CBE holds interest rates steady, meeting analyst expectations

1

What We're Tracking Today

Sultan Haitham bin Tarek Qaboos is in Egypt today

Good morning dear readers: Last week’s rapid-fire news flow doesn’t seem to have let up much over the weekend, with the MPC meeting, an update on the Safi / Wataniya sales, and new unemployment figures all making news since EnterpriseAM last landed in your inboxes on Thursday morning. Let’s get to it.

HAPPENING TODAY-

Oman sultan in town: Oman’s Sultan Haitham bin Tarek is landing in Egypt for an official two-day visit on the invitation of President Abdel Fattah El Sisi, according to the Oman News Agency. Six MoUs covering a number of fields including education, tax transportation, and aviation will be signed during the visit, Oman’s ambassador to Cairo Abdullah bin Nasser bin Musalam Al Rahbi told the state-run MENA news agency.

We know about one of these agreements: The Finance Minister said recently that the two countries will this month sign a double taxation treaty.

National Dialogue, week 2: The dialogue has four politics-centered sessions scheduled for theday: two discussing the future of political parties and two on the local council law. Thursday’s sessions, on issues related to national identity and the issue of guardianship over money, had around 480 attendees who were engaged in discussions for 7 hours. You can catch the sessions on the dialogue’s Facebook page.

Senate reconvenes: The Senate is back in session after a two-week break and its committees have a packed Sunday ahead:

The Senate General Assembly will discuss the export potential of our pharma industry;
The Industrial Committee will look into the economic challenges faced by industrial firms;
The Energy Committee will discuss the fertilizer industry, carbon tax, and the performance of the Egyptian General Petroleum Corporation;
The Tourism Committee will hold a session on promoting religious tourism.

There’s an election happening across the Med: Greek voters go to polls today to decide the country’s next government, and the final polls are pointing to the prospect of a coalition government. Conservative incumbent Prime Minister Kyriakos Mitsotakis is slightly ahead of the leftist Syriza party but looks unlikely to get enough votes to form a government. Reuters has more.

HAPPENING TOMORROW-

The African Development Bank’s (AfDB) annual meetings kick off in Sharm El Sheikh. The theme of this year’s meetings, which run until Friday, is “mobilizing private sector financing for climate and green growth in Africa.” Hassan Abdalla, Central Bank of Egypt governor and chair of the AfDB’s board of governors, welcomed participants to the meetings in a video message over the weekend (watch, runtime: 05:37).

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

THE BIG STORIES ABROAD-

There a number of stories jostling for attention in the global front pages this morning:

#2- Russia claims to have taken a key city in Ukraine: The Russian defense ministry said this morning that Russian troops and soldiers from private military contractor Wagner are in full control of Bakhmut following an eight-month battle for the east Ukrainian city. Ukraine is yet to respond to the claim. (Associated Press | Reuters | Washington Post | New York Times | Wall Street Journal)

#3- Zelenskiy at the G7: The appearance of Ukrainian President Volodymyr Zelenskiy at the ongoing G7 summit in Japan is dominating coverage of the event. During the three-day summit, which finishes today, western powers have announced fresh sanctions targeting Russian exports and are planning new measures to respond to China’s “economic coercion.” (Associated Press | Reuters | Financial Times | Bloomberg | New York Times | CNBC)

PSA- EGX-listed companies can account differently for FX losses on the back of the EGP devaluation: The government has made amendments to local accounting standards that allow companies to account separately for losses that came as the direct result of the EGP’s recent devaluation, per a decision in the Official Gazette. Companies can use the different accounting method for financial results spanning the period from 27 October — when the EGP was allowed to slip against the USD as the central bank moved to a flexible foreign-exchange rate regime — to the end of 2023, the Financial Regulatory Authority saidWednesday.

DATA POINT-The expat car import initiative raised some USD 900 mn, with almost USD 370 mn of that already transferred to the government, Al Shoroukquotes Finance Minister Mohamed Maait as saying last week. That’s a little over a third of the USD 2.5 bn originally targeted by the ministry. Some 167k Egyptian expats reportedly registered for the scheme, which wrapped on 14 May after it was extended for three months in a bid to maximize FX inflows.

