A new cabinet sworn in later today

Wednesday, 3 Jul 2024

A new cabinet sworn in later today

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Today at a glance

Cabinet watch

The rundown of Egypt’s new cabinet.

Real estate

TMG announces its first venture into Egypt’s North Coast with EGP 1 tn project.

Education

Al Ahly CIRA to set up four new international university models.

Investment Watch

Signify, Gila Electric plan to set up projects worth over USD 100 mn.

SMEs

New Visa report highlights crucial financial trends for Egypt’s SMEs.

Also on our Radar

Fertilizer companies restart operations as gas supplies return.

PLANET FINANCE

Nearly USD 9 bn worth of locked-up BTC is about to hit the market — what does it mean for prices?

HARDHAT

Egypt has big dry port plans — where do they currently stand?

What We're Tracking Today

FEDCOC calls for shops to open, close later under new opening hours

Good morning, friends. We will not only be welcoming a new fiscal year, but also a new government that is set to be sworn in later today. We’ve got a packed issue for you today with a rundown of the who’s in and who’s out of the new cabinet, a colossal EGP 1 tn real estate project by TMG on the North Coast, and so much more. You’ve got a lot of important news to get through this morning, so let’s jump right in.

WATCH THIS SPACE-

#1- FEDCOC proposes revising shop opening hours: The Federation of Egyptian Chambers of Commerce (FEDCOC) will submit a proposal to the Local Development Ministry recommending changes to the current opening and closing times for retail shops, which currently close at 10pm under a new initiative to end blackouts this summer, FEDCOC board member Osama Al Shahid told Al Borsa.

Adjusting hours to suit regional consumer habits: The proposed changes suggest that retail outlets in Upper Egypt should open from 3pm to 1pm, aligning with consumer habits in these hotter regions, where shopping typically begins at sunset when temperatures drop. For Greater Cairo and the Delta, the proposal recommends shop open from 12pm to midnight or 1am.

#2- El Attal to make its debut on the bourse next year: Real estate player El Attal Holding is planning to list 30-35% of its shares on the EGX in 2025, CEO Ahmed Al Attal told Asharq Business (watch, runtime: 3:02). The property developer is working with advisors from the UK and Greece to set up the offering, Attal said, adding that the company’s fair value will be out before the end of 2024.

Also, the developer will build a residential project in KSA: Attal revealed that his company will ink an agreement with the Saudi Housing Ministry to set up a 1.5k unit residential project in the kingdom.

#3- Real Estate Development Chamber wants to work with gov’t on affordable housing: The Federation of Egyptian Industries’ Real Estate Development Chamber is planning to propose an integrated affordable housing initiative that would see the government facilitate private sector development of affordable housing project by offering land at a reduced cost, chamber head Tarek Shoukry told Asharq Business.

Remember: Throughout President Abdel Fattah El Sisi’s third term that ends in 2030, the government is planning to build 672k housing units — including affordable housing — a year in a EGP 318 bn strategy to double the country’s inhabited areas to 14%. The plan is to establish 30 new cities to house 15-20 mn people.

PSA-

WEATHER- It’s another hot and sunny day in Cairo today, with a high of 39°C and a low of 26°C, according to our favorite weather app.

It’s warming up a little in Alexandria and along the North Coast, with a high of 36°C and a low of 22°C.

** DID YOU KNOW that we now cover Saudi Arabia and the UAE?

** Want to subscribe? Tap or click here to get your own copy delivered every weekday before 7am Cairo time — without charge.

HAPPENING TOMORROW-

Checking in on the non-oil private sector: S&P Global will publish Egypt’s PMI figures for June tomorrow, measuring the country’s non-oil private sector activity. Last month saw business activity in Egypt inch closer to growth after 42 straight months of contraction.

DEBT WATCH-

CBE soaks up more excess liquidity from the market: The Central Bank of Egypt yesterday accepted bids from 31 banks for EGP 1.1 tn in fixed-rate deposits at a rate of 27.75% during its weekly fixed-rate auction, according to data on its website.

THE BIG STORY ABROAD-

Picking up exactly where we left off yesterday, the global business press remains squarely focused on fallout from the US presidential debate and a court ruling on Trump’s presidential immunity.

Donald Trump’s sentencing in his hushmoney trial was delayed to 18 September, only weeks before US voters go to the poll, Reuters reports. The delay comes after the controversial Supreme Court ruling on his immunity from prosecution for “official acts” while in office. At question is whether the judge will now have to throw out evidence that bolstered prosecutors’ case.

Meanwhile, Biden is still blaming his debate performancejet lag as more Democrats raise concerns around his health and ability to serve a second term. See:

Biden’s lapses are said to be increasingly common and worrisome (NY Times)
Biden faces doubts from Democrats about his 2024 re-election (Reuters)
Scoop: Inside House Democrats' anti-Biden vent session (Axios)
Biden’s damage control is faltering (Semafor)

The bottom line: As Biden digs in, some top Democrats want him out of the race this week, writes CNN.

