Float reignites investor confidence in Egypt

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What We're Tracking Today

February’s inflation figures out today

Good morning, friends. Enjoy your last cup of coffee and breakfast sandwich for some time as we gear up to welcome the first day of Ramadan tomorrow — well either tomorrow or Tuesday, we’ll know for certain tonight following the crescent moon sighting indicating the beginning of the holy month.

So, when do we eat? Maghrib prayers are at 6:02 pm tomorrow in the capital, and you’ll have until 4:49 am on Tuesday to hydrate and caffeinate ahead of fajr.

PSA #1- Ramadan hours start today: Shops, malls, restaurants, and cafes will be allowed to stay open until 2 am during the month of Ramadan and the Eid Al Fitr holiday. Public sector employees will be at their desks from 9am to 2pm and banks will now be open for customers between 9:30am and 1:30pm (9am to 2pm for staff) through Ramadan.

PSA #2- The silly season of time changes has begun. Clocks spring forward one hour today in New York, Toronto, and much of North America. The UK follows suit on 31 March, while Egypt will advance one hour on 26 April.

WATCH THIS SPACE-

#1- IMF money incoming: The first tranche of the IMF’s expanded USD 8 bn loan program could land in state coffers before the end of the month, Central Bank of Egypt Governor Hassan Abdalla told Al Mal on Thursday, without disclosing the value of the tranche.

#2- The next Ras El Hekma? Egyptian authorities have been in talks with Saudi officials regarding the development rights for Sharm El Sheikh’s Ras Gamila, people with knowledge of the matter told Bloomberg. The negotiations are at “early stages and could fall through”, Bloomberg’s sources said. The Ras Gamila plot is “far smaller” than Ras El Hekma but will still bring in USD bns, Bloomberg said.

Don’t celebrate yet: Rumors regarding the development plans for the Red Sea area spread days after Egypt released the news of its USD 35 bn Ras El Hekma agreement with the Abu Dhabi wealth fund and they were quickly shut down by government officials.

#3- Fresh amendments to the income tax law?The Finance Ministry will issue a draft of changes to the Income Tax draft law for public consultations, Finance Minister Mohamed Maait said on Thursday (watch, runtime: 1:16:06). The House last month approved amendments to the Income Tax Act that raise the income tax exemption threshold to EGP 60k from EGP 45k.

HAPPENING TODAY-

#1- It’s inflation day: Capmas and the central bank will release inflation data for February today. Annual urban inflation dropped to 29.8% in January — its lowest level in a year and fourth consecutive monthly drop.

A fifth consecutive drop? A Reuters poll of 14 analysts see annual urban inflation falling to 25.1%, driven primarily by a favorable base effect.

Don’t expect it to last: We expect the Madbouly government to push ahead with a round of subsidy cuts that will include an increase in the price of fuel.

The impact should be muted and hit food inflation more than most other categories. The float of the EGP last week should, in and of itself, be reasonably good for inflation — goods in store prior to the float had been priced at an effective exchange rate of around EGP 70 to the greenback.

The smart money sees us on a disinflationary path later this year, a development that should provide the central bank room to start trimming interest rates in the second half of the year.

#2- Seventh phase of export subsidy program kicks off: The Finance Ministry has launched the seventh phase of its export subsidy program, through which it plans to pay out some EGP 8 bn worth of overdue subsidies to exporters, according to a ministry readout. Exporters have between today and 9 May to send in their requests. Exporters will receive their payments over two phases — 27 June and 8 August.

CIRCLE YOUR CALENDAR-

European officials coming to Cairo: A number of European officials including European Commission President Ursula von der Leyen and the Greek, Belgian, and Italian prime ministers are landing in Cairo next Sunday, 17 March. During her time in Egypt, the EU Commission chief will meet with President Abdel Fattah El Sisi, European Commission spokesperson Veerle Nuyts said without providing any further details.

On the agenda: We have an idea what the visit may entail — last week Prime Minister Moustafa Madbouly said that the expanded USD 8 bn package from the IMF will be followed by more funding from other international partners like the World Bank and EU. “The mission is taking place in the context of talks for a stronger partnership between the EU and Egypt,” the statement said.