COME WORK FOR OUR ADVISORY ARM-Enterprise Advisory (formerly known as Inktank Communications) is looking for smart, talented people to help us tell the stories of exciting companies. Enterprise Advisory is the region’s leading investor relations advisory company and works on investor and strategic communications issues that take you deep inside the c-suite. Our clients are in Egypt, Saudi Arabia, the UAE and beyond. Egyptian and foreign nationals alike are welcome to apply.

We’re running a four-month training program for fresh grads and career switchers and will hire every successful grad of the program.

Apply directly to jobs@enterprisemea.com and mention “advisory development program” in your subject line.

The TriFactory's Somabay Endurance Festival returns for the fifth time from 25-27 May,bringing together Egypt's multi-sport community for an amazing weekend filled with swimming, cycling, and running throughout the beautiful scenery of Somabay. Select from six different races, Sign up now, and get ready to Experience Endurance.

Central Bank of Egypt holds interest rates steady

The Central Bank of Egypt (CBE) kept interest rates unchanged on Thursday after inflation eased slightly in April, it said in a statement (pdf) following its policy meeting. The Monetary Policy Committee (MPC) left the deposit rate at 18.25%, the lending rate at 19.25%, and the main operation and disc. rates at 18.75%.

The rationale: The CBE said it would hold rates as it continues to assess the impact of the 1k-bps worth of rate hikes implemented in the past 15 months — including the large 200-bps increase the MPC made at its last meeting in March — as well as the 400-bps increase it made in September to the required reserve ratio for banks. The MPC statement said its decision was informed by cooling global and domestic inflation on the back of lower energy prices and better supply chain conditions, as well as the “early signs of economic activity slowdown” at home.

REMEMBER- Inflation eased for the first time in 10 months in April, inching down to 30.6% y-o-y from 32.7% the month before, thanks to a favorable base effect, the stabilization of the EGP-USD exchange rate, and a slight slowdown in food price inflation. Consumer prices are widely expected to pick up again in the coming months on the back of an anticipated devaluation, price hikes fordiesel andsubsidized commodities, and seasonal factors including the upcoming Eid.

The CBE’s move was expected: Seven of 10 analysts in our pollpredicted the decision, explaining that April’s cooler inflation reading gives the CBE the room to assess the impact of earlier hikes and avoid raising the cost of public borrowing. Eight of 11 economists in a Bloombergpoll also saw policymakers holding rates steady. CBE Governor Hassan Abdalla last month voiced caution over any further hikes, saying other policy measures may be needed to rein in price hikes and address supply bottlenecks that have pressured imports.

The CBE’s next interest rate move could depend on the FX rate: “I think the key thing is what's happening with the currency issue,” Bloomberg chief EM economist Ziad Daoud told Bloomberg TV (watch, runtime: 6:59), suggesting that the central bank could hike rates if inflation is spurred once more by a further depreciation of the EGP. “Until Egypt resolves it and does the next round of devaluation, they’ll probably hold rates,” he added. Arqaam Capital’s Zeina Rizk told Bloomberg ahead of Thursday’s decision that policymakers “should continue hiking, but it should come in tandem with a devaluation.” The EGP hasn’t moved against the USD since mid-March after losing more than half of its value against the greenback in the past year.

EGP WATCH-

EGP rallies on black market amid dampened USD demand: The EGP has gained 12% on the parallel market over the past week to come in at 37 to the USD on Thursday, up from 42 the previous Friday, Bloomberg reports. The upturn comes on the back of weakened demand for the greenback, triggered in part by requests from the Egyptian Automotive Dealers Association to its members to stop buying from the black market, the news outlet reports.

The next deval is looking increasingly distant: The EGP’s one-month non-deliverable forwards (NDFs) gained 2.4% to about 31.8 to the USD on Thursday — its strongest since 2 March and down from a record high of 35.3 on 25 April — suggesting that traders see the local currency falling at a softer pace than previously thought. The official exchange rate has sat at 30.96 since 12 March.

Adnoc leads the race to snap up shares in Wataniya

Adnoc eyes a stake in Wataniya: Abu Dhabi National Oil Company (Adnoc) is among several companies interested in acquiring a stake in military-owned fuel retailer Wataniya, sources close to the transaction confirmed to Enterprise yesterday, following a report by Asharq Business.