*** 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: We take a look at efforts to set up more dry ports and logistic zones across the country in line with the plan to make Egypt a global trade and logistics hub.

Tags:

retail What We're Tracking Today

Somabay in the Red Sea is thrilled to host the incredible tennis player Mayar Sherif, who is ranked 31st globally, to train on our grass tennis courts in Soma Sports Arena as she gears up for Wimbledon. Best of luck, Mayar.

Cabinet watch

The rundown of Egypt’s new cabinet

Introducing your new government: Last night, the air was abuzz with leaks of who Prime Minister Moustafa Madbouly picked to sit at his new government, with close to 20 new faces set to take over ministries.

It’s about time: We’ve been waiting for the announcement of a new cabinet for months now, after President Abdel Fattah El Sisi kicked off his third term back in April as a new cabinet is usually sworn in with every new presidential term.

Some big names are keeping their positions: Among those that retained their ministries is Rania Al Mashat (LinkedIn), who will be back with a larger remit and hold the portfolios of the Planning and Economic Development Ministry along with the International Cooperation Ministry. The move will mean that we will say farewell to Planning and Economic Development Minister Hala El Said.

There’s more: Another high-level minister, Kamel El Wazir (bio), is also back and will be likewise taking over the some of the responsibilities of the Industry Ministry in addition to the Transport Ministry. The move will see Ahmed Samir leave his position as the Trade and Industry Minister.

And of course, Madbouly is still at the helm. Prime Minister Moustafa Madbouly submitted his soon-to-be former government’s resignation in early June and agreed with President Abdel Fattah El Sisi to choose and “form a new government that includes the necessary expertise and competencies to manage the next phase.”

We will also be saying goodbye to some high-level ministers and welcoming some new faces: Ahmed Kouchouk (LinkedIn) is going to head the Finance Ministry, replacing Mohamed Maait, who had the ministry since 2018. Kouchouk served as the vice minister of finance for fiscal policies and institutional reforms for over eight years, during which he played an important role in the IMF negotiations.

Analysts think Kouchouk is a good choice: “It’s a good news appointment — well known and liked by the markets,” Bloomberg reported FIM Partners’ Charlie Robertson as saying. Robertson added that Kouchouk is seen as a continuity candidate, which is important “when a primary goal is to get interest rates down.”

The Investment Ministry is back: The new cabinet will include the long-shelved Investment and Foreign Trade Ministry — a move that aligns with state efforts to boost FDI and FX inflows. The newly revived ministry will be headed by Hassan El Khatib (bio), who has had a 35-year career that saw him work in a number of investment banks.

The Supply and Internal Trade Ministry will be headed by Sherif Farouk (LinkedIn), replacing Aly El Moselhy, who has come under increasing pressure amid commodity shortages and spiraling inflation in recent years. Farouk is the chairperson of Egypt Post and former CEO of Nasser Social Bank.

A new face from the private sector at the Oil Ministry: With the government’s energy policy and energy investments being a hot topic of conversation on the airwaves, in the local business press, and on the street corner, the Oil and Energy Resources Ministry will also welcome a new face to head the ministry, with Karim Badawi (LinkedIn) set to replace Tarek El Molla. Badawi is the current MENA director of US-based oil player SLB.

The Electricity Ministry will also see Mohamed Shaker leaving and come under new management with Mahmoud Esmat (bio) who is set to leave his current position as the Public Enterprises minister.

Foreign affairs veteran Sameh Shoukry is also out: The new government will see Badr Abdelatty (bio) replace outgoing Foreign Minister Sameh Shoukry and outgoing Immigration Minister Soha Gendi as Abdelatty takes over the responsibilities of the Foreign Affairs Ministry and Immigration Ministry. Abdelatty is no stranger to diplomacy, having held a number of diplomatic roles that included serving as Egypt’s ambassador to Germany and Egypt’s ambassador to the EU.