IN THE HOUSE-

New Unified Budget Act up for a final vote: MPs are meeting today to discuss and give their final seal of approval on the amendments to the United Budget Act — they gave the amendments their preliminary approval yesterday. Under the amendments, the budgets of all 59 of the state’s economic bodies and the state budget will be presented in a new consolidated budget — dubbed the Public Government Budget.

A little help from an old friend: The amendments were drafted after consulting international institutions including the IMF, Finance Minister Mohamed Maaid said.

** Maait last month unveiled the ins and outs of the amendments — read our coverage here.

WAR WATCH-

Another round of ceasefire talks will resume in Cairo today, Egyptian security sources told Reuters. This round follows unsuccessful talks last week, where Hamas refused to agree to a ceasefire in exchange for the release of Israeli hostages, saying that the agreement lacks substantial measures to end the war altogether. A Hamas delegation is unlikely to travel to Cairo for the new round of negotiations, a source from the group told Reuters.

Israel remains engaged in the talks: CIA head William Burns and Mossad chief David Barnea on Friday discussed a hostage release agreement. “Contacts and cooperation with the mediators continue all the time in an effort to narrow the gaps and reach agreements,” the Israeli Prime Minister Office said in a post on X.

EU sets up aid corridor to Gaza as we approach Ramadan: A maritime aid corridor between Cyprus and Gaza is expected to launch today in a joint effort between the EU, US, and UAE to deliver food and medical supplies to the besieged enclave, according to a statement (pdf). This came a day after US President Joe Biden said the US would build a temporary port on Gaza’s Mediterranean coast to speed aid deliveries.

AND- Foreign Minister Sameh Shoukry discussed ceasefire progress on a call with US Secretary of State Antony Blinken, according to a statement from the ministry on Friday. Shoukry also warned Blinken about the “catastrophic humanitarian consequences” if Israel goes ahead with its planned ground incursion into Rafah.

RED SEA WATCH-

Houthis launch flurry of drone attacks on Red Sea vessels: Yemen’s Houthis launched 37 drones targeting US warships in the Red Sea and Gulf of Aden on Saturday, the group’s spokesperson Yahya Saree posted on X yesterday. Later in the day, US Centcom announced that it had downed 28 Houthi drones.

THE BIG STORY ABROAD-

No single story dominates headlines this morning, but among those you should know about:

Talks on a ceasefire in Gaza are set to resume in Cairo today, though it seems unlikely Hamas will be physically in the Egyptian capital for the discussions.
Sam Altman is back on the board of OpenAI and the Wall Street Journal has thoughts about which flavor of AI might be best for your business.
Ransomware gangs LockBit and and BlackCat are implodingafter law enforcement mounted a coordinated campaign to take them down. LockBit made headlines in our part of the world with a high-profile attack on Egyptian fintech giant Fawry.

MORNING MUST-READS- Pundits spent much of 2022 and 2023 warning about economic armageddon — it didn’t arrive — but that doesn’t mean we’re not looking at a meltdown in (US) capital markets. That’s the takeaway from twin pieces getting plenty of attention this morning.

Start with:Jamie Dimon and Ray Dalio warned of an economic disaster that never came. What now? in the Wall Street Journal.

Then read:Markets are hitting record highs. And economists like El-Erian and Krugman can’t shake off their fears, which digs into both potential catalysts for a market plunge — and why some think the US (and perhaps global) economy isn’t out of the woods just yet.

CORRECTION- In Thursday’s issue of EnterpriseAM Egypt, we mistakenly quoted HC Securities writing in a note that “the banking sector is among the biggest beneficiaries of the exchange rate increase.” HC Securities instead wrote that “the banking sector is among the biggest beneficiaries of the rate hike.”We have amended the story on our website.