A Saudi-Emirati competition: Adnoc is competing against an unnamed Saudi company for a stake in Wataniya, one of our sources said, without naming the Saudi firm. Asharq quotes its sources as saying Saudi industrial oils giant Petromin and Emirates National Oil Company (ENOC) have also shown interest in the fuel retailer.

Emirati bidders want at least 20-25% of Wataniya and military-owned bottled water company Safi,Asharq quotes its sources as saying. F&B company Agthia — which is owned by Abu Dhabi sovereign fund ADQ — is among several bidders for Safi, a source close to the transaction confirmed to Enterprise last week.

REMEMBER- The Madbouly cabinet has said that both Safi and Wataniya would start receiving offers from strategic investors this month. The government has reportedly tapped CI Capital to market the two firms.

Do strategics only want part of Safi?The bottled drinks firm has attracted attention from both local and foreign investors but potential buyers are keen to buy the water business on a standalone basis without the firm’s olive oil, pickled olives, and salt subsidiaries, Asharq reports its sources as saying.

More momentum for the privatization program? The government last week made the first significant transaction in its privatization program, raising EGP 3.75 bn through the sale of a 9.5% stake in Telecom Egypt to mostly local institutional investors on the EGX. The government aims to raise USD 2 bn via asset sales by the end of June.

Egypt unemployment inches down to 7.1% in 1Q 2023

Egypt’s unemployment came in at 7.1% in 1Q 2023, down 0.1 percentage points from thefinal quarter of 2022, according to data from statistics agency Capmas. The jobless rate was also down 0.1 percentage points from the same period last year.

REMEMBER- The headline rate doesn’t tell the whole story: The unemployment rate doesn’t count people of working age who are not looking for jobs or who are unable to work. The labor force participation rate — which counts everyone aged 15-64 either in work or actively looking for work — rose to 43.0%, up from 42.8% in both the previous year and the previous quarter.

Unemployment among women remained mostly unchanged: The jobless rate among women decreased 0.1 percentage points from the quarter before to 19.2%. Unemployment among men dropped 0.2 percentage points to 4.5%. Unemployment among women is consistently much higher than among men.

The proportion of young people out of work was unchanged from 4Q 2022,with 15-29 year-olds accounting for 63.0% of all jobless people in 1Q 2023. Capmas doesn’t provide an official rate of youth unemployment.

Investors wanting to set up shop in Egypt will get year-long residency

Another attempt to entice foreign investors: Foreign investors can now acquire year-long non-touristic residencies when proposing investment plans to the General Authority for Freezones and Investment (GAFI), Al Mal reported Saturday, citing a decision by the Interior Ministry. The residency can then be renewed for six-month or year-long periods depending on how long it takes to establish the business.

This isn’t the first move to make it easier for foreigners to come to Egypt: Earlier this year the Madbouly governmentmade it possible for foreigners to acquire the green passport if they establish a solo or joint investment project with an USD 350k investment in addition to depositing USD 100k into the state treasury. It came as part of a longer list of ways for foreigners to acquire citizenship in exchange of hard currency, that included property purchases and direct deposits.

The government last week announced a raft of decisions designed to attract foreign capital to the country and solve the ongoing currency crisis. The 22 changes encompass bureaucratic reform aimed at speeding up licensing and improving the transparency of state firms, new financial incentives for certain industries, and legal reforms to improve contract enforceability.

FDI is key for exiting the crisis: Along with its privatization program, the government is trying to boost FDI and export revenues in a bid to increase inflows of foreign currency. Greater FX inflows will help ease the pressure on the EGP and stamp out the black market, giving the Central Bank of Egypt more room to float the currency and resume the IMF program.

Profits up 41% at Egyptian fintech e-finance in 1Q 2023

E-Finance posts strong growth in 1Q 2023: State-owned payments firm E-Finance’s adjusted net income rose 41% y-o-y to EGP 281.9 mn 1Q 2023, according to its earnings release (pdf). Revenues rose 37% y-o-y to record EGP 768.0 mn, largely on the back of growth in the firm’s cloud-hosting and variable-fee transactions businesses.