WHO ELSE IS IN THE NEW CABINET?-

DEFENSE- General Abdel Maguid Sakr (bio) replaces General Mohamed Zaki. Sakr was previously the governor of Suez.
INTERIOR- Mahmoud Tawfik (bio) keeps his position, which he has held since 2018.
JUSTICE - Adnan El Fangary (bio) replaces Omar Marwan. Fangary previously held a number of positions within Egypt’s courts.
EDUCATION- Mohamed Abdellatif (bio) replaces Reda Hegazy. Abdellatif is the current CEO of Nermein Ismail schools.
HIGHER EDUCATION AND SCIENTIFIC RESEARCH- Ayman Ashour (LinkedIn) has kept his position. He has been in his post since 2022 after taking over from Abdel Ghaffar who left his post to become the Health minister.
HEALTH AND POPULATION- Khaled Abdel Ghaffar (bio) has kept his position. He assumed his role in 2021 after taking over from former Health Minister Hala Zayed.
TOURISM AND ANTIQUITIES- Sherif Fathy (Wikipedia) replaces Ahmed Eissa. Fathy was the country’s civil aviation minister between 2016 and 2018.
HOUSING- Sherif El Sherbini (bio) replaces Assem El Gazzar. El Sherbini was the head of the 6th of October City Development Authority.
AGRICULTURE- Alaa Farouk (LinkedIn) replaces El Sayed El Quseir. Farouk is the current chairman of the Agricultural Bank of Egypt and has held several positions at the National Bank of Egypt.
IRRIGATION AND WATER RESOURCES- Hani Sewilam (bio) has kept his position — he was appointed in 2022.
COMMUNICATION AND INFORMATION TECHNOLOGY- Amr Talaat (bio) has kept his position, which he has held since 2018.
ENVIRONMENT- Yasmine Fouad (bio) keeps her post in the Environment Ministry, which she has held since 2018.
ENDOWMENTS- Usama Al Azhari (bio) replaces Mohamed Mokhtar Gomaa. Al Azhari is a renowned scholar, preacher, and academic who taught at Al Azhar University.
CULTURE- Ahmed Hanno (bio) replaces Nevine El Kilany. Hanno was the Dean of the Faculty of Fine Arts at the Helwan University, before heading the Art and Design Faculty in Galala University in 2020.
LABOUR- Mohamed Gobran (bio) replaces Hassan Shehata. Gobran holds a BA in Commerce and is a veteran trade unionist. He was elected head of the General Oil Syndicate in 2018, President of the Egyptian Trade Union Federation in 2022, and President of the Central Council of the International Confederation of Arab Trade Unions in April 2024.
CIVIL AVIATION- Sameh Elhefny (LinkedIn) replaces Mohamed Abbas Helmy. Elhefny was the chairman and CEO of EgyptAir between 2014 and 2015 and is currently a representative of Egypt in the International Civil Aviation Organization’s council.
LOCAL DEVELOPMENT- Manal Awad (bio) replaces Hisham Amna. Awad was previously the governor of Damietta.
PARLIAMENTARY AFFAIRS- Mahmoud Fawzy (bio) replaces Alaa Fouad. Fawzy was the legal advisor to the House speaker between 2016 and 2020, and the head of President Abdel Fattah El Sisi's re-election campaign last year.
PUBLIC ENTERPRISES- Petroject’s former CEO, Mohamed El Shimi is a potential candidate to take over the Public Enterprises Ministry off Mahmoud Esmat’s hands, after he replaces Mohamed Shaker at the Electricity Ministry, according to Mostafa Bakry.
SOCIAL SOLIDARITY- Maya Morsy (LinkedIn) replaces Nevine El Kabbaj. Morsy is president of the National Council for Women and a regional advisor to the UNDP on gender policies.
SPORTS AND YOUTH- Ashraf Sobhy (bio) has kept his position, which has held onto since 2018.
STATE MINISTRY FOR MILITARY PRODUCTION- Mohamed Salah Eldin Moustafa (bio) kept his position, which he has held onto since 2022.

ALSO- Madbouly’s new cabinet also comes bearing a governors’ shuffle, with 21 of Egypt’s governorates expected to welcome new governors and the remaining six governorates to retain the same governor. Among the governorates set to get new governors in charge are Cairo, Alexandria, and Suez.

AND- Media councils and bodies are set for a shake-up in the coming days, a senior government official told Extra News The official added that new appointments will be issued after receiving nominations from professional syndicates, the House, and the Supreme Council of Universities.

Making it official: The new cabinet will be sworn in by President El Sisi later today at the Ittihadiya Palace, an unnamed government official told Extra News (watch, runtime: 00:51).

The international press also picked up the story: Reuters | Bloomberg.

Editors note: This story was updated to show that General Mohamed Zaki was replaced by General Abdel Maguid Sakr at the Defense Ministry in the final cabinet line up. The story was also updated show that the Local Development Ministry is now headed by Manal Awad and not Abdel Maguid Sakr.

Tags:

Real estate

TMG announces its first venture into Egypt’s North Coast with EGP 1 tn project

TMG unveils its first North Coast project: Talaat Moustafa Group (TMG) announced its first project in Egypt’s North Coast, a 23-mn square meter project with investments of around EGP 1 tn (c. USD 21 bn), the company said in an EGX disclosure (pdf).

People are already lining up for a piece of the new development: The project, dubbed SouthMed, garnered a record EGP 60 bn (c. USD 1.3 bn) worth of reservations in the first 12 hours of booking prior to the project’s official sales launch, CEO Hisham Talaat Moustafa said at a press conference accompanied by Prime Minister Moustafa Madbouly. The company sees the development generating sales surpassing EGP 1.6 tn, ultimately contributing EGP 2.4 tn to the Egyptian economy and helping create 1.6 mn new jobs.

What they said: “The project is in line with the country’s strategic vision to leverage the geographical and natural wealth of the North Coast and its buoyant market, drawing in both international and local demand in residential and tourist sectors,” the disclosure read. “This development strives to enrich and broaden the country’s upscale leisure tourism and second-home offerings by tapping into new international and local market opportunities and promoting economic expansion and diversification.”

