EUR 1 bn tire factory + lots more investment news

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What We're Tracking Today

Egypt’s central bank expected to leave rates unchanged when it meets today

Good morning, wonderful people, and thank you — one and all — for an amazing week. It was a delight to see so many of you at our inaugural Enterprise Finance Forum on Monday and Tuesday.

It’s was also a great week for news, with tons of investment in the headlines from both Gulf investors and the domestic private sector. This morning builds on that theme: While our lead story is a package of state social support measures, we have news of an EUR 1 bn tire factory, funding from our friends at IFC for Damietta Port, and more. And on that topic:

INVESTMENT WATCH- “Egypt is very interesting” -Sagard: Canadian alternative asset manager Sagard could invest in financial services firms in Egypt, as well as the UAE, Saudi Arabia, and Turkey, the National quotes CEO and chair Paul Desmarais III as saying in an interview. The company, which is backed by Abu Dhabi sovereign wealth fund ADQ, is looking to double its assets under management to USD 30 bn in the next five years.

FROM THE RUMOR MILL- Is Saudi’s PIF eyeing three local private companies? Saudi Arabia’s sovereign wealth fund PIF is reportedly in advanced talks to acquire three private Egyptian companies that operate in the healthcare, education, and real estate sectors before the end of the year, Da ily News E gypt reports, citing unnamed sources it says are close to the transactions. The real estate developer in question is “one of the largest companies operating in Egypt”, the outlet quotes a source as saying.

WATCH THIS SPACE: We’ll have a timeline next week for the upcoming presidential election, the National Elections Authority said at a press conference yesterday. The NEA will announce the timeline on Monday. The question on everyone’s minds: Is there a scenario in which we can head to the polls in December?

PSA- Next week is a four-day week thanks to Prophet Mohammed’s birthday falling on a Wednesday. The Central Bank of Egypt conf irmed yesterday that the banking sector will be taking Thursday, 28 September off. This follows the cabinet's announcement last week that the public and private sectors will both be off.

We may also be in for a three-day weekend the following week in observance of Armed Forces Day, which falls on the Friday. The government typically declares a replacement day for national holidays that fall on Fridays.

HAPPENING TODAY-

#1- IT’S INTEREST RATE DAY- The Central Bank of Egypt (CBE) is expected to leave interest rates unchanged when it meets today, according to our customary poll of analysts. All seven of the people we spoketo think the CBE will leave rates on hold thanks to easing monthly inflation and the need t o retain policy space for a widely anticipated devaluation. A Reuters poll returned a similar forecast.

#2- The three-day Cityscape real estate expo continues at the Egypt International Exhibition Center today.

#3- It’s day 3 of the UN general debate: Among today’s speakers are Palestine, Sudan, Kuwait, Yemen, France, the EU and China. We’re still waiting on a slot for Egypt.

Techtember continues: Reviewers are out this week with their takes on the newly released iPhone 15, and the verdict is quite positive. At the high end of the scale, pundits are loving the new, lighter titanium build on the 15 Pro and the larger Pro Max models, the new programmable mute button, and very strong camera upgrades. The 15 and 15 Plus models get an upgraded processor, improved cameras, and Dynamic Island, but no mute switch or titanium. Both models have subtly updated contours. Oh, and both devices now feature USB-C ports.

Must-read reviews: As always, start with John Gruber’s Daring Fireball, then head over to the Verge, which has great takes on both the 15 / 15 Plus and Pro / Pro Max.

Want to watch instead? The Verge, once more (watch, runtime: 12:08) — and Marques Brownlee is in form (watch, runtime: 11:20). But if you’re a photographer, head straight to PetaPixel (watch, runtime: 22:02) for Chirs and Jordan’s take or head over to the Art of Photography (watch, runtime: 16:25), where Ted Forbes holds court.

When can we expect it here in Egypt? No time soon — not officially. While you can occasionally get some (lower storage capacity) iPhone 14 models on Amazon.eg, Apple authorized resellers including Tradeline have only the now two-year-old iPhone 13 models on their sites.

MEANWHILE- MICROSOFT has a special event today expected to focus on new Surface hardware and artificial intelligence . The tech giant will hold the event just days after hardware boss Panos Panay said he was leaving — apparently to Amazon. Watch the Microsoft event here (recorded) at 8pm CLT if you’re so inclined, or catch the live blog from The Verge starting at 5pm CLT.

Speaking of AMAZON- Jeff Bezos’ merry crew had their own hardware event yesterday and it cemented the retail (and cloud) giant’s status as an also-ran on the device front. The Verge has a rundown on all the announcements here.

NEXT UP after Microsoft is GOOGLE, which will formally launch on Wednesday, 4 October the (already kind-of-announced) Google Pixel 8 and 8 Pro along with a new watch.