Digital operations led revenue growth: Growth was driven primarily by the company’s flagship business, E-Finance Digital Operations, which accounted for 93% of the group’s revenues during the quarter. Revenues at Digital Operations rose 40% y-o-y to EGP 716.9 mn thanks largely to the firm’s “lucrative and fast-growing cloud hosting revenue stream,” where revenues more than doubled to EGP 207.6 mn. Transaction-based revenue was up 53% to EGP 327.4 mn, driven by a 78% increase in variable-fee transaction income. Meanwhile, e-commerce subsidiary E-Aswaaq increased revenues more than fivefold to EGP 58.5 mn.

What they said: “Our profitability for the period was driven by the strong results generated by our higher margin revenue streams, as well as management’s diligent and successful efforts at mitigating and reducing our exposure to the impacts of Egypt’s currently unfavorable FX environment,” said Chairman Ibrahim Sarhan.

Looking ahead: E-Finance aims to open a Saudi branch in Riyadh in 2H 2023 after signing anMoU last month to partner with Saudi-based Thiqah Business Services. Saudi sovereign wealth fund PIF became the single-largest shareholder in E-Finance last year after it acquired a 25% stake.

FAWRY NET INCOME TRIPLES-

E-payments giant Fawry’s adjusted net income rose 242% y-o-y to EGP 146.8 mn in 1Q 2023, according to the company’s earnings release (pdf). Revenues were up 40% y-o-y to EGP 675.7 mn. Revenue growth was driven by expansion in the company’s banking services segment, Fawry said, while cost control measures led to higher margins and increased profitability.

Banking services accounted for 50% of Fawry’s revenue growth during the quarter, with the segment booking revenues of EGP 249.9 mn, up 63% y-o-y and accounting for more than a third of the company’s overall revenues. The microfinance segment also posted strong growth, with revenues rising 74% to EGP 82.3 mn, accounting for 18% of top-line growth and 12% of overall revenues. Supply chain solutions — while still a relatively small segment of the business — saw revenues jump 81% y-o-y to EGP 44.6 mn, making up 10% of revenue growth.

What they said: “The successful expansion of our top-line and the consistent effort to control costs at all levels despite challenging economic circumstances has enabled us to expand our margins and add another quarter to Fawry’s success story,” CEO Ashraf Sabry said in the release.

Sudan army, RSF sign 7-day ceasefire pact

New ceasefire pact in Sudan: The Sudanese army and the Rapid Support Forces have agreed to a seven-day ceasefire to bring the fighting to a temporary pause for the first time since the war started six weeks ago. The two sides signed an agreement for a truce to come into effect at 9:45pm Khartoum time on Monday during ongoing peace talks in Jeddah, the mediators of the negotiations, Saudi Arabia and the US, said in a joint statement yesterday. Under the agreement, both sides have committed to facilitating humanitarian aid and pull forces back from hospitals and other essential services.

Previously ceasefires haven’t done anything to stop the fighting: The warring factions have agreed to multiple ceasefires since the war started in the middle of May, only for fighting to continue on the ground.

This time should be different: This is the first time the two sides have committed to a ceasefire in writing, and the arrangements will be supervised by a “US-Saudi and international-supported ceasefire monitoring mechanism,” the statement said, without elaborating.

Chaos in Khartoum: “We are living in the devil’s city. People are looting everything…Where’s the state?” Reuters quotes one Khartoum teacher as saying, as violence intensifies on the street’s of Sudan’s war torn capital. With the RSJ reportedly in control of large parts of the city, eyewitnesses told the newswire that order has all but collapsed, with criminals and militia looting banks, shops, and homes. The Sudanese army has blamed RSF soldiers for much of the criminality, a charge the paramilitary group denies.

More than 1 mn people have now been displaced by the conflict, the UN said Friday. Some 187k have fled into neighboring countries, with more than 113k entering Egypt over the past five weeks, according to the latest UN data.

Aid efforts: The UN’s Central Emergency Response Fund (CERF) is allocating USD 22 mn to support the relief efforts in Sudan’s neighbors, while USAID has announced a USD 103 mn aid package targeting Sudan and its neighboring countries, USD 6 mn of which is going to Egypt, according to a statement.

