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Monday, 26 Aug 2024

What We're Tracking Today
Real Estate
A Message From Hsbc
Logistics
Debt Watch
Last Night’s Talk Shows
Also On Our Radar
Planet Finance
Blackboard
Calendar

Emirati-Saudi consortium reportedly pulls out of NDP redevelopment project after costs increase on weaker EGP following float

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Today at a glance

1

Real estate

Emirati-Saudi consortium reportedly pulls out of NDP HQ redevelopment project amid rising costs.
2

Logistics

Three terminals to be handed over to operators by year end.
3

DEBT WATCH

Valu closes first EGP 1.1 bn securitized bond issuance under new EGP 16 bn program.
4

What We're Tracking Today

CBE begins lifting import restrictions on 12 of the 13 non-essential goods blocked from getting letters of credit.
5

Also on our Radar

Pharma sector requests raw ingredient customs breaks, packaging VAT breaks.
6

LAST NIGHT’S TALK SHOWS

Hezbollah and Israel’s exchange of missiles dominated the airwaves.
7

Also on our Radar

Menthum, CI Capital Asset Management launch new USD fixed-income fund.
8

PLANET FINANCE

Turkey expected to start cutting sky-high 50% interest rates in November.
9

BLACKBOARD

Dissecting the new Thanaweya Amma system and what it means for international schools.

Monday, 26 Aug 2024

What We're Tracking Today
Real Estate
A Message From Hsbc
Logistics
Debt Watch
Last Night’s Talk Shows
Also On Our Radar
Planet Finance
Blackboard
Calendar
1

What We're Tracking Today

Goodbye, import restrictions?

Good morning, friends. We’re two days into the workweek and the local business news cycle is yet to get into gear. In today’s short and sweet issue, we’ve got important logistics, securitization, and taxation news, plus much more.

BUT FIRST- We have big news for you this morning: EnterpriseAM UAE is now available in Arabic, with the first issue sent shortly after this one. Tap or click here to subscribe and get EnterpriseAM UAE in Arabic directly to your inbox everyday before 8am.

WATCH THIS SPACE-

#1- CBE starts lifting import restrictions: The Central Bank of Egypt has started easing importrestrictions on 12 of the 13 non-essential goods it has previously prohibited banks from issuing credit lines for, sources with knowledge of the matter told Al Mal. The central bank reportedly gave local banks the greenlight to start issuing letters of credit for goods that include mobile phones, food plants and seeds, fresh fruits, cocoa, jewelry, electric appliances, ready-made garments, furniture, and heavy equipment.

Car imports still suspended: The one non-essential import banks are still not allowed to issue credit lines for cars, the sources said.

Remember: The central bank in March 2022 prohibited banks from issuing credit lines for a list of 13 commodities unless the importer had secured the central bank’s approval.

#2- Gov’t wants to give struggling factories some breathing room: The government has asked the Finance Ministry to postpone administrative seizures of indebted industrial facilities as part of a broader initiative to support productive sectors, Al Borsa reports, citing sources it says have knowledge of the matter. Instead, the support initiative may be expanded to allow struggling factories to settle their debts, including tax and ins. dues.

The plan is still up in the air: The instructions are so far verbal and the ministry is still looking into amending the rules of seizing delinquent industrial facilities, Al Borsa quotes an unnamed senior government official as saying.

FROM THE DEBT MARKETS-

Yields on three-month t-bills hit another five-month high: The Finance Ministry sold some EGP 54.1 bn worth of three-month t-bills this week at an average yield of 29.6%, according to central bank data. This marks the highest yield on three-month bills since March, when the rate jumped to 30.2% in an auction following the EGP float. This week’s sale was oversubscribed, reeling in 35.3% more than the EGP 40 bn targeted by the central bank.

PSA-

WEATHER- It’s another summery day in Cairo today, with a high of 36°C and a low of 27°C, according to our favorite weather app.

It’s a bit cooler in Alexandria and along the North Coast, with a high of 32°C and a low of 24°C.

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

** Were you forwarded this email? Tap or click here to get your own copy delivered every weekday before 7am Cairo time — without charge.

ICYMI- Missed this week’s Inside Industry? In our weekly vertical exploring all things industry and manufacturing, we breakdown the past, present, and future of Chinese investments in Egypt. Check out the story here.