WEEKEND READING- Learn how to be really, truly happy. Maybe it’s middle age or millennial angst (we have both happening here at Enterprise World HQ), but even the Gen Z crowd (in the form of the resident 16-year-old) is getting into The Atlantic’s happiness column by the inimitable Arthur C. Brooks. Start anywhere you please in the archive.

Need more pointed suggestions?

Want to hear more of Mr. Brooks? He’s appeared on (Egyptian-American-Canadian) longevity and performance guru Dr. Peter Attia’s podcast (watch, runtime: 1:47:36) and Tim Ferriss had him on last week (watch, runtime: 2:42:55)

HAPPENING NEXT WEEK-

AIIB meeting: Sharm El Sheikh will host the Asian Infrastructure Investment Bank’s annual board meeting on Monday and Tuesday, 25-26 September.

THE BIG STORY ABROAD-

The big story in the global business press: The Federal Reserve’s decision to leave interest rates unchanged, which we have more details on this morning’s Planet Finance, below. (Reuters | Bloomberg | Financial Times | Wall Street Journal | CNBC)

MBS + Netanyahu are talking up the prospects for Saudi-Israeli normalization: On the heels of a report that Saudi had exited talks with Israel to normalize ties, the leaders of the two countries yesterday gave public backing to the US-sponsored talks aimed at bringing Riyadh and Tel Aviv together. In an interview with Fox News (watch, runtime: 12:47), Saudi crown prince Mohamed bin Salman denied the report, saying that “every day, we get closer” towards normalization. Meanwhile, Israeli PM Benjamin Netanyahu said that the two countries will be able to “forge a historic peace” under US leadership. This came during talks with US President Joe Biden on the sidelines of the UN General Assembly yesterday.

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Egyptian cabinet approves social support measures, renewables expansion

An eventful cabinet meeting: Ministers yesterday greenlit a slew of decisions, including the recently-announced social support measures, a proposal to increase the capacity of Benban and establish a new wind farm, and new golden licenses for industrial projects, cabinet said in a statement following its weekly meeting.

#1- Fresh wage hike, tax cut + social support approved: Cabinet gave the go-ahead to the emergency social support measures announced by President Abdel Fattah El Sisi last week aimed at alleviating the impact of the economic crisis on vulnerable households. These included a minimum wage hike for public-sector workers, a higher one-off bonus payment for pensioners and the public sector, more generous pension payouts, and a wage tax cut.

A tax cut, you say? Don’t get too excited, it’s a modest one: The basic personal exemption for wage taxes will rise to EGP 45k from EGP 36k today. That’s a break for employers who offer net salaries — and for employees at firms that offer gross salaries.

The measures will all go into effect starting from 1 October 2023 with the exception of the tax cut, which requires amendments to the tax code that will need to be voted on in the House of Representatives when it is back in session next month.

Remember: Inflation accelerated at a record pace in August on the back of ballooning food prices. The urban rate of inflation rose to 37.4% y-o-y from 36.5% the month before, thanks largely to food and beverage prices soaring 71.4% y-o-y.

#2- A 50% expansion at Benban + a new wind farm: Ministers approved an offer submitted by UAE-based AMEA Power to expand the production capacity of the 1.8-GW Benban solar park in Aswan by 1 GW, and to set up a 500-MW wind farm in Ras Ghareb. Enterprise Climate is looking into the project and will report back next week.At an investment cost of about USD 1 bn (or thereabouts) per GW of solar power, this is a big announcement.

#3- Golden licenses for…

Gasco: Ministers approved handing the Egyptian Natural Gas Company (GASCO) a golden license for its USD 380 mn project to expand its gas complex in Alexandria. The company wants to add a fourth production line with a capacity of 600 mn cubic feet a day.

EgyptSat Auto: Another golden license was granted for EgyptSat Auto’s planned EGP 300 mn electric mobility and components factory in the Tenth of Ramadan industrial zone. EgyptSat Auto is a local private sector company that produces electric golf carts.

#4- Oil exploration: The cabinet also gave the green light to the oil minister to contract with Russian oil company Lukoil to comb areas in the Western Desert for oil and gas.

Egypt to build EUR 1 bn tire factory

Tire money rolls in: Rolling Plus Chemical Industries has signed a contract to establish a EUR 1 bn (c USD 1.1 bn) tire factory in the Ain Sokhna industrial zone, cabinet said in a statem ent yesterday. The plant could create as many as 1k direct and indirect jobs.