A way to bring in more FX: The project comes in line with the company’s strategic emphasis on strengthening FX-denominated real estate and tourism exports, the release said. Talaat Moustafa anticipates that the project will draw affluent tourists from European countries, the UK, and Arab nations. He attributed this to the prime location, highlighting that flights from Europe to Alamein International Airport, which is just 15 minutes away from the project, take about three hours, Talaat Moustafa explained.

There’s a lot of interest in the country’s North Coast from the country’s real estate sector: ADQ acquiring the development rights to the North Coast’s Ras El Hekma for USD 35 bn in February was followed by a flurry of announcements from real estate developers setting up North Coast projects.

A year of firsts for TMG: The group recently made its Saudi debut with the launch of its mixed-use Benan City project in May.

Reuters also had the story.

Tags:

real estate Talaat Moustafa Group

Education

Al Ahly CIRA to develop four new international university models in Egypt under agreement with the Sovereign Fund of Egypt

Al Ahly CIRA to set up four new international university models in Egypt: Al Ahly CIRA — an education investment company set up by CIRA Education and the National Bank of Egypt’s Al Ahly Capital Holding in 2021 — will develop four new international university models in Egypt under a newly-signed agreement with the Sovereign Fund of Egypt (SFE), according to a statement from the cabinet and a joint statement (pdf) from the participating parties.

International expertise: The universities will be established in collaboration with global educational institutions from Canada, Switzerland, Germany, and the US, with the specific partners set to be announced once cooperation agreements are finalized, the statement read. This collaboration will help create institutions that meet the highest global standards and address the diverse needs of Egyptian students, CIRA Education Chairman Hassan El Kalla said.

The comeback of the PPP education program? The new universities will be set up under a public-private partnership, potentially reviving the long-stalled PPP education program. It was also announced this week that the state is expected to offer 26 schools to private sector players in the next two months.

Vouching for PPPs: “This collaboration underscores the immense potential of public-private partnerships in driving sustainable development and societal progress,” El Kalla added.

Part of a wider plan: The project comes as part of the government’s economic and social development plan for the upcoming fiscal year, which aims to increase “the competitiveness of higher education through a set of incentivizing investment packages for the private sector,” as well as elevating the quality and international competitiveness of Egyptian public universities, increasing the number of tech-focused universities in partnership with the private sector, and increasing the number of international students enrolled in Egypt’s educational institutions, Planning Minister and fund chair Hala El Said said.

What they said: “This partnership exemplifies our dedication to creating impactful public-private collaborations that enrich the educational journey of Egyptians,” SFE CEO Ayman Soliman added. “By partnering with Al Ahly CIRA, we are bringing world-class education to our national campuses, ensuring accessibility and affordability,” he added.

Advisors: Al Ahly CIRA has tapped Al Tamimi & Company to represent the investment company in its partnership with the SFE, the law firm said in a statement seen by Enterprise.

Tags:

CIRA Education Education public-private partnership Sovereign Fund of Egypt

Finance

Visa unveils key financial trends for SMEs in Egypt

The financing gap for SMEs in Egypt is estimated at around USD 46 bn, but these businesses contribute more than 43% of the country’s GDP, according to the latest report from global payments giant Visa on key financial trends for SMEs.

A massive market: The more than 12mn SMEs make up 98% of all businesses operating in Egypt by number and employ over 47 mn citizens, marking them an important avenue for banks, non-banking financial institutions, and fintech companies, Visa Egypt's Vice President and General Manager Malak El Baba, said at a press conference to release the report.

One key trend is a move towards seeking formal financial services: SMEs in Egypt — 33% of which are financially constrained — are still “largely underserved and underbanked,” according to the report. Although 85% of SMEs don’t have access to banking services on the back of very few banking products catering to SMEs and other costs and complications, SMEs are increasingly looking towards formal financial services because they are seen as reliable and secure.

SMEs are also looking towards BNPL and POS financing as a way to boost sales: Visa notes that 49% of SMEs want to increase revenue by letting customers have a buy now, pay later (BNPL) payment option, with some c. 180k merchants already accepting the payment method. BNPL along with point-of-sale (POS) financing options are “gaining traction as a merchant tool to incentivize consumer conversion and increased spend,” according to the report.

Social media is increasingly becoming a key driver of sales: Of the over 51 mn social media users in the country, many are increasingly using social media platforms to find and even buy products from local SMEs. Customers that SMEs acquire online now make up 30% of their customer base.

E-wallets are becoming increasingly popular: With USD 30 bn changing hands via e-wallets in 2023, Visa sees demand increasing for their online and offline acceptance. Visa notes that the rising acceptance and use of e-wallets has changed the way many SMEs run, enabling them to take their operations online.

SMEs are eager to build a bigger and better online presence: Visa found that 32% of SMEs are looking to develop a presence online to find news customers from the 41 mn Egyptians that shop online.

B2B marketplaces are more and more attracting SMEs: Business-to-business (B2B) marketplaces are now used by more than 350k local SMEs because they are “increasingly recognizing [their] cost-effectiveness, efficiency, and accessibility.”