HAPPENING THIS WEEK-

UK-Egypt trade and investment in the spotlight: Our friends at HSBC, together with the Egyptian-British Chamber of Commerce (EBCC) and UK Export Finance (UKEF), will host a webinar this week to discuss how to support infrastructure reforms, potential partnerships in Egypt, and ways to support and connect companies around the world. The webinar takes place next Thursday (29 August) from 12-1pm CLT / 1-2pm UAE.

Want to attend? You can sign up here.

The webinar is a scene-setter for the Egypt-UK Investment and Opportunities Forum in London on Monday, 16 September.

Infrastructure is a key part of the forum. The gathering — which follows on from a Juneinfrastructure mission — will focus on promoting trade and investment in infrastructure, with an emphasis on green hydrogen and renewables as well as sectors including the auto industry, food processing, and tech.

Networking: The forum will include both open panels and pre-arranged business-to-business networking. It will also give attendees the chance to meet with government officials and industry leaders. GAFI will be on hand to deliver an economic update.

Want to join them in London? Register your interest in attending the event here.

DATA POINT-

Recently hiked energy bills could save the state some EGP 30 bn this fiscal year, an anonymous government official told Asharq Business. The Electricity Ministry has reportedly begun implementing electricity price hikes that will see household electricity prices rising by 14-40%, with plans to hike electricity prices for the industrial sector for the first time in four years.

CIRCLE YOUR CALENDAR-

#1- You’ll be able to take the BRT soon: The Transport Ministry plans to officially inaugurate the bus rapid transit (BRT) by the end of the year after kicking off trial operations in October, two unnamed government sources told Asharq Business. The bus fare has been set at an initial EGP 16, the sources added.

Remember: The EGP 10 bn BRT project aims to replace microbuses and other forms of public transport on the Ring Road. The first phase runs from the Police Academy in New Cairo to the Alexandria Agricultural Road.

#2- Attention, pharma players: Informa Markets Egypt is hosting Africa’s premier pharma manufacturing exhibition — dubbed Pharmaconex — between 8-10 September at the Egypt International Exhibition Center, according to a press release (pdf). The event will bring together 300 companies from over 20 countries and is expected to welcome 8.5k visitors. You can register to attend here.

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

THE BIG STORY ABROAD-

There are two stories capturing the attention of the global press this morning: An escalation of aggression between Hezbollah and Israel, and Telegram CEO Pavel Durov’s arrest in France.

Israel and Hezbollah exchanged attacks yesterday, with Israel launching “around 100” warplanes into Lebanon in what it said was a preemptive move against an attack from Hezbollah. The group later fired hundreds of rockets into Israel, hitting military targets and killing one Israeli soldier. Hezbollah’s attack was in retaliation for the killing of Fuad Shukr, one of its senior members, in Beirut last month. Although the exchange of fire has raised concerns of regional escalation, both Hezbollah and Israel are “employing the language of containment.” (Reuters | Bloomberg | Financial Times | Wall Street Journal | New York Times | Washington Post)

MEANWHILE IN FRANCE- Telegram founder and CEO Pavel Durov was arrested in France yesterday on several charges, including charges related to the spread of illicit material and misinformation on Telegram due to inadequate moderation and “a lack of cooperation with police.” Telegram said in a statement on X that the platform “abides by EU laws, including the Digital Services Act — its moderation is within industry standards and constantly improving.” (Reuters | Bloomberg | New York Times | Financial Times)

*** It’s Blackboard day: We have our weekly look at the business of education in Egypt, from pre-K through the highest reaches of higher ed.

In today’s issue: We dissect the new Thanaweya Amma system and what it means for international schools.

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Beauty unveiled amidst ancient wonders: Celebrate the beauty, nature, and cultural legacy of 30 nations as Miss Elite 2024 returns to the enchanting shores of Somabay from 2-14 September. For the fourth consecutive year, Somabay is hosting this prestigious international beauty pageant, celebrating women’s beauty and intelligence on a global scale. Experience the fusion of antiquity and modern elegance by attending the Grand Finale on 13 September at Mazeej Soma Beach Platform.