Egypt could be in for USD 20 bn in foreign support. PLUS: Good news from Morgan Stanley

IMF agreement could pave the way for more foreign financing: Officials expect our agreement with the IMF to help secure a total of USD 20 bn in foreign support, Finance Minister Mohamed Maait said on Thursday during AmCham’s monthly luncheon — under the title Egypt at the Crossroads: Fiscal Policy for Economic Revival — attended by Enterprise.

The breakdown: The USD 20 bn figure includes the USD 8 bn IMF package we agreed on with the Fund last week and a still-in-talks USD 1-1.2 bn in climate finance under the Fund’s Resilience and Sustainability Facility. The remaining USD 11 bn will come from international partners including the World Bank, European Union, Japan, and the UK, Maait said.

Morgan Stanley sees us securing funding from the World Bank and the EU in the coming days, according to a report seen by Enterprise. A senior government official told Enterprise that we can finalize the agreements with the EU and the World Bank shortly after the IMF executive board approves the USD 8 bn program — the board will meet to consider the pact before the end of March.

ALSO FROM THE DEPARTMENT OF GOOD NEWS- Morgan Stanley also expects credit rating agency Moody’s to upgrade Egypt’s rating to B3 from Caa1 and sees a mega jump in the country’s FX reserves to USD 58.3 bn by the end of the year and to USD 67.4 bn in 2026.

** Moody’s has just upgraded its Egypt outlook to positive. We have the full story in the news well, below.

Maait’s comments received attention from: Bloomberg | Reuters.

Moody’s upgrades Egypt’s outlook to positive

Moody’s has upgraded Egypt’s outlook to positive from negative, affirming its Caa1 rating — seven rungs into junk territory — the credit rating agency wrote on Thursday. The agency cited the USD 35 bn Ras El Hekma investment and recent policy measures taken by the Central Bank of Egypt (CBE) which helped the country access a bigger package from the International Monetary Fund.

Macroeconomic rebalancing: The FX inflows from the Ras El Hekma agreement are expected to cover the country’s external financing gap until the fiscal year 2025-2026 — which Moody’s estimates at USD 15 bn — and strengthen “macroeconomic rebalancing,” the rating agency said. In addition, the central bank’s decision to float the currency and hike interest rates by 600 basis points will “reduce the risk of a renewed build-up of external imbalances and strengthen the economy's shock resilience over time,” it added.

Risks of a downgrade: “Persistently weak debt affordability that undermines confidence in the government's capacity to service its local currency debt stock would likely lead to a downgrade, as would a renewed build-up in FX shortages as a result of a larger than expected foreign exchange backlog or incomplete currency reform implementation,” Moody’s warned.

Remember: Moody’s in January downgraded Egypt’s credit outlook to negative from stable, citing concerns that the IMF support may be insufficient to ward off macroeconomic challenges and currency instability in the country.

FinMin reax: Finance Minister Mohamed Maait said that Moody’s bullish outlook will help attract more investments, and he expects other credit rating agencies to follow suit, upgrading their outlook on Egypt within the next few months, according to a statement from the Finance Ministry.

S&P also turned bullish on Egypt’s future: S&P Global Ratings says it “has been encouraged” by the float of the EGP, the expanded IMF package, and the unexpected Ras El Hekma investment, S&P Global Ratings analyst Trevor Cullinan told Reuters. “The Egyptian authorities are making really positive statements. Taken on face value they seem committed to this whole reform strategy, but as we know events can derail a government and we will wait and see.”

Remember: S&P downgraded Egypt’s sovereign credit rating in October to B- from B on the back of the FX shortage and rising uncertainties about debt sustainability.

What’s next? The rating agency’s Egypt review is scheduled to come out on 19 April.

Investors pour funds into Egypt’s first local currency t-bill auction post-float

Investor appetite for local debt has returned post-float: The central bank raised EGP 87.8 bn in a one-year t-bill auction on Thursday — receiving offers for almost 3x the amount sold. The bills were sold at an interest rate of 32.3%. It also sold EGP 14.2 bn worth of six-month t-bills. Prominent investment banks like Goldman Sachs, Citibank, and Morgan Stanley were among the investors, Asharq Business reported, citing an unnamed government official.