In detail: The 400k-meter factory will produce some 7 mn tires each year. The first phase, worth EUR 400-450 mn, includes the construction of the factory and production lines to produce 2.5 mn passenger car tires annually, with 50% of the output directed to the local market. The second phase of the project will add production lines to produce 3.5 mn light vehicle tires per year, 40% of which will be sold locally. Production lines for heavy transport vehicle tires will be added in the final phase. The statement did not provide a timeline for the project’s implementation.

What’s Rolling Plus? The company’s shareholders include Egyptian, Saudi, and Cypriot companies, Reuters reports. Its CEO is John Barakat, according to the cabinet statement. The company has no online footprint that we could find.

Concrete Plus? Most of the specs of this factory match the one announced by Concrete Plus earlier this year, down to the size, location, the phase one investment amount, and most of the capacity figures. We were unable to confirm whether this is a separate project or whether Rolling Plus is the name of the recently-announced Concrete-Saudi JV.

Also involved: Finnish tire consulting firm Black Donuts will act as a technical consultant on the project, the statement reads.

Remember: The Madbouly government’s automotive strategy aims to develop the local car industry in order for Egypt to become a regional manufacturing hub.

Read more about our fledgling domestic tire industry — and the challenges it’s facing — in our recent Inside Industry two-parter (Part I | Part II).

IFC could lend USD 125 mn for Damietta Port cargo terminal

We now know how much funding the IFC could extend to Damietta cargo terminal II: Our friends at the International Finance Corporation (IFC) are considering extending USD 125 mn loan to Egypt to fund the construction of Damietta Port’s second container terminal, according to the lender’s website. The board is expected to make a final decision on the facility on 30 October.

Remember: The funding is part of a USD 455 mn financing package involving the IFC, the European Bank for Reconstruction and Development (EBRD), the Asian Infrastructure Investment Bank (AIIB), Deutsche Investitions und Entwicklungsgesellschaft (DEG), and the French Development Agency’s private-sector investment arm Proparco. The AIIB is chipping in USD 100 mn, and EBRD announced funding the project with USD 125 mn last month.

Background: A consortium of European companies are working on the project: Hapag-Lloyd, Eurogate Terminals, and Contship Italia signed an agreement with the Damietta Port Authority last year for the USD 665 mn project. The firms will establish the terminal under a 30-year build-operate-transfer framework. The terminal will have a final capacity of 3.3 mn TEUs and is expected to begin operating by 2024, raising the port’s total capacity to 4.7 mn TEU by the third year of its operation.

Egypt-based Pickalbatros Hotels to invest USD 140 mn in Morocco within 2 years

Pickalbatros targets Morocco expansion: Egypt-based hotel owner and operator Pickalbatros Hotels & Resorts Group will invest USD 140 mn in Morocco over the next two years, Asharq Business reports, quoting company CEO and chair Kamel Abou Aly. The company wants to raise its hotel capacity by 43% to 2k rooms, and is eyeing expansion in Agadir in particular, he said.

ICYMI- Pickalbatros is expanding here, too: The company’s new 200-room, EGP 400 mnLaguna Club Hotel in Sharm El Sheikh is due to open in November, while the 840-room Portofino Marsa Alam should also open its doors within the next few months, Abou Aly said last month. The company has also said it will use part of the proceeds from the recent EGP 750 mn sale and leaseback of its Laguna Vista Beach Resort in Sharm El Sheikh to Beltone to fund expansion.

About Pickalbatros: The company runs some 25 hote ls with more than 14k rooms in total here, and three hotels with 1.4k rooms in Morocco.

Remember: Another industry veteran is making a big play in Morocco. Samih Sawiris is reportedly partnering with local and Emirati players to invest as much as MAD 4 bn(USD 390 mn) to redevelop the Mogador resort in Essaouira. Like Egypt, the country is experiencing a boom in tourism as the sector bounces back from the pandemic.

Shell sells minority stake in offshore block to Kuwait’s Kufpec

Kufpec gets a slice of Shell’s Mediterranean block: Kuwait Foreign Petroleum Exploration Company (Kufpec) will acquire a 40% stake in Shell’s North East El Amriya concession area — also known as Block 3 – in the Mediterranean Sea, the companies said in a joint statement on Wednesday. The farm out agreement is pending approval from the government and regulators, the company said. It did not disclose the value of the stake.

No changes on the ground: Shell, via its BG International subsidiary, will remain the operator of the block. The company has owned and operated the concession since it acquired it in full from ExxonMobil last year.

SOUND SMART- A farm out agreement is when a company which owns the right to explore (or produce) oil or gas lets another party do the actual work. Company A might have the right to explore gas, but not the money or interest in doing so. Under a farm out agreement, Company A assigns its rights to Company B in exchange for an up-front payment, plus a royalty, cut of sales or percentage of earnings. Company B would also have to meet specific targets or spending requirements. Farm out agreements are common in the oil, gas and mining industries.