Arab African International Bank appoints new managing director

The Arab African International Bank (AAIB) appointed Tamer Waheed as its new managing director, succeeding Sherif Elwy (LinkedIn), Al Borsa reports. Waheed served as a board member and before that as head of the risk sector at the bank. Elwy steps down after serving as the bank’s managing director for more than four-and-a-half years.

Waheed on the board: Waheed has also been appointed to AAIB’s board as a non-executive director representing the Central Bank of Egypt, the central bank said in a statement.

Talk shows cover latest on exchange rate, Arab League and National Dialogue

Diplomacy and the economy dominate talk show coverage, with Kelma Akhira’s Lamees El Hadidi bringing us the latest on the USD black market, while Masa’a DMC and Al Hayah Al Youm take us to Jeddah where the Arab League summit took place on Friday.

EGP gains against the greenback: The USD-EGP rate in the parallel market has dropped in recent days from 41-42 to 37-38 as of Thursday, El Hadidi said (watch, runtime: 3:59). While most analysts are citing the newly-introduced custom breaks for gold, other reports are suggesting that demand for USDs is winding down, “which I am not so excited about because it could mean stagnation,” she said. “This is a temporary move if the root of the issue is not tackled.”

It’s all psychological? The gains are largely due to psychological reasons after people realized that it has become easier for gold to enter the country, Egyptian Capital Market Association (ECMA) chairman Mohamed Maher told Kelma Akhira (watch, runtime: 5:41). He reiterated El Hadidi’s comments that EGP gains could be temporary if the state doesn’t work to maintain it, pointing towards the offering program. “There needs to be rapid movement [on the offering program] and movement to sell attractive assets,” he said.

An Arab League summit for the books: Friday’s Arab League summit in Jeddah was notable not just for the anticipated return of Syria to the table but also for the surprise participation of Ukrainian President Volodymyr Zelenskyy. “This summit was different from previous ones,” Saudi political analyst and researcher Mubarak Al Atti told Al Hayah Al Youm’s Lobna Assal (watch, runtime: 5:43).

On Syria: “All Arab issues were discussed, with a special focus on crisis-stricken nations,” Gamal Roshdy, a spokesperson for the Arab League's secretary-general, told Masa’a DMC (watch, runtime: 7:55). “There was a realization that keeping Syria away from the Arab League wasn’t helping resolve its issues or resolve its consequences,” he added. The next step would be seeing the forces in Syria disappear gradually and for Syria to go back to what it used to be, Mohammad Al Ghobari, former director of the National Defense College at Nasser Military Academy, told Al Hayah Al Youm (watch, runtime: 5:26). We have more in this morning’s Diplomacy section, below.

It’s week two of the National Dialogue: Masa’a DMC (watch, runtime: 17:10) and Al Hayah Al Youm (watch, runtime: 6:18) both had segments on the National Dialogue looking at the last week and the next.

Taht El Wesaya and Egypt’s guardianship law spotlit in foreign press

It’s a quiet morning in foreign press with no single story getting a lot of attention. Among the stories getting ink internationally:

Drama series sheds light on guardianship law: The Guardian discusses the impact of the drama series, Taht El Wesaya, which led some MPs to submit amendments to update the 75-year old law. (The Guardian)
Tradition at the heart of Egyptian luxury brands: The global appeal of Arab and Islamic designs has prompted Egyptian designers to turn to traditional crafts and artisans for inspiration. (AFP | watch, runtime: 1:27)
The war in Sudan has consequences for Egypt: The war to Egypt’s south is putting a strain on its already limited resources and adding further pressures on its already struggling economy. (The National Interest)

FinMin announces temporary VAT exemption on imported machinery and equipment. PLUS: Microfirms can borrow more, new PwC center,

TAXATION-

VAT breaks on importing machinery: Companies will be handed a temporary VAT exemption on all imported machinery and equipment used to produce goods or perform services under amendments to the executive regulations of the VAT Law signed off on by the Finance Ministry last week, according to a ministry statement. A reduced 5% rate of VAT is applied to machinery and equipment used to produce goods and services but this will be scrapped for an undefined period of time, the ministry said.