2

Real estate

Emirati-Saudi consortium pulls out of NDP HQ redevelopment project amid rising costs

Gulf consortium backs out of plan to redevelop NDP HQ: A consortium of the UAE’s Al Shafar General Contracting (ASGC) Group and Saudi Egyptian Developers (SED) has backed out of an agreement to work on the USD 5 bn redevelopment of the former National Democratic Party (NDP) headquarters in central Cairo due to increased construction costs following the EGP float, Asharq Business reports, citing an anonymous official within the consortium.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

The why: The consortium’s share in its partnership with the Sovereign Fund of Egypt — which was tied to land and building prices — was altered following the currency's depreciation and the resulting surge in raw material and energy prices.

But this may not be goodbye forever: The two companies could still end up developing the project if their shares in the project are adjusted, the source from the consortium added to the outlet.

The project in question: The redevelopment plan came with a price tag of USD 5 bn to be invested in a 7-star, 220-meter high hotel, residential buildings, and a multi-storey garage with capacity of up to 6k cars, local media previously quoted SFE tourism sub-fund chair Elhamy El Zayat as saying. The project was said to take some six years to complete and could break ground later this year, he added. The project comes as part of a wider plan to redevelop old buildings in central Cairo and make the area more attractive for investment.

Remember: It first came to light that the consortium had been selected to work on the project back in September 2023. Cabinet in March gave Nilus Hotel and Commercial Services and Nilus Residential Services the greenlight to build two commercial and residential towers on the National Democratic Party’s former headquarters after transferring the 16.6k sqm land plot from the Sovereign Fund of Egypt’s (SFE) tourism sub-fund to the two companies in August 2023. The two towers were given the completion date of 2Q 2028.

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3

A MESSAGE FROM HSBC

A closer look on China-Egypt trade corridor

Over the past decade, Egypt’s ties with China have grown from strength to strength with China now becoming one of Egypt’s most important trade partners.

To put this in perspective, the number of Chinese companies operating in Egypt have exceeded 2k with investments totaling USD 8 bn across many sectors, including textile, home appliances, telecommunication, animal feed, and many more.

Beyond the trade investments, China has injected more than USD 16 bn into the Egyptian economy in the form of loans, investments and development projects, according to the Tahrir Institute for Middle East Policy (TIMEP).

China is ready to deepen cooperation with Egypt in various fields including economic and social development, import more high-quality products, and encourage more Chinese enterprises to invest in the country, Chinese Foreign Minister Wang Yi said in January.

ATTRACTIVE SECTORS-

Egypt is North Africa’s biggest market, with a population of over 100 mn, which shows the huge opportunities for Chinese investors.

Infrastructure and construction projects in new Egyptian cities have drawn particular attention from Chinese investors, mainly in Egypt's new administrative capital near Cairo, dominated by the 385-meter-high Iconic Tower, the tallest in Africa, and the Suez Canal Economic Zone (SCZone).

A showcase of Chinese trade partnerships, the SCZone attracted more than 140 companies and investment of over USD 1.6 bn by July 2023.

In March 2023, Hong Kong’s Hutchison Ports invested USD 700 mn in two Egyptian ports, bringing the company’s total investment in the country to over USD 1.5 bn.

China is Egypt’s biggest importer, with USD 17.2 bn in 2022, or 21.6% of total imports, according to the United Nations Comtrade database on international trade.

The IMF deal is expected to stimulate the whole trade corridor, giving a boost to both exports and imports between the two nations. ITC projections for 2027 show exports potential of USD 19.6 bn between China, including Hong Kong, and Egypt.

The main export sectors where the Chinese companies could benefit are electronic equipment, machinery and electricity, as well as chemicals, with estimated export gaps of USD 2.7 bn, USD 1.6 bn, and USD 636 mn, respectively, according to the ITC.

In the opposite direction, the Egyptian businesses could focus on exports of precious metals, plastics, and rubber, as well as chemicals to China with estimated export gaps of USD 130 mn, USD 84 mn, and USD 69 mn, respectively, the ITC says.

Over time, Chinese investments in Egypt have evolved from mainly focusing on contracting and infrastructure to manufacturing, including smartphone manufacturing, household appliances, and textiles.

Such export-oriented investments across several sectors are expected to boost Egypt’s exports, helping fulfill its ambition of becoming a regional export hub.

Also, the government’s strong support for renewables is paving the way for green-minded Chinese businesses.

This interest is already clear as the Egyptian government signed a memorandum of understanding with China Electric Power Equipment and Technology Company to develop a 10-gigawatt solar energy project. Also, the SCZONE signed USD 15.6 bn in agreements with Chinese partners for 11 manufacturing and green hydrogen projects.