Digital business tools are on the up: “SMEs have ambitions to continue growing and improving their businesses through digital tools and are optimistic about digitization,” the report notes. While 42% of SMEs in the country use at least one digital tool, 88% of them are interested in a digital inventory solution, and a further 91% say they feel comfortable using digital tools in their businesses.

Addressing financial challenges: While 33% of SMEs face financial challenges, only about 15% have access to banking services, with the current loan portfolio for this segment estimated at around USD 11 bn in Egypt, according to the report. Visa has managed to increase its customers’ access to finance in Egypt tenfold over the past four years, while the number of point-of-sale terminals has expanded 7-8 times during the same period, said Karim Sayegh, Visa's head of corporate services for North Africa, the Levant, and Pakistan, during the presser.

What do these businesses need to grow in Egypt? Simply put, they need easily accessible financial products, continued business growth, and the ability to expand by managing spending on digital advertising and consumer outreach, while accepting multiple payment methods, the report stated. Additionally, leveraging digital channels to increase sales through e-commerce, bulk buying, supply chain management, and effective cash flow management will enhance their efficiency.

AND- Visa is working with the Central Bank of Egypt on operational trials for payment card tokenization on mobile applications, allowing contactless payments via these apps, with plans to officially launch the service through one of the largest state-owned banks soon, El Baba revealed.

ALSO- Visa is also collaborating with the CBE to draft new regulations to develop digital payments in foreign trade transactions, which could be announced by the Central Bank of Egypt soon, El Baba disclosed.

Tags:

banking Central Bank of Egypt Finance financial inclusion Financial Markets Fintech SMEs Visa

Investment Watch

Signify, Gila Electric plan to set up projects worth over USD 100 mn in Egypt

Over USD 100 mn worth of projects around the corner: Dutch lighting manufacturer Signify — formerly known as Philips Lighting — and local electrical solutions manufacturer Gila Electric are in talks with the government to launch four projects worth a combined USD 106 mn, according to a cabinet statement. These include a joint venture for the manufacture of lighting products, a factory for electrical panels, a solar power plant, and a green hydrogen project. Here’s the breakdown:

#1- A USD 50 mn lighting production facility: The two companies plan to set up a JV — dubbed Signify Gila for Lighting Technology — to build a USD 50 mn factory that manufactures state-of-the-art LED lighting solutions. The factory, which is expected to come online in early 2025, aims to export 60% of its production to Europe, Africa, and the Middle East. The project will employ over 1k Egyptians.

#2- USD 20 mn electrical panels factory: Gila Electric plans to establish a c. USD 20 mn factory in Tenth of Ramadan City to expand its production and assembly of low- and medium-voltage electrical panels.

#3- A 40 MW solar power plant: Gila Electric wants to invest around USD 20 mn to ramp up the capacity of its 5 MW solar power plant to 40 MW and connect the facility to the national grid. The project file has been submitted to the Electricity Ministry.

#4- A USD 16 mn green hydrogen project: The fourth project involves the production of green hydrogen with an estimated cost of USD 16 mn.

Where do the projects stand? Representatives from Signify and Gila Electric met with government officials, including Prime Minister Moustafa Madbouly, yesterday to go over the proposed projects and discuss the steps needed for implementation. The relevant ministries are set to study the projects and follow up on their implementation.

More to come? The meeting also saw the government requesting Signify to help localize the medical device industry, with the company’s officials saying they would relay the request to their management.

Tags:

investment watch Manufacturing

LAST NIGHT’S TALK SHOWS

The new cabinet lineup dominated the airwaves last night

The new ministerial lineup was front and center on last night’s talk shows, following media reports about the new government lineup unveiled yesterday. The nation’s talking hosts covered the new government extensively throughout the night, highlighting potential additions and departures, including Kelma Akhira (watch, runtime: 29:05), Ala Masouleety (watch, runtime: 19:27), Al Hayah Al Youm (watch, runtime: 6:34), Masa DMC (watch, runtime: 48:38), and Yahduth Fi Masr (watch, runtime: 9:05).

Women’s ministerial roles shrink in the new cabinet lineup: "The number of ministerial portfolios held by women has decreased from 13 in the previous government to about three or four portfolios so far," said the Lamis El Hadidi (watch, runtime: 0:37). "We hope to see a female Prime Minister for Egypt one day,” El Hadidi went on to say.

“What’s more important than changing names is changing policies," El Hadidi said, adding that “we expect the new government to present a clear action plan with specific assignments for each minister as we face a critical phase and significant challenges ahead," (watch, runtime: 29:05). She also commented that “We are witnessing the largest merger of ministries in the Egyptian government, posing administrative challenges for ministers handling two ministerial portfolios.”