REGULATION-

FRA increases maximum credit limit for micro enterprises: The Financial Regulatory Authority (FRA) has raised the borrowing limit for micro businesses by 10% to EGP 220k, it said in a statement (pdf) last week. The move comes in light of ongoing economic turbulence and the need to help institutions meet their financial obligations, FRA boss Mohamed Farid said. The FRA doubled the credit limit for micro firms to EGP 200k in 2019.

EXPORTS-

Gov’t rolls out the sixth phase of the export subsidy program: The board of the Export Development Fund approved the rolling out of a new phase for the export subsidy program allowing exporters to receive their subsidies in a single payment, according to a Trade Ministry statement on Thursday. Export shipments made before 1 January 2023 are eligible for subsidies in this phase and companies that have submitted their applications before 1 April are set to get paid in July, while applications that will be submitted after that date and before 1 June are set to get paid in August, the statement reads.

Remember: Government spending on export subsidies will almost quadruple to EGP 28 bn in the coming fiscal year.

OUTSOURCING-

Big Four accounting firm PwC has opened a digital outsourcing center in Cairo, it said lastweek. The USD 10 mn Egypt Technology and Innovation Center has so far hired 400 tech experts and expects to create 5k jobs and export USD 300 mn worth of digital services by 2025, according to the Communications Ministry. It will offer services including enterprise resource planning, customer services, cybersecurity, data analytics and business intelligence, cloud solutions, and automation. PwC was among 29 global firms that signed an agreement with the government to up their investments in our outsourcing industry late last year.

DEVELOPMENT FINANCE-

EBRD, EU + ILX pledge EUR 300 mn in private-sector finance: The European Bank for Reconstruction and Development (EBRD), the EU, and EM credit fund ILX have entered a partnership to increase private sector capital in EBRD partner countries, including Egypt, the bank said in a statement yesterday. The three aim to deploy up to EUR 300 mn over the coming three years.

TRANSPORT-

EgyptAir Cargo is returning to Libya’s capital: EgyptAir Cargo recently resumed weekly flights to Tripoli following an 8+ year hiatus, it said Thursday. The airline might increase the frequency of flights based on demand, according to the statement. There are plans to boost the number of regular and charter flights to several Libyan destinations, including Benghazi and Misrata, to expand the company’s air cargo network, he added.

TOURISM-

From Kazakhstan to Sharm: Red Sea Airlines has started operating weekly flights from Kazakhstan’s Almaty and Astana to Sharm El Sheikh,Al Mal reported.

BANKING-

The Central Bank of Egypt has received the ISO security and resilience certification in business continuity management systems from MSECB, the bank said in a statement. The certification reflects the “efforts accomplished by the CBE to ensure the continuity of all its critical activities during times of crises and emergencies.”

DEBT-

Erada Microfinance has secured an EGP 100 mn loan from Banque du Caire to finance its expansion,according to a statement (pdf). The NBFS company was launched in January by the Sovereign Fund of Egypt (SFE) and Etisalat Egypt and aims to improve access to finance for micro and small businesses.

Global debt reaches USD 305 tn in 1Q 2023 -IIF

Global debt is back on the rise: Global debt rose USD 8.3 tn during 1Q 2023 to USD 305 tn, according to Institute of International Finance data picked by Reuters. This is the second-highest amount of global debt ever recorded and is USD 45 tn higher than its pre-pandemic levels “and is expected to continue increasing rapidly,” the report said, pointing to rising defense spending and healthcare costs associated with aging populations.

EM debt crossed the USD 100 tn mark for the first time during the quarter, with China, Mexico, Brazil, India, and Turkey recording the most significant increases.

EM local-currency bonds pick up steam against their USD counterparts: Investors have poured USD 5.23 bn in local currency EM bond funds in the first four months of the year, buoyed by high interest rates and falling inflation in EMs, the Financial Times reports, citing data provider EPFR Global. By contrast, funds holding EM bonds denominated in hard currencies have seen net outflows of USD 2.65 bn.

