending laws related to maritime transport, especially with regards to the building of ships and their components, as well as removal of all obstacles to the entry of foreign and local operators.

A local accreditation body will help speed the process along: Container manufacturing currently requires a type of steel that is subject to approval from international bodies — a process which can take up to six months, El Dessouky tells us. Having a local accreditation body would make the local sector more competitive in terms of time and cost efficiency.

The success of the project should pave the way for a fully Egyptian shipping line: The government’s foray into the container manufacturing sector will eventually lead to the launch of a local shipping line that will ship to neighboring areas, including East Asia and Europe, a source in the maritime transport sector told Enterprise. This will help position Egypt as a logistics hub in the region, the source added.

The state has a few options for where to launch the proposed container manufacturing factory: The government could select the industrial area of Sixth of October city— which serves eight industrial and logistics areas and is linked to Alexandria Port — or the industrial zone in Tenth of Ramadan City, the source said.

The factory could be constructed alongside the Arab Organization for Industrialization — which, El Dessouky says, would enable the completion of a comprehensive system for logistics areas, corridors, and port development. El Dessouky also emphasized the need for prioritizing the Egyptian fleet for transporting goods as soon as the first Egyptian container is produced, as factories currently incur heavy fines due to the lack of containers for loading goods.

The industry needs land for building ships and their components, with the Federation of Egyptian Industries’ Maritime Transport division set to hold a meeting with Transport and Industry Minister Kamel El Wazir to provide industrial land for shipbuilding and its components. Despite the building of ships being a prominent activity in Rashid, Damietta, and Kafr El Sheikh, the land is still under the jurisdiction of the water, agriculture, and local development ministries, due to the manufacturing being done on the coast of the Nile. Having the lands under the jurisdiction of the Industrial Development Authority will lead to a boom in manufacturing operations for the sector, and will give manufacturers access to tax benefits and other incentives directed to the industrial sector, El Dessouky tells us.

Big investments are needed for the sector: The growth of the sector depends on whether or not it’s receiving the necessary funding, El Dessouky said, adding that it should be placed among the sectors that receive funding from banks with the necessary guarantees, as it requires sizable investments to function. The federation has reportedly received a number of enquiries concerning the lack of industrial land for maritime-focussed activities in the state's industrialization plan, despite there being six companies manufacturing ships for foreign clients and exporting them abroad.

Connecting ports with a transport and container network compatible with the infrastructure is another important step, El Dessouky told us. The infrastructure in Egypt’s ports is quite robust, and entering the container manufacturing field will turn Egypt into a logistical hub, but it’ll take time before it is able to compete with global shipping agents, El Desoukky added.

Your top industrial development stories for the week:

Efforts to localize the auto industry get a push: The government wants to set up three factories with investments of USD 1.4 bn to produce parts and materials to support the country’s efforts to localize the auto industry.
A new phosphate fertilizers plant is in the works: Singapore-based chemical company Indorama — in partnership with Phosphate Misr — is building a USD 400-500 mn phosphate fertilizers plant in Ain Sokhna. Preliminary work on the plant is expected to wrap up by year end, with actual implementation starting in 2025.
Another industrial zone in Alexandria: The government is planning to set up an industrial zone focused on chemical and plastic industries — as well as engineering industries complementary to the chemical sector — in Alexandria.

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INSIDE INDUSTRY logistics transport

THE ENTERPRISE ENTERTAINMENT CALENDAR

AUGUST

16 July-15 October (Tuesday-Tuesday): In the Company of Mahmoud Said exhibition at Aisha Fahmy Palace.

11 June-2 September (Tuesday-Monday): Afashat w Aflam exhibition at Bibliothek.

11 July-30 August (Thursday-Friday): New Alamein Festival at North Coast.

18 July-10 August (Thursday-Saturday): Summer Music Festival at the Cairo Opera House.

4-6 August (Sunday - Tuesday): Edugate 2024 at Royal Maxim Palace Kempinski.

4 August (Sunday): Comedy Kiosk at Rawabet Art Space.

6 August (Tuesday): Ahmed Khairy at The Boom Room.

6 August (Tuesday): Karaoke Night at CJC 610.

8 August (Thursday): The Beatles tribute night at CJC.

8-10 August (Thursday-Saturday): El Sindbad at the New Alamein Festival.

9 August (Friday): Shababco at D-Bay.

9 August (Friday): Amr Diab at New Alamein Festival.

9 August (Friday): Wael Kfoury concert at Porto Golf.

23 August (Friday): Cairokee at New Alamein Festival.

SEPTEMBER

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

OCTOBER

6 October (Sunday): Armed Forces Day.

29-30 October (Tuesday-Wednesday): Intelligent Cities Exhibition & Conference (ICEC) at Waldorf Astoria.

DECEMBER

14 December (Saturday): The Marakez Pyramids Half Marathon.

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