Egypt has played an important role in China’s Belt and Road Initiative due to its strategic location that makes it a vital trade route connecting the Middle East and Africa. This is the right time for Egyptian businesses to accelerate dialogue and engagement with Chinese investors to showcase the expansive trade and investment opportunities the country has to offer.

As the largest international bank in Egypt and because of our long-standing heritage in China, HSBC is ideally positioned to serve the multi-dimensional needs of Chinese businesses looking to invest in the country's fast-growing economy.

By Ali Taqi, Managing Director, Head of Commercial Banking, HSBC Bank Egypt

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4

Logistics

Three Egyptian terminals to be handed over to operators by year end

Three maritime terminals seeking operators: Alexandria Port Authority is gearing up to hand over three maritime terminals to local and foreign operators before the end of the year, Chairman Ahmed Hawash told Al Mal.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

#1- Alexandria Port’s passenger terminal: Five companies are hoping to secure the contract to manage and operate the Alexandria Port’s passenger terminal. A committee is currently evaluating the bids ahead of picking the winner, Hawash said.

Details: The terminal has the capacity to accommodate four large cruise ships and 5k tourists. It includes a duty-free area and a commercial center.

#2- Dekheila dry bulk terminal: Several local consortiums are competing to manage and operate the dry bulk terminal at Dekheila Port, according to Hawash. The 300k square meter dry bulk terminal was reportedly to be awarded to a consortium of three local firms, which were said to invest some USD 50 mn in the first phase of the project.

#3- Container terminal handover imminent: A consortium of Hutchison Ports, Cosco, CMA CGM, and Italy’s Mediterranean Shipping Company (MSC) is set to take over a container terminal at Dekheila Port. The group will manage, operate, and maintain the terminal for a 30-year period.

We heard this before: The government in March 2023 signed two agreements totalling USD 1.6 bn — one with the Hutchison Ports-led consortium, excluding MSC, to construct a new terminal at Sokhna port, and the other, which included MSC, to develop a terminal in the Dekheila port.

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5

DEBT WATCH

Valu closes first EGP 1.1 bn securitized bond issuance under new EGP 16 bn program

Valu takes another batch of securitized bonds to market: Homegrown fintech leader Valu has raised EGP 1.1 bn in a securitized bond issuance, according to a statement (pdf) from the company. Backed by a receivables portfolio, the bond came in two tranches with tenors of six and 12-months with ratings of Prime 1 and Prime 2.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

A fresh securitization program: The issuance is the first under a newly approved EGP 16 bn securitization program. This is Valu’s 11th securitized bond issuance and follows an EGP 1.2 bn issuance last month.

Who bought in? EFG Hermes and the Arab African International Bank were underwriters and Bank ABC was among those who subscribed to the issuance.

Advisors: EFG Hermes was the sole financial advisor, transaction manager, bookrunner, and arranger on the issuance. AAIB also served as the custodian bank. Dreny & Partners was legal counsel, while Baker Tilly served as the auditor.

DATA POINT- The transaction brings the total value of securitized bonds issued in Egypt so far this year to EGP 18.5 bn, according to data tracked by Enterprise. This is around 40% of the EGP 46.0 bn raised in the same period last year.

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6

LAST NIGHT’S TALK SHOWS

Hezbollah and Israel’s exchange of missiles dominated the airwaves

It was another conflict-heavy night on the airwaves last night, with the nation’s talking heads honing in on Israel and Hezbollah’s missile exchange and a meeting between President Abdel Fattah El Sisi and US Joint Chiefs of Staff Chairman General Charles Q. Brown.

Hezbollah exchanged heavy fire early Sunday morning, after Israel launched a “preemptive strike” on Hezbollah positions in southern Lebanon, while Hezbollah responded by firing hundreds of rockets and drones at Israeli military targets in retaliation for the assassination senior Hezbollah commander Fouad Shukr last month.

Hezbollah’s response carries several messages, Lebanese political analyst and writer Mohamed Saeed Al Roz explained in a phone call with Salet El Tahrir’s Faten Abdel Maaboud (watch, runtime: 5:52). The main message is that the group can still act as a deterrence, which has been the linchpin of their existence since 2006 and defines their role in the resistance, he said. Ala Mas'ouleety’s Ahmed Moussa also analyzed the attack with military expert Samir Farag (watch, runtime: 19:32).