Tags:

LAST NIGHT’S TALK SHOWS politics

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Also on our Radar

Fertilizer companies restart operations as gas supplies return. PLUS: Futek, Wellpal, Azimut, EdVentures, Orascom Development Egypt

ENERGY-

Fertilizer companies restart operations following shutdowns: Abu Qir Fertilizers and Mopco restarted operations at their factories yesterday following the resumption of natural gas supplies, the companies said in EGX disclosures (here, pdf, and here, pdf). The move follows the resumption of production at Sidpec’s factory last week.

Remember: The nation’s power crisis and shortage of gas supplies has forced major companies from the famously energy-intensive fertilizer industry to halt operations completely, the latest being Egypt Kuwait Holding’s AlexFert, which suspended production on Monday. Sidpec, Abu Qir Fertilizers, Mopco, and Kima have cited the lack of feed gasses as a reason to power down their factories. The government secured 20 LNG shipments last week as it works to ensure it has sufficient supplies for households and factories during the current period of increased demand expected to last till September.

EXPANSION TO THE GCC-

#1- Futek eyes JV with the Saudi government: Lighting products manufacturer Futek Lightings is in talks with the Saudi government to set up an industrial complex for the manufacture of energy-saving lighting fixtures in the kingdom, CEO Mohamed Helal told Al Borsa. The project is expected to see an initial investment of USD 25 mn that will be entirely funded by the Saudi side, with Futek providing its expertise in the field.

#2- Wellpal sets up shop in KSA: Health-focused e-commerce platform Wellpal has launched in Riyadh, according to a company statement. The company has also relocated its headquarters to Saudi Arabia and will soon announce a new investment, Follow ICT quotes CEO Mohamed Ali as saying.

Wellpal? Founded in 2020, the company offers a range of natural and organic lifestyle products, such as herbs, oils, hair and skincare products, and foods. It connects merchants, suppliers, and end users through its app on the App Store and Google Play.

#3- Azimut goes to Saudi next year: Asset manager Azimut expects to make its KSA debut by early 2025, once it secures approval from the Saudi Capital Market Authority, CEO Ahmed Abo El Saad told Asharq Business. The asset manager intends to focus on “asset management, whether in equities or fixed-income instruments,” according to Abo El Saad.

BANKING-

CBE to restructure bank boards for enhanced governance: The Central Bank of Egypt has issued new guidelines aimed at improving the composition and governance of bank boards, aiming to bolster decision-making and operational efficiency within banks, according to a CBE circular (pdf).

New rules enforce executive-non-executive balance and limit tenure: According to a recent amendment, boards must now include a balanced mix of executives and non-executives, with a cap of three executives. At least two independent non-executive members are required, who will play a key role in supervising senior management. Non-executive members can serve a maximum of two terms, totaling six years, with a potential three-year extension subject to strong justifications and CBE approval.

STARTUPS-

EdVentures invests in Edtech startup El Kheta: Nahdet Misr’s VC arm EdVentures invested USD 400k in online education platform El Kheta, as part of the company’s vision to support educational tech entrepreneurs and startups, writes Al Mal.

HOSPITALITY-

Hilton’s DoubleTree is heading to New Cairo: Global hospitality brand Hilton will set up a branch of its 3.5 star DoubleTree hotel chain in New Cairo’s @40 commercial complex under a partnership with Misr Company for Investment and Development, according to a press release (pdf) from Hilton. Expected to open in 2027, the hotel will house 70 apartments, a fitness center, cafe, restaurant, two bars, and three meeting rooms. The development is the latest in Hilton’s plans to double its portfolio of properties in Egypt by 2028.

REAL ESTATE-

Orascom Development Egypt wraps EGP 1.5 bn land sale in El Gouna: Orascom Development Egypt (ODE) has sold a 145.3 sqm plot of land in El Gouna for EGP 1.5 bn — 15 times the land’s book value of EGP 101 mn — the company said in a statement (pdf) without naming the buyer. The sale is part of the company’s “strategic initiative to enhance value creation through selective land sales and land development aimed at accelerating the monetization of its land bank.”

Tags:

Abu Qir Fertilizers ALSO ON OUR RADAR banking Central Bank of Egypt EdVentures El Gouna energy fertilizers Hilton hospitality Manufacturing Mopco oil and gas Orascom Development real estate startups

PLANET FINANCE

Nearly USD 9 bn worth of locked-up BTC is about to hit the market — what does it mean for prices?

Some USD 8.7 bn worth of locked-up BTC is about start hitting the market — that can’t be good for the price of the cryptocurrency, can it? Creditors of collapsed Japanese BTC exchange Mt. Gox may start to see BTC and BTC cash trickling into their accounts as early as this week, dumping fresh supply into the market, CNBC reports. About 140k BTC is about to be released, Coindesk adds.

The impetus to sell will be significant because BTC is worth a whole lot more than when these folks lost access to their funds. Creditors getting BTC from Mt. Gox starting this week have been waiting for a decade — Mt. Gox collapsed when BTC was at USD 600 per coin. It’s north of USD 61k now.

Take it and run? Many of those getting payments this month will sell out of the asset class and “enjoy the fact that having their assets stuck in the Mt. Gox bankruptcy was the best investment they ever made,” John Glover, chief investment officer at Toronto-based crypto startup Ledn, told CNBC.