What they said: “We are glad to expand our presence in Egypt in cooperation with our international operating partners in highly prolific exploration basins… This new partnership in Block 3 empowers Kufpec to boost its offshore assets and exploration activities in Egypt,” company CEO Mohammad Salem Al Haimer said in the statement.

Kufpec is already active in the region: Kufpec holds a 40% working interest in the Geisum and Tawila West concession in the Gulf of Suez, where majority owner Cheiron made a new discovery last month. The Kuwaiti company also gained a 25% participating interest in the North Ras Kanayes offshore block in the Mediterranean in 2020.

Drilling has begun: Shell and its partners began drilling three new gas exploration wells at Amriya and the adjacent North Sidi Gaber concession last month, according to the Kufpec statement. Shell is spending more than USD 200 mn to pump another 200 mn cubic feet of gas per day from three new wells at its offshore West Delta Deep Marine (WDDM) development lease, it said in July.

Egypt to launch tender for Cairo-Alex freight rail bypass in 1Q 2024

The race for the contract to build the Cairo-Alex freight rail link starts soon: The Transport Ministry is gearing up to launch a tender for the planned Cairo-Alex andria freight railway bypass in 1Q 2024, a ministry source told Enterprise, confirming a report by A l M al. So far, some 11 consortiums of both Egyptian and global companies have qualified for the tender, the source said.

The timeline: The ministry will announce the qualified firms later this year and award the contract in April, sources reportedly told Al Mal. Our source could not confirm the timeline for the awarding of the contract.

Interested candidates: Initially, Petrojet, Arab Contractors, Hassan Allam, Concord, and Orascom Construction all expressed their interest in the USD 740 mn project. However, the Egyptian National Railways opted for a public qualification tender, followed by a tender that’s exclusive to the qualified bidders, Al Mal reported. We were unable to reach representatives of the companies to confirm their interest.

World Bank backing: The World Bank already approved a USD 400 mn loan for the project back in 2022. The remaining costs are expected to be covered through local sources, although the precise amount is still subject to adjustments, according to our source.

Refresher: The bypass will allow freight trains to travel to and from the Port of Alexandria and the newly-constructed Sixth of October dry port via an alternative western route of Greater Cairo that avoids the congested Greater Cairo-Sixth of October rail corridor. The bypass will be able to handle 15 container trains per day by 2030 and up to 50 trains by 2060.The project is supposed to boost the transport and logistics sector as well as help the country move towards a low-carbon railway system.

Hisham Badr appointed assistant planning minister

Hala El Said names Hisham Badr assistant minister: Planning Minister Hala El Said has appointed former ambassador Hisham Badr as the new assistant minister for strategic partnerships, the ministry said in a statement yesterday. Badr is one of Egypt’s top diplomats, having served as the ambassador to Italy and Japan, and an assistant foreign minister. He also chaired the executive committee of the UN’s refugee agency and headed the balance of payments restrictions committee at the World Trade Organization.

The National Elections Authority press conference and SCZone action get airtime

It was a slow night for business news on the talk shows last night, with yesterday’s press conference by the National Elections Authority taking up the bulk of the airtime. Al Hayah Al Youm’s Mohamed Sherdy was especially eager to pore over each and every detail, dedicating the entirety of his 80-minute show to the subject. Masaa DMC (watch, runtime: 3:49) and Ala Masouleety (watch, runtime: 4:14) also had coverage.

Is the India-Middle East trade route a threat to the canal? “Meh,” said Transport Minister Kamal El Wazir, expressing confidence to Ala Masouleety show host Ahmed Moussa that “nothing will be an alternative to the Suez Canal” (watch, runtime: 4:31).

Remember: The US is backing a major new trade route linking South Asia, the Middle East and Europe. New ports and railways will ship goods between India and Europe via Saudi Arabia, the UAE and Israel under an MoU signed at the recent G20 summit.

Also on the airwaves: Masaa DMC’s Eman El Hosary discussed the new USD 1 bn tire factory being set up in the Suez Canal Economic Zone (SCZone), and SCZone head Walid Gamal El Din’s trip to Amsterdam (watch runtime: 7:20 | 1:15). We have more on both these stories in this morning’s news well and Also on our Radar.

Ancient Egyptian treasures are headed to Australia

It’s a mixed bag in the foreign press this morning: The Guardian reports that Melbourne’s National Gallery of Victoria will borrow over 500 ancient Egyptian artifacts from the British Museum’s permanent collection for a landmark exhibition opening next June. The international loan is the largest ever by the London museum, and comes amid controversy over its refusal to return artifacts to their countries of origin.