El Sisi + Brown: The pair discussed regional developments, with El Sisi underscoring the need for the international community to intensify efforts to diffuse tensions across the region, according to an Ittihadeya statement. In the meantime, Brown expressed the US’ eagerness to expand joint military cooperation in bid to “serve both countries' mutual interests while supporting stability and peace in the Middle East,” the statement reads. Ala Mas'ouleety’s Ahmed Moussa had coverage (watch, runtime: 3:22).

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7

Also on our Radar

Pharma sector requests raw ingredient customs breaks, packaging VAT breaks. PLUS: pharma monopolies beware, Menthum + CI Capital, Palm Hills Developments, Kraft Heinz

PHARMA-

#1- Pharma players want customs, tax breaks: The Federation of Egyptian Industries’ (FEI) pharma division has submitted a request to introduce customs exemptions for inactive ingredients, division member Maged George told Al Arabiya. Pharma players also requested VAT breaks for the sector’s packaging input, FEI tax committee head Mohamed El Bahy said.

It’s been a busy few months for the sector: Some med prices were hiked an average of 25%inJuly. Pharma players have been calling for the government to green light hiking prices in response to inflationary pressures and the new EGP exchange rate against the greenback following the float in March cranking up the cost of raw materials, which are 90% imported, according to FEI pharma division head Ali Auf.

#2- ECA cracks down on local pharma monopolies: The Egyptian Competition Authority (ECA) has notified the FEI’s pharma division that 42 local pharma players are in violation of competition and monopolistic practices laws, according to a letter seen by Al Mal. The letter claimed that it was proved that companies had worked in cahoots to reduce pharmacists’ profit margin. The named companies must now comply with the law and end any monopolistic practices.

#3- Gov’t wants international pharma players to join our pharma raw material hub: The government will be meeting with international pharma players over the coming period to invite them to take part in the EGP 80 mn regional hub for pharma raw materials, according to a cabinet statement.

Remember: Egypt wants to set up a pharma raw material hub to meet the local market needs and regional exports. The Arab Company for Drug Industries and Medical Appliances and Eipico will break ground on the project, with plans to add more private investors at a later stage.

CAPITAL MARKETS-

A fresh USD investment fund: Egyptian digital money market fund Menthum and CI Capital Asset Management launched a USD fixed-income fund — dubbed the Menthum USD Fixed Income Fund — according to a press release (pdf). The fund “aims to deliver stable returns by investing in low-risk, high quality fixed income securities, including USD-denominated t-bills and Eurobonds issued by the Egyptian government.”

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

Interested? Customers can subscribe to the fund through the Menthum app starting today.

REAL ESTATE-

What does Palm Hills have in store for Saudi Arabia? Palm Hills Developments is looking into a number of projects in both the real estate and education sectors in the kingdom, Co-CEO Hazem Badran told Asharq Business, adding that both the higher ed and k-12 sectors are on the company’s radar (watch, runtime: 6:02). The company is eyeing projects in Jeddah, Riyadh, and in the north of the country..

Remember: Palm Hills set up a Saudi branch earlier this month, joining other Egyptian real estate players that have recently entered the kingdom.

MANUFACTURING-

Kraft Heinz doubles production capacity: Kraft Heinz is set to inaugurate USD 50 mn expansions to its factory in Egypt next month, doubling its production capacity and increasing exports by 65%, according to an Investment Ministry statement.

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8

PLANET FINANCE

Turkey expected to start cutting sky-high 50% interest rates in November

Turkey’s interest rate could be halved by the end of 2025: The Turkish central bank could be set to begin a cycle of rate cuts starting November that would carry through until the end of next year, the CEO of Turkey's largest private bank Isbank, Hakan Aran, told Bloomberg. Aran sees the bank halving rates to 25% by 2025 from their current 50%.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

The bank kept interest rates unchanged at 50% for a fifth consecutive month last week. The bank last hiked rates in March as part of a wider tightening cycle that began a little over a year ago following the re-election of Turkish President Recep Tayyip Erdogan. The central bank has raised rates by a total of 4,150 basis points since June 2023.