Foreign investors contributed heavily: International investors bought up USD 825 mn (c. EGP 40.7 bn) of the EGP 102 bn-worth of bills sold, according to Reuters.

Remember: A senior Finance Ministry official told us last week that a 30% or higher return on t-bills is squarely in the range that they’ve been told by foreign institutions would bring them back.

Driving the rally: The recent wave of reforms — EGP float and jumbo rate hike — paired with incoming liquidity from the Ras El Hekma agreement and the USD 8 bn IMF agreement has restored investor confidence in local debt.

A vote of confidence: HSBC said it is optimistic that Egypt’s economy can stabilize and return to growth following the recent policy measure, but thinks that it will take time for the EGP to “find its level” — seeing the exchange rate settling in the range of EGP 40-45 to the USD, HSBC said in a note seen by Enterprise.

Don’t get too excited: Growth will “take longer to turn, however, as fresh fiscal and monetary tightening take their toll and real wages stall,” the bank added.

Also helping: JPMorgan and Citigroup recommended buying one-year EGP t-bills, with Citigroup telling its clients to stop-loss if the EGP weakens to 60 against the greenback. Meanwhile, BlueBay Asset Management bought up local t-bills after five years of being wary — “We are constructive short term, because they've delivered pretty much everything apart from a cabinet reshuffle,” the firm's EM head Polina Kurdyavko said.

We’re not expecting the hype to die anytime soon: Egypt is now offering the third-highest yield on local-currency bonds among 23 emerging markets tracked by Bloomberg. “The next trade probably is Egypt local,” the news outlet quoted Vanguard Asset Services’ Nick Eisinger as saying. “Now that the foreign exchange rate is cheaper, rates have risen and the funding outlook is stronger and not many people own Egypt local, we would buy local,” he added.

Egypt’s banks traded USD 1.9 bn in two days since currency float

Banks have bought and sold some USD 1.9 bn on the interbank market since Wednesday morning, when the central bank unveiled its decision to move to a flexible EGP exchange rate and hike interest rates by 600 basis points, Asharq Business reported, citing four unnamed bankers. The USD is currently changing hands in banks at 49.3-49.7.

CREDIT CARD RESTRICTIONS EASING-

Banks have started easing FX spending limits: State-owned National Bank of Egypt (NBE) and Banque Misr, CIB, and the Arab African International Bank (AAIB) were among the banks who have revised their monthly credit card FX spending limitsafter the CBE instructed banks to gradually lift restrictions on credit card FX transactions.

NBE has raised the cap on FX transactions to the equivalent of EGP 25k-160k — depending on the card’s segment — from EGP 7k-85k, according to the bank’s website. Meanwhile, it raised the cap on FX withdrawal abroad to EGP 2.5k-7.5k.
Banque Misr has raised the ceiling on FX transactions abroad to the equivalent of EGP 10k-200k from EGP 6k-95k, according to the bank’s website. Meanwhile, it raised the ceiling on FX transactions at home to EGP EGP 25k from EGP 7.5k. FX withdrawals were kept unchanged.
CIB has raised the ceiling on FX transactions abroad to the equivalent of EGP 25k-175k from EGP 15k-100k, according to a statement (pdf) from the bank. Meanwhile, it raised the ceiling on FX transactions at home to EGP 3.5k-12.5k from EGP 2k-7.5k. FX withdrawal limits were kept unchanged.
AAIB has raised the cap on FX transactions abroad to the equivalent of EGP 50k-150k from EGP 25k-75k, the bank’s website showed. Meanwhile, it raised the cap on FX transactions at home to USD 1k from USD 250. FX withdrawal limits were kept unchanged.

Debit card limits are here to stay: The CBE has no intention to fully scrap limits on debit cards, a CBE official told Asharq Business.

Egypt ramps up efforts to clear import backlog following currency float

Import backlogs soon to be a thing of the past? The government signaled that it has the will and the ability to clear the backlog of goods in ports stemming from the FX shortage through a visit to Alexandria Port by Prime Minister Moustafa Madbouly on Thursday to oversee the release of goods and to make a televised address to the press (watch, runtime: 17:38).