ALSO- Voy, Voy, Voy goes for Oscars glory : Egypt has selected the comedy from director Omar Hilal as its candidate for best international feature film at the 2024 Academy Awards. (Deadline)

Infinity to charge BMW EVs in Egypt. PLUS: Africa tariff cuts ratified, onion export ban, another wheat buy, and a West Cairo BRT could be in the making.

AUTOMOTIVE-

Infinity to charge BMW EVs: Global Auto Group, BMW’s agent and importer in Egypt, signed a strategic partnership agreement with our friends at Infinity to charge electric BMWs at its charging stations, the companies said in a joint statement (pdf) yesterday.

Remember: Infinity is planning to increase the number of charging stations to 300 and charging points to 1k by next year. This is part of a plan with the government to set up 3k stations across the country.

TRADE-

#1- El Sisi signs off on customs breaks for intra-African trade: A presidential decree ratifying the bill for Egypt’s membership in the African Continental Freetrade Area(AfCFTA) agreement was published in the Official Gazette last week, bringing the customs breaks under the agreement into effect. The House of Representatives in June a pproved a bill ratifying the customs reductions under AfCFTA.

FYI- Countries that have ratified the trade agreement have committed to eliminating tariffs on 90% of tariff lines over five years (10 years for low-income countries).

#2- A three-month onion export ban: Ministers yesterday approved halting onion exports until the end of the year in a bid to curb soaring prices, the cabinet said in a statement. The price per kilo has surged to EGP 35 in recent days, part of a wave of record-high inflation triggered by several currency devaluations and a prolonged shortage of FX. Food prices accelerated at a record rate of 71.4% y-o-y in August.

TRANSPORT-

West Cairo BRT? The Institute for Transportation and Development Policy has signed a consultancy agreement with the New Urban Communities Authority to advise on implementing a bus rapid transit (BRT) system between Sixth of October City and parts of Giza governorate, the Housing Ministry said Tuesday. The International Swedish Fund awarded the USD 450k grant for the consulting service on the transportation project, according to Ahram Online.

FYI- The Ring Road BRT system, which broke ground last year, is aimed at reducing traffic on the congested freeway.

COMMODITIES–

#1- More Romanian wheat: GASC has purchased 120k tons of Romanian wheat in a tender, Reuters reports. The state grains buyer agreed to pay USD 272 per ton on a cost and freight basis, according to the newswire.

#2- GASC’s big Russian wheat buy will now come from France + Bulgaria: The 480k-ton shipment of wheat that state grain buyer GASC agreed to buy from a Russian commodity trader will be sourced from Bulgaria and France, Bloomberg reports, citing people it says are in the know. The Supply Ministry earlier this month tweaked its purchase agreement with trader Solaris, allowing it to source the grain — which had initially been set to come from Russian sources — from any origin.

Russia’s wheat price floor appears to be the obstacle: Moscow reportedly objected to the price Solaris offered for the Russian grain — USD 270 per ton including freight — because it was lower than an unofficial price floor that the Russian government is currently enforcing. While the wheat floor is not legally binding and there’s been a lack of consensus about where exactly it stands from month to month, traders are expected to adhere to it.

M&A WATCH-

B Investments needs more time to acquire OFH: The Financial Regulatory Authority (FRA) has approved a request by EGX-listed private equity firm B Investments to extend the deadline for submitting its mandatory tender offer (MTO) to acquire up to 90% of Orascom Financial Holding, it said in a statement (pdf) to the bourse yesterday. The regulator has extended the deadline by 60 working days, giving it until the middle of December to file the MTO.

Remember: B Investments approved in June plans to submit an MTO to acquire up to 90% of Orascom Financial Holding via a share swap agreement. OFH’s majority shareholder OTMT Acquisition and minority shareholder Orascom TMT Investments have agreed to sell their combined 51.72% stake in the company.

LOGISTICS-

SCZone talks green fuel, LNG bunkering in Amsterdam: The Suez Canal Economic Zone (SCZone) head Walid Gamal El Din was in Amsterdam over the week for talks with global maritime and port green energy industry leaders on Egypt’s green hydrogen projects, according to a SCZone statement. He talked with Shell executives about introducing LNG and green methanol bunkering in Egypt, and held discussions with Danish shipping giant Maersk about its work to expand the East Port Said port.

Remember:

Maersk’s Suez Canal Container Terminal is leading the USD 500 mn expansion of East Port Said port. The company is constructing a second container terminal that is expected to raise the port’s capacity by 40%.
The shipping giant is also planning on making the Suez Canal one of its hubs for producing green methanol. It recently established a new company that will be in charge of manufacturing the chemical, and is thought to be in pole position to acquire half of the Zafarana wind farm to power its facilities.
Shell was among a number of companies that signed a letter of intent with EGAS last year to explore LNG bunkering in Egypt.