“I am not worried about a hard landing or a recession,” Aran told Bloomberg. “I believe the current policies will both lead Turkey to attain price stability and maintain growth, albeit slower than its potential,” he said. The CEO sees growth rates slowing to 3.5% and inflation to 42% by the end of the year, down from the current 62%. Akan’s prediction is slightly less optimistic than that of the central bank, which is targeting year-end inflation of 38%.

Remember: Turkey’s economic policy has been seeing something of a turnaround — one that has caught the eye of investors, with nearly USD 30 bn being channeled from abroad into Turkish stocks and bonds since May 2023. Many point to the appointment of former economy chief Mehmet Simsek as treasury and finance minister as the turning point that set the country on its current trajectory, with Simsek’s stint seeing a reversal of decades of unorthodox monetary policy that saw the Turkish central bank cut interest rates in the face of double-digit inflation.

MARKETS THIS MORNING-

Asian markers are mixed in early trading this morning as traders weigh up dovish comments from senior US Fed officials and the risk of a regional war breaking out in our part of the world as Israel and Lebanon’s Hezbollah exchange missiles. Japan’s Nikkei is down 1.2% and China’s Shanghai index is essentially flat, while Korea’s benchmark Kospi is up 0.2%.

EGX30

30,074

-0.2% (YTD: +20.8%)

USD (CBE)

Buy 48.72

Sell 48.86

USD (CIB)

Buy 48.73

Sell 48.83

Interest rates (CBE)

27.25% deposit

28.25% lending

Tadawul

12,263

+0.6% (YTD: +2.5%)

ADX

9,374

0.0% (YTD: -2.1%)

DFM

4,293

-0.4% (YTD: +5.7%)

S&P 500

5,635

+1.2% (YTD: +18.1%)

FTSE 100

8,328

+0.5% (YTD: +7.7%)

Euro Stoxx 50

4,909

+0.5% (YTD: +8.6%)

Brent crude

USD 79.02

+2.3%

Natural gas (Nymex)

USD 2.02

-1.5%

Gold

USD 2,546

+1.2%

BTC

USD 64,236.60

+0.1% (YTD: +51.9%)

THE CLOSING BELL-

The EGX30 fell 0.2% at yesterday’s close on turnover of EGP 4.4 bn (19.7% above the 90-day average). Local investors were the sole net buyers. The index is up 20.8% YTD.

In the green: Palm Hills Developments (+11.8%), Ezz Steel (+4.0%), and Juhayna (+4.0%).

In the red: Eastern Company (-3.0%), GB Corp (-2.9%), and Alexandria Containers and Cargo Handling (-2.8%).

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Our weekly deep dive into education in Egypt, from K-12 to post-secondary.

Published every Monday in EnterpriseAM.

Read Blackboard
9

BLACKBOARD

Dissecting the new Thanaweya Amma system and what it means for international schools

What does the new Thanaweya Amma system mean for foreign certificates? The Education Ministry earlier this month announced a new, revamped Thanaweya Amma system that aims to compete with equivalent foreign certificates. The new system reduces the number of subjects required for high school students and puts a larger emphasis on critical thinking and analysis — a move which could hurt demand for private and international schools.

THE NEW SYSTEM AT A GLANCE-

The revamped system in a nutshell: Starting the upcoming academic year, only six subjects will count toward the final grades of first- and second-year students in high school, down from ten and eight, respectively. Meanwhile, third-year students will only take five graded subjects instead of seven. Second foreign languages, geology, and psychology will all become pass/fail subjects, meaning they won’t impact the final grade.

The goal: The new system aims to help students develop strong analytical and practical skills, rather than merely having superficial knowledge of the curriculum.

It won’t be easy: Some students may struggle to adjust to the new teaching styles that are more focused on practical application rather than memorization, according to the Education Ministry.

A lifeline for teachers: Teachers whose subjects have been removed from the Thanaweya Amma curriculum will be given financial incentives and support to help them take on other subjects, provided that they “demonstrate commitment to implement the new system.” They will be evaluated based on the new system’s standards.

THE PRIVATE SCHOOLS TAKE-

Private school owners are not worried, with those we have spoken to downplaying concerns about the new system, affirming that the demand for these international certificates persists due to the quality of the education provided, as well as the future they offer students. Additionally, there continues to be a significant gap between the number of private schools and the actual demand due to an insufficient number of classrooms in private and international schools amid high birth rates.