By the numbers: Madbouly announced that USD 231 mn worth of strategic commodities — excluding gold and oil products — and some USD 464 mn worth of production materials were released between 1-6 March. Over USD 12 bn worth of goods had been released since 1 January, Egyptian Customs Authority (ECA) head El Shahat Ghatwary said.

Strategic commodities and production inputs are priority number one: Food, medicine, animal feed, oil products, raw materials, and production requirements are at the top of the list when it comes to making FX available to speed up the release of goods, Madbouly said. Providing FX to release finished products and consumer goods will be at the bottom of the state’s list of priorities, Madouly added, emphasizing the “the necessity of deepening local industrialization, and the importance of replacing imported products with locally manufactured products.”

ICYMI- An influx of FX from the Ras El Hekma agreement spurred a presidential directive early last week to “immediately release goods from Egyptian ports.” Meanwhile, banks exchanged around USD 1.9 bn via the interbank market over a two-day period following the currency float on Wednesday (We have the full story in the news well, above).

Egypt declares “war” on the black market: The Interior Ministry and security agencies have been told to clamp down on the parallel market and informal transactions with an “iron fist,” Madbouly said at the presser. He described efforts to unify the exchange rate “as by all accounts a war — a war to ensure and restore balance once again to the Egyptian economy”

Egypt’s new capital’s USD 4.8 bn second phase to break ground in 2024. PLUS: TMG to kick off its first overseas project next month, HHD receives offers from developers

In case you needed another reminder that the real estate and construction sectors are gearing up for a busy few years to come, the new capital is set to kick off work on its second phase next year, another Egyptian real estate giant gets ready to begin developments in the GCC, and foreign capital seems increasingly eager on getting a piece of the action.

PHASE TWO OF NAC TO KICK OFF NEXT YEAR-

Pulse check on phase two of the new capital: The Administrative Capital for Urban Development (ACUD) will start construction on the second phase of the new administrative capital (NAC) early next year at a cost of EGP 240 bn (c. USD 4.8 bn), ACUD head Khaled Abbas told Asharq Business.

This is later than expected, but also cheaper: Abbas said in 2023 that ACUD plans to kick off construction on the second phase in 2Q 2024 or 3Q at the latest. Abbas also originally said that the second phase would cost over EGP 300 bn — a 25% higher estimate than is now being touted by Abbas — on the back of rising costs.

ACUD has already had a productive 2024: Since the start of the year, ACUD has landed five new partnerships worth a combined EGP 180-200 bn and has approved ten bids for land worth a combined EGP 1.25 bn, Abbas added.

And there’s plenty more in the pipeline for 2024: The company is looking to raise at least EGP 150 bn when it offers 5-10% of its shares on the EGX in 2Q 2024, in what could be the country’s largest ever IPO. The military currently owns 51% of ACUD and the Housing Ministry holds the remaining 49%.

A smart capital? ACUD signed a shareholders’ agreement with French IT giant Atos to set up a joint venture to manage and operate smart tech services in the new capital, according to a CIT Ministry statement announcing the opening of Atos’ global delivery center in Egypt.

TMG GROUP TO START SAUDI EXPANSION NEXT MONTH-

TMG’s first foray into Saudi Arabia will soon be off the ground: Talaat Moustafa Group (TMG) will kick off construction on its Benan City project in Riyadh mid-April, CEO Hisham Talaat Moustafa told Asharq Business, explaining that construction is expected to take around eight years to complete The final agreement (pdf) for the land purchase was inked last week.

Cost estimates are up: Moustafa told the outlet that the project would be set up with investments exceeding SAR 65 bn (c. USD 17.3 bn) — 63% above an initial price estimate of SAR 40 bn (c. USD 10.7 bn) when the project was first announced in September in a TMG statement.

Benan City? The smart city is being developed in eastern Riyadh’s Al Fursan in partnership with the Saudi National Housing Company. It will house around 27.8k residential units, along with a sports club and health, educational, and commercial services. The project marks the Egyptian real estate giant’s first overseas project.