And there’s the risk that lower summertime liquidity in the market could see all that coin land with a thud that depresses prices: Pundits worry the inflow will start as many in the market have their eyes on the beach, not their trading screens.

ALSO WORTH KNOWING- Apple has just joined OpenAI’s board “in an observer role,” the Financial Times writes. The agreement came after Apple agreed to integrate ChatGPT into iOS 18, its next operating system now in beta testing and due to the market this fall.

It’s a weird move for a bunch of reasons: For starters, Apple rival Microsoft is (effectively — it’s complicated) a 49% owner of OpenAI. And Apple and OpenAI can’t exactly be said to share the same values when it comes to things like intellectual property rights and privacy.

Apple’s Phil Schiller will have a non-voting observer seat on the board — the same as Microsoft does.

MARKETS THIS MORNING-

Major Asian benchmarks are mostly in the green in early trading this morning, with the ASX 200, Nikkei, and Hang Send all in the green, the Kospi flat, and the Shanghai Composite in the red. Futures for the top European benchmarks are up slightly in overnight trading, while Wall Street futures are largely flat after the S&P 500 closed above 5.5k yesterday for the first time.

Somewhere, a bear is hungry: BCA Research is one of a handful of outfits suggesting the US economy could fall into recession later this year or early next, sending the S&P 500 down by as much as 30%. (Fox Business | MarketWatch)

EGX30	27,986	+0.1% (YTD: +12.4%)
USD (CBE)	Buy 48.11	Sell 48.24
USD (CIB)	Buy 48.11	Sell 48.21
Interest rates (CBE)	27.25% deposit	28.25% lending
Tadawul	11,606	-0.5% (YTD: -3.0%)
ADX	9,088	+0.3% (YTD: -5.1%)
DFM	4,063	+0.2% (YTD: +0.1%)
S&P 500	5,509	+0.6% (YTD: +15.5%)
FTSE 100	8,121	-0.6% (YTD: +5.0%)
Euro Stoxx 50	4,906	-0.5% (YTD: +8.5%)
Brent crude	USD 86.24	-0.4%
Natural gas (Nymex)	USD 2.46	+0.9%
Gold	USD 2,333.40	-0.2%
BTC	USD 61,991.10	-2.1% (YTD: +46.6%)

THE CLOSING BELL-

The EGX30 rose 0.1% at yesterday’s close on turnover of EGP 4.3 bn (1.1% below the 90-day average). International investors were the sole net sellers. The index is up 12.4% YTD.

In the green: Alexandria Containers and Cargo Handling (+6.9%), Ibnsina Pharma (+5.1%), and Qalaa Holdings (+3.6%).

In the red: AMOC (-3.2%), Eastern Company (-2.9%), and Eipico (-2.6%).

CORPORATE ACTIONS-

#1- An EGP 1 bn block trade on Fawry: An EGP 1 bn block trade transaction was executed on Fawry’s shares on Monday, Mubasher reports, citing market data. Some 170.2 mn shares were sold. Meanwhile, Fawry shareholder Link Holdco BV disclosed that it sold some 3.4 mn company shares in an EGP 20.7 mn on the EGX, offloading a 0.11% stake in the company, according to an EGX disclosure (PDF). EFG Hermes acted as the broker on the transaction.

#2- Palm Hills is buying back some 88.2 mn treasury shares — representing some 3% of the company — after its board approved the move, the company said in an EGX disclosure (pdf). The transaction is being brokered by EFG Hermes and will wrap up on 31 July.

Tags:

cryptocurrency Financial Markets Planet Finance

HARDHAT

Egypt has big dry port plans — where do they currently stand?

More dry ports incoming. The House Transport Committee last week approved a draft decision put forward by the cabinet to grant Medlog, the cargo subsidiary of Italy’s Mediterranean Shipping Company (MSC), the rights to to design, construct, operate, maintain, and finance the new Tenth of Ramadan dry port and logistics center. The greenlight pushes forward a project that has been in the making for close to two years.

Project details: The project will be carried out under a 30-year public-private partnership (PPP) contract. The 250-feddan dry port aims to serve the industrial area in Badr, Ain Sokhna, East Port Said, the New Capital, and the Tenth of Ramadan. Medlog inked a contract with the government to set up the dry port back in August 2023.

The timeline: The Transport Ministry launched a tender for the port in 2022 and MSC was awarded it in June 2023.

Hot on the heels of the Sixth of October dry port: The October Dry Port Company (ODP) is setting up the USD 60 mn Sixth of October dry port under the build-operate-transfer structure — ODP is a JV firm established as a special purpose vehicle in Egypt to implement the project. The company is 70% owned by El Sewedy Electric, while 20% is held by SLP for Logistic Properties and 10% by Schenker Egypt.