Strengthening the case for local-currency bonds: Expectations that the US Federal Reserve will hold off on raising interest rates next month. “The view being that with the Fed on pause, that should lower interest rate volatility and create some room for investors to earn the risk premium on offer in specific higher-yielding emerging market foreign exchange,” Goldman Sachs analyst Kamakshya Trivedi told the salmon-colored paper.

Also worth noting this morning:

Aldar closes maiden green sukuk: UAE-based Aldar Investment Properties raised USD 500 mn in its inaugural green sukuk issuance last week, the first of a USD 2 bn program. The issuance was 4x oversubscribed, attracting an order book from local, regional, and international investors of over USD 2.3 bn, closing the final yield at 4.875%. (Aldar statement, pdf)
Bank Dhofar hasn’t given up on Ahli Bank: Bank Dhofar has submitted an improved offer for Ahli Bank in response to a rival bid from Omnivest — a consortium led by Oman International Development and Investment Co. — valuing the bank at around USD 938 mn. Ahli Bank rejected Bank Dhofar’s first merger proposal last month. (Bloomberg)
UBS stands to lose big — and gain bigger — from its buyout of Credit Suisse: UBS is projecting losses of up to USD 28.3 bn on the back of its takeover of the struggling Swiss lender, but expects to offset the losses through a USD 17.1 bn writedown of some of Credit Suisse’s bonds as well as a one-time, USD 34.8 bn gain from acquiring the bank at a heavy discount. (Presentation, pdf | Reuters)
Russia says falling oil revenues “a problem” amid sanctions: Russian oil revenues plummeted by over 50% to RUB 2.2 tn (USD 27.3 bn) in the first four months of 2023. (Financial Times)
Eurozone inflation inched up in April: Price growth in the eurozone edged up to 7.0% in April from 6.9% a month earlier, as rising services and energy prices offset cooling food costs. (Eurostat, pdf) | Reuters)

EGX30	16,746	-0.6% (YTD: +14.7%)
USD (CBE)	Buy 30.83	Sell 30.96
USD at CIB	Buy 30.85	Sell 30.95
Interest rates CBE	18.25% deposit	19.25% lending
Tadawul	11,344	+0.6% (YTD: +8.3%)
ADX	9,479	-0.3% (YTD: -7.2%)
DFM	3,545	-0.3% (YTD: +6.3%)
S&P 500	4,192	-0.1% (YTD: +9.2%)
FTSE 100	7,757	+0.2% (YTD: +4.1%)
Euro Stoxx 50	4,395	+0.6% (YTD: +15.9%)
Brent crude	USD 75.58	-0.4%
Natural gas (Nymex)	USD 2.59	-0.3%
Gold	USD 2,000.30	+1.1%
BTC	USD 27,008	+0.8% (YTD: +63.8%)

THE CLOSING BELL-

The EGX30 fell 0.6% at Thursday’s close on turnover of EGP 1.8 bn. Local investors were net sellers. The index is up 14.7% YTD.

In the green: Ibnsina Pharma (+5.3%), Eastern Company (+3.3%) and Egypt Kuwait Holding - EGP (+3.1%).

In the red: CIB (-2.7%), Elsewedy Electric (-2.0%) and Mopco (-1.6%).

Ukraine’s Zelenskyy, Syria’s Assad top coverage of Arab League summit in Jeddah

Assad officially back in the fold at the Arab League: Syrian President Bashar Al Assad was in Jeddah on Friday for the Arab League summit, officially marking the country’s re-entry to the organization 12 years after it was expelled for its crackdown on Arab Spring protesters. Al Assad said that Arab states had an “historic opportunity” to focus on regional development “with the least amount of foreign interference,” and called his country’s re-entry to the league a “new stage of Arab solidarity.” Qatar was the only member to protest the return of Al Assad to the table, with Qatari Emir Sheikh Tamim bin Hamad Al Thani reportedly walking out of the meeting before the Syrian leader took to the podium.

Remember: The Arab League voted earlier this month to restore Syria’s membership.

Ukrainian President Volodymyr Zelenskiy made a surprise appearance, delivering a speech urging Arab leaders to support Ukraine and reevaluate their ties with Russia (watch, runtime: 0:51). He also underscored Ukraine’s vital role as a major supplier of wheat to the region (watch, runtime: 4:19). The Washington Post,Financial Times,Reuters, and Associated Press all had coverage.