NEW HELIOPOLIS SEES INTEREST FROM INT’L DEVELOPERS-

Heliopolis Housing and Development (HHD) has received four bids to develop New Heliopolis, including an unnamed UK firm that wants to build an outlet mall for commercial brands, CEO Sameh El Sayed told Asharq Business, without providing any further details.

We know Madinet Masr is interested: The real estate developer has submitted an offer to develop three land plots with a total area of 580 feddans in New Heliopolis.

As for its other projects: HHD is in the final stages of inking an agreement with a German hospitality firm to develop Cairo’s Granada complex, and has received an offer from an unnamed firm to develop the Merryland Park, El Sayed added.

More free floating HHD shares? HHD majority owner Holding Company for Construction and Development will not offload another stake in HHD — be it on the EGX to a strategic investor — prior to developing the real estate developer and upping its market value, the holding company’s executive managing director Hani Soliman told Al Borsa.

Raafat Hindy named as new interim NTRA head

New boss at the helm of NTRA: The CIT Minister Amr Talaat has appointed Raafat Hindy (LinkedIn) as interim head of the National Telecommunications Regulatory Authority (NTRA), following the resignation of Hossam El Gamal (LinkedIn), according to a ministry statement. Hindy will retain his role as deputy CIT minister alongside his new position.

El Sisi on the EGP float, Gaza + Al Ahly takes the Egypt Cup home

El Sisi’s take on the float:President Abdel Fattah El Sisi’s addressed Egyptians for the first time since Wednesday — when the central bank floated the currency and hiked rates — yesterday in a speech during the Armed Forces Cultural Symposium.

Why now? El Sisi refused to allow an EGP float last year due to “national security reasons,” he said (watch, runtime : 2:14:48). Egypt needed “a large amount of funding” to regulate the market prior to a float, which was acquired via the USD 35 bn Ras El Hekma project and the larger IMF package we secured last week.

On the bright side: Egypt has lived in a major crisis for the past four years but “it will not be long before the Egyptians celebrate the fruits of their dedication, patience and investments in building the future of this homeland,” El Sisi added.

AND- The reconstruction of Gaza will cost over USD 90 bn according to early estimates, El Sisi said. “Egypt is committed to pursuing efforts toward reaching a ceasefire [in Gaza], delivering aid, and providing relief to those affected by this massive disaster. Egypt will tirelessly work, no matter the cost, toward securing the brotherly Palestinian people’s legitimate rights in their independent state,” El Sisi said.

El Sisi’s speech received wide coverage: Kelma Akhira (watch, runtime: 2:19 | 3:46), Ala Masouleety (watch, runtime: 3:46 | 2:42), Masa’a DMC (watch, runtime: 1:46), and Al Hayah Al Youm (watch, runtime: 6:42) all had coverage.

ALSO ON THE AIRWAVES-

#1- Authorities crack down on corrupt officials: Several employees at the Social Solidarity Ministry have been arrested on charges of forgery, embezzlement of public funds, and bribery, reported eXtra News (watch, runtime: 1:43).

#2- Al Ahly crowned Egypt Cup victors: Al Ahly Club won the Egypt Cup after defeating Zamalek 2-0 on Friday. The victory was celebrated across the airwaves with coverage from Kelma Akira (watch, runtime: 6:43) and Ala Masouleety (watch, runtime: 3:54).

The int’l press took a look at barriers preventing Egyptian women from entering the workforce this International Women’s Day

Women at work: The Wall Street Journal took a look at the impact of low levels of female employment on Egypt's economy, despite progress equalizing education opportunities. Barriers to women’s entry into the workforce is “grounded in a specific idea of male dignity,” the WSJ writes, yet their addition to the labor market could see the average household income rise by as much as 25%.