Czech firms interested in green hydrogen: A Czech delegation led by the Czech ambassador to Egypt met with Gamal yesterday to talk about cooperation over green hydrogen projects, among other industry and service sectors, the SCZone said separately.

REAL ESTATE-

#1- Al Ahly Sabbour has its eye on KSA: Real estate developer Al Ahly Sabbour is at the final stages in setting up a presence in Saudi Arabia, Al Ahly Sabbour Chairman and Managing DirectorAhmed Sabbour told Asharq Business. He added that the developer inked a cooperation agreement with Saudi’s National Housing Services Company to set up a real estate project in Riyadh, the details of which were not disclosed.

#2- GAFI + FRA to amend real estate fund law: The General Authority for Investment and Freezones (GAFI) and the Financial Regulatory Authority are reportedly mulling changes to real estate fund law, aimed at encouraging the launch of more real estate funds, write Al Borsa.

EDUCATION-

CIRA Education hits record for net annual student enrolment: CIRA Education saw a net increase in enrolment numbers of around 5k students across its facilities for the 2023-2024 academic year — 25% more than its previous annual record, the company said in its latest admissions report (pdf). The education provider admitted some 11k new students in total across its two universities and 27 schools. Of the new intake, some 3.5k students came from the higher education segment, while the remaining 1.5k came from the K-12 segment, the report said.

Al Ahly Sabbour ALSO ON OUR RADAR automotive BMW bunkering CIRA Education commodities customs Education energy Financial Regulatory Authority GAFI GASC Global Auto Group green methanol hospitality Infinity M&A Watch Maersk New Urban Communities Authority oil and gas real estate Sagard Shell Suez Canal Economic Zone tourism trade transport wheat

12

PLANET FINANCE

Federal Reserve signals higher rates for longer

US interest rates will be higher for longer: The US Federal Reserve decided to leave interest rates unchanged but signaled that policy will remain tight for longer amid the continuing strength of the economy, it announced following its two-day policy meeting yesterday. Most Fed officials expect to need to lift its benchmark rate by another 25 bps to 5.5%-5.75% this year, though Fed chair Jerome Powell made sure to emphasize that the central bank will “proceed carefully” with any further hikes. The meeting came on the heels of August data that showed inflation picking up again, raising expectations in some quarters that rates may need to move higher than currently though, especially in light of the recent surge in oil prices.

The markets weren’t happy: US stocks fell sharply following the post-meeting presser, with the Nasdaq losing 1.5% and the S&P down almost 1.0%. Asian markets are also in the red this morning, while equity futures in the US and Europe are signaling further losses today.

The Bank of England is up next: The UK’s headline inflation rate unexpectedly fell in August, dropping 0.1 percentage points to 6.7% and causing the GBP to fall to its lowest rate against the USD since May. The data has raised expectations that the Bank of England could keep rates on hold when it meets today. (Reuters | Financial Times)

EGX30	19,797	-0.8% (YTD: +35.6%)
USD (CBE)	Buy 30.83	Sell 30.96
USD at CIB	Buy 30.85	Sell 30.95
Interest rates CBE	19.25% deposit	20.25% lending
Tadawul	11,062	-0.1% (YTD: +5.6%)
ADX	9,823	0.0% (YTD: -3.8%)
DFM	4,138	+1.6% (YTD: +24.1%)
S&P 500	4,402	-0.9% (YTD: +14.7%)
FTSE 100	7,732	+0.9% (YTD: +3.8%)
Euro Stoxx 50	4,276	+0.8% (YTD: +12.7%)
Brent crude	USD 93.18	-1.2%
Natural gas (Nymex)	USD 2.74	-3.9%
Gold	USD 1,951.20	-0.1%
BTC	USD 27,077	-0.4% (YTD: +63.4%)

THE CLOSING BELL-

The EGX30 fell 0.8% at yesterday’s close on turnover of EGP 2.9 bn (35.5% above the 90-day average). Local investors were net sellers. The index is up 35.6% YTD.

In the green: Alexandria Containers and Cargo Handling (+6.9%), Sidi Kerir Petrochemicals (+6.6%) and Alexandria Mineral Oils Company (+5.1%).

In the red: Mopco (-5.1%), GB Corp (-4.8%) and Qalaa Holdings (-4.7%).

Egypt, Iran top diplomats hold talks at UN

Shoukry holds talks with Iran FM amid normalization speculation: The top diplomats from Egypt and Iran held face-to-face talks on the sidelines of the UN General Assembly yesterday amid growing speculation that the two countries will move to normalize diplomatic ties. Foreign Minister Sameh Shoukry discussed with his Iranian counterpart Hossein Amir Abdollahian developing bilateral ties as well as a number of regional issues, according to a Foreign Ministry readout of the conversation.