El Sisi made the rounds: President Abdel Fattah El Sisi met with Saudi Prince Mohammed binSalman, Tunisian President Kais Saied, and Lebanese PM Najib Mikati on the sidelines of the summit.

Also worth knowing this morning:

International Cooperation Minister Rania Al Mashat was appointed vice president of the European Bank for Reconstruction and Development’s next annual meeting as it wrapped upthis year’s event in Uzbekistan. (International Cooperation Ministry statement)
Communications Minister Amr Talaat and US Under Secretary of Commerce for International Trade Marisa Lago discussed ways to up cooperation in digital transformation, digital capacity building, data centers, outsourcing, and postal services. (Statement)

CALENDAR

MAY

17-31 May (Wednesday - Wednesday): Second round of applications for sixth phase of export subsidy program.

19-21 May (Friday-Sunday): G7 summit, Hiroshima, Japan.

21 May (Sunday): Senate to reconvene.

21 May (Sunday): National Dialogue session.

22-26 May (Monday-Friday): Egypt will host the African Development Bank (AfDB) annual meetings in Sharm El Sheikh.

23 May (Tuesday): National Dialogue session.

24 May (Wednesday): EFG Hermes will host its extraordinary general meeting.

25 May (Thursday): National Dialogue session.

28 May (Sunday): House to reconvene.

29 May (Monday): IEF-IGU Ministerial Gas Forum, Cairo.

30 May (Tuesday): Listed companies have until this date to report and publish their 1Q results.

JUNE

June: Indian representatives to discuss prospect investments in the Suez Canal.

June: Egyptian-Saudi business forum.

3-4 June (Saturday-Sunday): OPEC+ meeting, Vienna.

7-10 (Wednesday-Saturday): The second edition of Africa Health Excon.

10 June (Saturday): Thanaweya Amma examinations begin.

12 June - 15 July (Monday-Saturday): Thanaweya Amma exams.

13-14 June (Tuesday-Wednesday): Federal Reserve interest rate meeting.

19-20 June (Monday-Tuesday): The forum for insolvency reforms and corporate restructuring in the Middle East and North Africa.

19-21 June (Monday-Wednesday): Egypt Infrastructure and Water Expo debuts at the Egypt International Exhibition Center.

22 June (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

28 June-2 July (Wednesday-Sunday): Eid El Adha (TBC).

30 June (Friday): June 30 Revolution Day.

30 June (Friday): Egypt to exit Grains Trade Convention.

JULY

1 July: House of Representatives deadline to approve the FY 2023-2024 budget.

1 July: GAFI to launch the country’s first integrated electronic platform to facilitate setting up a business.

5 - 6 July (Monday - Tuesday): Gov’t to pay out subsidies to first wave of applicants under its sixth export subsidy program.

15 July (Saturday): Deadline for bids in EGPC’s mature oil fields tender.

18 July (Tuesday): Islamic New Year.

19 - 20 July (Wednesday - Thursday): Gov’t to pay out subsidies to second wave of applicants under its sixth export subsidy program.

20 July (Thursday): National holiday in observance of Islamic New Year (TBC).

23 July (Sunday): Revolution Day.

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

27 July (Thursday): National holiday in observance of Revolution Day.

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.

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

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

19-20 September (Tuesday-Wednesday): Federal Reserve interest rate meeting.

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

21-23 September (Thursday-Saturday): Narrative PR Summit, Somabay.

25 September (Monday): Nasdaq deadline for Swvl Holdings Corp to increase its market value of publicly held shares to a minimum of USD 15 mn.

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

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

OCTOBER

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

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

6 October (Friday): Armed Forces Day.

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

Late October-14 November: 3Q2023 earnings season.

26 October (Thursday): Daylight saving time ends.

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

NOVEMBER

November: Cairo to hostIntra-African Trade Fair.

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

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

DECEMBER

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

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

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.

2023: Egypt will host the Asian Infrastructure Investment Bank’s Annual Meeting of the Board of Governors in 2023.

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.

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

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

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

2Q 2025: Safaga Terminal 2 to initiate operations.

Sections

About

Privacy & Support

Get EnterpriseAM daily