Al Ahly CIRA’s Saxony Egypt will open its doors in September

EDUCATION-

Al Ahly CIRA’s Saxony Egypt University to kick off operations for the academic year 24-25: Al Ahly CIRA — an EGP 2 bn education investment company set up by CIRA Education and Al Ahly Capital Holding in 2021 — will commence operations at the Saxony Egypt University of Applied Sciences and Technology (SEU) in September after it received the greenlight from the cabinet, CIRA Education said in a press release (pdf). The private technological university will offer two-year diplomas and four-year bachelor’s degrees and is expected to begin operations with six programs including automotive, nursing, management, public health, logistics and sports management. A further 50 specialized programs will be launched within five years.

What they said: “SEU represents the largest private sector initiative focused on bringing technological education to the forefront in Egypt. This innovative endeavor is set to be a game changer, empowering emerging industries and services in Egypt across various disciplines,” CIRA CEO Mohamed El Kalla said.

TELECOMS-

Vodafone faces EGP 20.5 mn fine after last week’s outages: The National Telecommunications Regulatory Authority fined Vodafone Egypt EGP 20.5 mn and directed the company to compensate customers affected by the mobile operator’s technical glitch on Tuesday, according to an authority statement (pdf). The glitch prevented Vodafone users from accessing 4G mobile or data services Tuesday mornings.

CAPITAL MARKETS-

FRA takes another step towards launching its voluntary carbon market: The Financial Regulatory Authority (FRA) has issued the registration and delisting rules for companies looking to sell certified carbon credits on the EGX, according to an FRA statement.

Remember: The state’s financial regulator last month authorized three bodies to verify projects that claim to reduce carbon emissions, as the government takes the necessary steps to launch Africa’s first voluntary carbon market — a plan which first saw the light in 2022.

LEGISLATION-

Draft law to cap pretrial detention: The House’s Legislative and Constitutional Affairs Committee greenlit the draft Criminal Procedures Law on Thursday, which reduces the maximum duration of pretrial detention and argued that it should be used as a precautionary measure and not as a punishment. The draft law will be presented to the House ahead of the next plenary session.

ECB, Fed hint at upcoming rate cuts

ECB hints at June rate cut: The European Central Bank (ECB) maintained borrowing costs at historically high levels when it met on Thursday but hinted at a shift, with a first interest rate cut potentially coming in June following the publication of 1Q 2024’s wage data, Reuters reports. “We will know a little more in April, but we will know a lot more in June,” ECB President Christine Lagarde said at a press conference.

Meanwhile, across the Atlantic, Federal Reserve Chair Jerome Powell said the bank is “not far” from the confidence it needs in a sustained decline of inflation to its target 2% before considering rate cuts, Reuters reported. Powell’s remarks helped spur investor confidence in a potential June rate cut, leading to a rally in the S&P 500 that led to a record closing high on Thursday. The Nasdaq also hit an intraday record high and narrowly missed a closing high, settling up 1.5%. Both indices erased most of their gains on Friday — the S&P 500 was down 0.7%, while the Nasdaq fell 1.2%.

EGX30	31,3001	+5.2% (YTD: +25.7%)
USD (CBE)	Buy 49.33	Sell 49.47
USD at CIB	Buy 49.3	Sell 49.4
Interest rates CBE	27.25% deposit	28.25% lending
Tadawul	12,578	+0.1% (YTD: +5.1%)
ADX	9,234	+0.1% (YTD: -3.6%)
DFM	4,253	+0.4% (YTD: +4.8%)
S&P 500	5,124	-0.7% (YTD: +7.4%)
FTSE 100	7,660	-0.4% (YTD: -1.0%)
Euro Stoxx 50	4,961	-0.3% (YTD: +9.7%)
Brent crude	USD 82.08	-1.1%
Natural gas (Nymex)	USD 1.81	-0.7%
Gold	USD 2,185	+0.9%
BTC	USD 68,536	0.0% (YTD: +62.1%)

THE CLOSING BELL-

The EGX30 rose 5.2% at Thursday’s close on turnover of EGP 6.6 bn (44.2% above the 90-day average). Egyptian investors were net buyers. The index is up 25.7% YTD.

In the green: Abu Dhabi Islamic Bank (+9.8%), CIB (+9.5%), and E-finance (+9.0%).

In the red: Juhayna Food Industries (-4.4%), Ibn Sina Pharma (-4.1%), and Madinet Masr (-3.4%).