Remember: Iran has launched a diplomatic offensive in the Arab world this year, signing a landmark accord with its former arch enemy Saudi Arabia to reopen embassies, holding high-level talks with the president of the UAE, and reportedly engaging in months of talks with Egypt to normalize relations. Supreme Leader Ayatollah Khamenei has personally given his blessing to the government to pursue warmer ties with Cairo.

ALSO- Shoukry discussed immigration with the Italian foreign minister, terrorism with his Pakistani counterpart, and the Sudan conflict with Uganda’s foreign minister. He also held talks with the foreign ministers of Canada, Norway, New Zealand, Croatia and Sierra Leone.

AND- Shoukry sat down for an interview with Turkish state broadcaster TRT World in New York (watch, runtime: 21:00), another sign of warming relations between the two countries a few months after they agreed to normalize ties.

My Morning Routine: Omar Rezk, managing director of Entlaq

Omar Rezk, managing director of Entlaq Holding: Each week, My Morning Routine looks at how a successful member of the community starts their day — and then throws in a couple of random business questions just for fun. Speaking to us this week is Omar Rezk (LinkedIn), managing director of Entl aq Holdi ng.

My name is Omar Rezk and I am the managing director for consulting and strategy at Entlaq Holding, which is a Cairo-based accelerator and consulting firm. I graduated from AUC with my degree in political science in 2018. Before Entlaq, I worked in investment banking, then political consulting, and then finally for Uber, handling Uber Bus operations in the Middle East and Africa.

At Entlaq, we’re split into two business units. The first is an accelerator focused on Egyptian startups from early to pre-seed stage. We do it twice a year and we invest up to USD 50k per startup at the end of the program, which usually lasts between four and six months. Then there is the consulting and strategy unit, where we work with all the stakeholders in the ecosystem — development partners, university level programs, government stakeholders, startups, and the private sector.

We work with startups on several areas, including advising them on policies — how to approach and assess them — using our policy framework. We also handle startups’ partnerships with the government, be it through regulation or government programs that empower the private sector and entrepreneurship.

We also offer B2G services, working with the government through our capacity as a member of the technical entrepreneurship committee, which reports directly to the Madbouly cabinet. The committee includes members from the ministries of finance and planning, the Information Technology Industry Development Agency (ITIDA), the General Authority for Investment and Freezones (GAFI), the Financial Regulatory Authority (FRA), and the Central Bank of Egypt.

We see a number of obstacles hindering the entrepreneurial ecosystem. First of all, it’s mainly focused on Cairo. There also aren’t enough women founders and there’s a lack of access to financial resources and support. The key component is outreach. We need education, financial, and policy channels.

Our vision for 2024 is all about expansion. We want to expand access to entrepreneurial tools to every governorate. We’ll boost our geographical reach with our entrepreneurship and universities program that will kick off in 2024. I’m optimistic about where it may go.

We also want to increase data availability. Getting local economic, market, and socioeconomic data is not the easiest job but it would be a great investment catalyst.

The VC curve has started to flatten a bit, but at the same time local startups have shown resilience. Even amid the ongoing economic situation, we still see a lot of Egyptian startups standing strong. It’s not about exponential growth but about consistent growth.

People have been more focused recently on industrial tech and agritech. They’re starting to look at the biggest sectors present in the market and innovating there. Entrepreneurs have also shifted their focus from global issues to local issues.

I wake up around 8 am. I pick up my phone, check Twitter and my calendar to see what I have planned for the day, and then I read EnterpriseAM. I started reading Enterprise in 2017 when I was working at a local consulting firm and basically haven’t missed an issue since.

If I’m up early, I’ll try to sneak in a walk before I head to our office in Downtown. My team and I hold morning meetings in the garden. A big part of our job is being on top of the news — the economic situation, investments, and regulation — in order to be able to forecast where things may go.

Then I usually have lots of calls to make and meetings to attend. I try to free up a day or two without calls and meetings to focus and reflect on our strategy. At the end of the day, I take a look at our tools and trackers in order to see where we stand in terms of our current objectives.

I usually end the day at around 6 or 7 pm. At Entlaq, we try to keep a great work-life balance in order to maintain our productivity. We try to get the most out of our working hours.

After my workday is done, I head to the gym for a workout, then I’ll meet a few friends or head back home to have dinner with my family. I try to spend my commute from my house in New Cairo to the office in Downtown checking in with family and friends.

Succession is one of the best shows I’ve ever seen. It gave me a look into a whole new world of corporate politics and family dynamics.