The government has no intention of competing with the private sector, our source added — instead, it’s looking to bring balance to the education sector and improve demand for different educational systems, while ensuring that education is provided fairly among different social segments.

Demand for education is on the rise: The population growth rate vastly exceeds the number of schools being established to accommodate new students each year, our source noted, adding that the gap between the number of classrooms needed for pre-university education is growing rapidly each year.

Enter the private sector: The growing demand for education opens the door for private players to expand their investments in the sector, the source added. Meanwhile, the number of new private schools being established is on the decline, with a comparatively limited number of new licenses being issued for private schools in Cairo, Giza, and Alexandria, Association of Private School Owners in Egypt head Badawi Allam told Enterprise.

Prepare for more private investments in the education sphere: The Education Ministry will meet with representatives of private and international schools to encourage investments in the education sector, Allam said, adding that the government and private sector progress in tandem with each other when it comes to education — which leads to a boost in the overall quality of education.

What do private players want? Investors want the General Authority for Educational Buildings to reduce building requirements, which will in turn lower investment costs in the education sector, and for the government to allocate land with facilities similar to that granted for industrial and real estate development, which Allam says would bring significant investments to the sector.

Remember: Despite government incentives aimed at attracting funds into the education sector, private investment continues to be stifled by a number of headwinds — rising costs due to inflation and high interest rates, coupled with inflexible tuition fees, threaten to squeeze investor margins. We dived deeper into what the government is doing to boost private education investment in a Blackboard published earlier this summer.

THE NEW SYSTEM ISN’T WITHOUT FLAWS-

The new system has good ideas — but there’s no way to judge its efficacy without seeing it in action, Allam said. One of the main goals of the new system is cracking down on unlicensed private tutoring centers — closing the private tutoring centers is particularly important, he said, adding that some generate revenues that exceed those of international schools.

The plans to restructure the system and combine certain subjects together also alleviates pressures on both students and parents, Abeer Ahmed, founder of the Egyptian Mothers Union for the Advancement of Education, told Enterprise, emphasizing the importance of removing unnecessary subjects and content from the curriculum. However, she added, there has been a mixed reaction among parents regarding the decision to make some subjects pass/fail subjects so that they don’t impact the final grade.

The system was not preceded by an actual study, educational expert Magdy Hamza said, adding that this means that the decisions were made quickly and without sufficient consideration. Hamza called for a year-long adjustment to train teachers, finetune the curriculum, and prepare the learning environment.

Your top education stories for the week:

  • Rowan University to set up shop in new capital: New Jersey’s Rowan University is set to establish a branch in the New Administrative Capital following the signing of an MoU with the Modern Group University Foundation, which will host the branch.
  • Gov’t increases overtime compensation for teachers: The cabinet has raised the compensation for teachers who work beyond the legal teaching quota to EGP 50 per additional class. (Statement)
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CALENDAR

2024

AUGUST

August 2024: Shalateen to announce gold exploration tender winner.

SEPTEMBER

2-3 September (Monday-Tuesday): The Seamless North Africa conference, Cairo.

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

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

9-12 September (Monday-Thursday): The annual EFG Hermes London Conference.

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

16 September (Monday): Egypt-UK Investment and Opportunities Forum, London.

24 September (Tuesday): Enterprise Finance Forum, Cairo, Egypt

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

25-28 September (Wednesday-Saturday): Cityscape Egypt, Egypt International Exhibition Center, Cairo.

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

OCTOBER

1-3 October (Tuesday-Thursday): Cairo Sustainable Energy Week, Cairo, Egypt.

6 October (Sunday): Armed Forces Day.

10-12 October (Thursday-Saturday): Egy Health Expo, Egypt International Exhibition Center, Cairo.

10-12 October (Thursday-Saturday): The FinExpo Conference and Exhibition, Cairo.

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.

20-22 October (Sunday-Tuesday): Mediterranean Offshore Conference (MOC), Alexandria, Egypt.

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

NOVEMBER

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

12-15 November (Tuesday-Friday): Arab African Investment and International Cooperation Summit, Aswan, 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

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

3Q 2024: Egyptian-Armenian Joint Committee.

September 2024: Turkish-Egyptian Business Council meeting in Turkey.

September 2024: US-Egypt Strategic Dialogue, Cairo.

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.

2025

July 2025: The first operational trail of Egypt-KSA electricity interconnection line.

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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