Already proving fruitful: While the port is still in its trial phase, it has already proved to be a success. The dry port has successfully served six nearby industrial zones, connecting them to the Alexandria Port. This has enhanced the competitiveness of locally-produced products for export through lowered transportation and storage costs, Secretary-General of the Chamber of Transport and Logistics Amr El Samadony told Enterprise.

Part of a bigger, more ambitious plan: Egypt wants to become a global trade and logistics hub through a package of multipurpose transport projects — this includes developing Egyptian seaports and connecting them to production and distribution areas via rail, river, and road networks. The country wants to create integrated logistical hubs that connect ports to one another and establish dry ports and logistics areas that will enhance existing infrastructure by providing storage, distribution, and clearance locations.

Put it in numbers: The Transport Ministry wants to set up a total of 25 dry ports and logistic zones across the country, which will feed into an even bigger plan of creating seven logistical corridors supporting Egyptian trade. This includes 10 dry ports and 15 logistic zones across various areas — including Sixth of October, Tenth of Ramadan, Sadat City, New Damietta, New Fayoum, Beni Suef.

This will mean more storage capacity: The expansion plan for dry ports aims to increase storage space — a significant area of return on investment for the project, said El Samadony. At the same time, this expanded storage space reduces costs for factories by allowing goods to be transported in bulk to storage at dry ports and then to customs offices to complete all procedures for export so that they can be immediately sent to ships at Egyptian ports. This significantly lowers transport costs associated with multiple shipping and handling transfers and reduces the pressure on seaports and different wharfs, freeing up the transit trade.

More room for private sector involvement: This plan for port development is progressing but faces some hurdles which will open the door for the private sector to play a more significant role, a source in the port sector told Enterprise. They noted that the progress made in port and infrastructure development, wharf expansion, and other related projects has made the sector more attractive for investment.

Case in point: Last year, ADQ-owned AD Ports inked a 30-year concession agreement to develop and operate a container terminal at Safaga Port.

The bigger picture: More dry ports will help the country establish integrated industrial and logistics zones to serve the private sector.

A lower budget for port development: The Transport Ministry’s Public Authority for Land and Dry Ports’ investment budget for the current fiscal year is 54% lower than that of the year before, with EGP 263.2 mn allocated for investment.

An asset as local freight rates increase: El Samadony mentioned that the importance of dry ports will soon become obvious in light of the increase in local freight costs, which have risen by 15-18% and are expected to rise further if diesel prices increase.

What’s next? The Transport Ministry is expected to have tendered off ten dry ports by 2025 — the government will soon launch a tender for companies hoping to manage and operate the Shaq El Tebaan dry port.

Tags:

Hardhat infrastructure logistics transport

CALENDAR

2024

JULY

2-3 July (Tuesday-Wednesday): Aswan Forum for Sustainable Peace and Development, Cairo, Egypt.

4 July (Thursday) S&P Global to publish Egypt’s PMI figures for June.

7 July (Sunday): National holiday in observance of Islamic New Year (TBC).

10 July (Wednesday): CBE and Capmas to publish inflation data for June.

10-11 July (Wednesday-Thursday): The Japan-Arab Economic Forum, Tokyo.

16-17 July (Tuesday-Wednesday): The Egypt Mining Forum, Cairo, Egypt.

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

23 July (Tuesday): Revolution Day (national holiday).

AUGUST

4-5 August (Monday-Tuesday): Egypt Expat Forum.

SEPTEMBER

3-5 September (Tuesday-Thursday): Egypt International Airshow, El Alamein International Airport.

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

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

25-26 September (Wednesday-Thursday): The Asian Infrastructure Investment Bank’s (AIIB) 2024 annual meeting, Samarkand, Uzbekistan.

OCTOBER

6 October (Sunday): Armed Forces Day.

17 October (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

13-17 October (Sunday-Thursday): Cairo Water Week, Water and Climate: Building Resilient Communities, Cairo, Egypt.

21-27 October (Monday-Sunday): The World Bank and IMF annual meetings.

30 September (Monday): Ban on sugar exports expiration.

NOVEMBER

4-8 November (Monday-Friday): World Urban Forum, Cairo, Egypt.

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

26-28 November (Tuesday-Thursday): Egypt Energy Show, Cairo, Egypt.

DECEMBER

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

EVENTS WITH NO SET DATE

June 2024: Gov’t expects to finalize sale of Beni Suef combined-cycle power plant.

1H 2024: Gov’t expects to finalize sale of four water desalination plants.

2H 2024: Gov’t to launch the Cairo Ring Road BRT buses.

3Q 2024: Egyptian-Armenian Joint Committee.

November 2024: Egypt to host the World Urban Forum (WUF12).

End of 2024: The launch of the high-speed train line linking Ain Sokhna with Al Alamein City.

End of 2024: Shalateen Mining Company to launch a gold exploration tender in the Eastern Desert.

2025

EVENTS WITH NO SET DATE

2Q 2025: Safaga Terminal 2 to start operations.

2027

20 January-7 February: Egypt to host the African Games

EVENTS WITH NO SET DATE

End of 2027: Trial operations at the Dabaa nuclear power plant expected to take place.

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