CALENDAR

SEPTEMBER

19-26 September (Tuesday-Tuesday): UN General Assembly, New York.

20-23 September (Wednesday-Saturday): Cityscape Egypt, Egypt International Exhibition Center, Cairo.

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

23-29 September (Saturday-Friday): Engineering Export Council of Egypt Iraqi trade mission.

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.

25-26 September (Monday-Tuesday): Egypt to host the Asian Infrastructure Investment Bank’s annual board meeting, Sharm El Sheikh.

27 September (Wednesday): Prophet Muhammad’s birthday.

26 September (Tuesday): Taqa Arabia’s ordinary general assembly meeting.

27 September (Wednesday): Deadline for bidding in the fifth phase of the investment map offered by the Industrial Development Authority (IDA).

27 September (Wednesday): Deadline for bidding in tender for five solar plants on north coast.

28 September (Thursday): Eastern Company will hold an ordinary general assembly meeting to approve the company’s financials for the 2022-2023 FY.

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

28-29 September (Thursday-Friday): Medical Tourism Conference, Sharm El Sheikh.

30 September (Saturday): The start of the new academic year for Egyptian universities.

30 September (Saturday): The start of the new academic year for Egyptian schools.

Signposted to happen sometime in September:

Sustainable Debt Coalition Initiative agreed at COP27 to launch
IDH to open first branch in Saudi Arabia
The Egypt-Germany trade and investment joint conference in Cairo
ADQ to acquire stakes in Elab, Ethydco and EDC by end of month

OCTOBER

1 October (Sunday): Public-sector minimum wage hike, other financial support measures come into effect.

1-3 October (Sunday-Tuesday) International Expotec for water economics management, Egypt International Exhibition Center, Fifth Settlement, Cairo.

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

2 October (Monday): Government meeting with investors to look into liberalizing electricity grid.

6 October (Friday): Armed Forces Day.

7 October (Saturday): HHD shareholders to consider NOSI’s offer to acquire Heliopark land.

9 October (Monday): The Narrative PR Summit, Somabay Red Sea.

9-11 October (Monday-Wednesday): Arabs Savings and Financial Literacy Conference, Four Seasons Hotel.

10-12 October ( Tuesday-Thursday) Ceramica Expo, Cairo International Convention Center.

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

Late October-14 November: 3Q2023 earnings season.

15-17 October (Sunday-Tuesday): Egypt Automotive Aftermarket Exhibition, Cairo International Convention Center.

26 October (Thursday): Daylight saving time ends.

29-31 October (Sunday-Tuesday): Egypt Energy, Egypt International Exhibition Center.

29 October - 2 November (Sunday- Thursday): Cairo Water Week.

30-31 October (Monday-Tuesday): Intelligent Cities Exhibition and Conference, Dusit Thani LakeView, Cairo.

30-31 October (Monday-Tuesday): Global Business School Network (GBSN), American University of Cairo.

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

Signposted to happen some time in October:

Deadline for ins. providers to link their databases with the FRA
Egyptian-Jordanian Business Council, Amman, Jordan
Gov’t expects to finalize sale of Gabal El Zeit wind plant
October or November: Gov’t expects to finalize stake sale for military-owned fuel retailer Wataniya

NOVEMBER

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

8 November (Wednesday): Turkish-Arab Economic Forum 2023, Istanbul.

9-15 November (Thursday-Wednesday): Intra-African Trade Fair, Cairo.

14-15 November (Tuesday-Wednesday): Destination Africa, Royal Maxim Palace Kempinski Hotel.

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

19-22 November (Sunday-Wednesday): Cairo ICT, Egypt International Exhibition Center.

22 November (Wednesday): Deadline to apply to FRA for credit rating license.

23 November (Thursday): Worldview Education Fair, Cairo. (Register here)

30 November-12 December (Thursday-Tuesday): COP28, Dubai.

DECEMBER

9-15 December (Saturday-Friday) :The Engineering Export Council of Egypt’strade mission to Saudi Arabia.

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

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

12-14 December (Tuesday-Thursday): Food Africa Expo, Egypt International Exhibition Center.

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

Signposted to happen sometime in December:

Gov’t expects to finalize sale of a stake in military-owned bottled drinks company Safi
Gov’t expects to finalize sale of Zafarana wind farm

EVENTS WITH NO SET DATE

2023: The inauguration of the Grand Egyptian Museum.

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.

3Q 2023: E-Finance to launch in Saudi Arabia.

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

4Q 2023: EGX to launch a shariah-compliant index.

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

2024: Standard Chartered Bank to open a branch in Egypt.

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.

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

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

2Q 2025: Safaga Terminal 2 to start operations.

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