Shoukry, Egyptian delegation talk economic cooperation in Kenya

Kenyan economic cooperation on the horizon? Four MoUs and several joint cooperation agreements were signed between Egypt and Kenya in the fields of maritime transport, electricity, agriculture, and veterinary services. This came during an Egyptian delegation’s — led by Foreign Minister Sameh Shoukry — time in Nairobi for the Egyptian-Kenyan Joint Committee. Shoukry also met with his counterpart Musalia Mudavadi and Kenyan President William Ruto to discuss expanding bilateral trade and investment.

The private sector also showed up: The foreign minister was also joined in the Kenyan capital by representatives from over 25 private sector Egyptian companies who were in town for a joint business forum with Kenyan companies.

CALENDAR

2024

MARCH

11 March (Monday): First day of Ramadan (TBC).

20 March (Wednesday): End of sugar export ban.

28 March (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

28 March (Thursday): Industrial Development Authority to close applications for 1 mn sqm of land in 10 different governorates.

29 March (Friday): Egypt removed from JPMorgan Chase’s Emerging Local Markets Index Plus.

APRIL

1 April (Monday): Deadline to bid for 23 blocks in an international oil and gas tender.

9 April (Tuesday): Eid El Fitr (TBC) (national holiday).

15-21 April (Monday-Sunday): The IMF / World Bank Spring Meetings.

25 April (Thursday): National holiday in observance of Sinai Liberation Day (TBC) (national holiday).

26 April (Wednesday): Clocks move forward one hour at midnight as daylight saving time starts.

28 April (Sunday): Grace period to ins. brokerage firms to comply with Law 215 for 2023 expires.

28-29 April (Sunday-Monday): Saudi Arabia hosts a World Economic Forum (WEF) meeting on ‘global collaboration, growth, and energy.’

29 April (Monday): The government’s car export scheme expires.

MAY

1 May (Wednesday): National holiday in observance of Labor Day (TBC) (national holiday).

5 May (Sunday): Coptic Easter.

6 May (Monday): Sham El Nessim (national holiday).

20 May (Monday): Malaysian Palm Oil Forum in Cairo, with attendance from Malaysian Plantation and Commodities Minister Johari Abdul Ghani.

23 May (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

29 May (Wednesday): Virtual launch of Chicago Booth Executive Program.

JUNE

15-19 June (Saturday-Wednesday): Eid El Adha (TBC) (national holiday).

30 June (Sunday): June 30 Revolution Day (national holiday).

JULY

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

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

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

SEPTEMBER

2-5 September (Monday-Thursday): Egypt International Airshow, El Alamein International Airport.

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

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

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

OCTOBER

6 October (Sunday): Armed Forces Day.

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

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

NOVEMBER

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

DECEMBER

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

EVENTS WITH NO SET DATE

January 2024: The Red Sea Ports Authority is set to finalize an agreement with the Abu Dhabi Ports Group for the operation and maintenance of the tourist passenger terminal in the Sharm El Sheikh Sea Port.

February 2024: Egypt will sign a USD 1.5 bn financing agreement with the International Islamic Trade Finance Corporation (ITFC).

February 2024: Funds from the Islamic Development Bank for the high speed electric railway will get the sign off.

April 2024: President Abdel Fattah El Sisi will visit Turkey.

1Q 2024: Egyptian-Qatari Joint Supreme Committee.

1Q 2024: Opening of the newly developed Pyramids Plateau in Giza.

1Q 2024: The government is set to finalize the sale of the Gabal El Zeit wind farm.

February-May: The Grand Egyptian Museum could officially open to visitors.

March 2024: The USD 2.7 bn MIDOR Refinery is set to begin full operations.

May 2024: Arab Finance Ministers’ meeting at Egypt’s administrative capital.

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.

1H 2024: The European Union is set to hold an investment conference in Egypt during spring.

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

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

EVENTS WITH NO SET DATE

2Q 2025: Safaga Terminal 2 to start operations.

2027

EVENTS WITH NO SET DATE

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

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