Israel + Chevron appear to have pulled the plug on our gas imports

1

WHAT WE’RE TRACKING TODAY

MPs pass tax hike on cigarettes

Good morning, wonderful people. It looks like you can thank Israel’s war on Gaza for the extension of our rolling blackouts — and surprising exactly nobody who’s been house-hunting of late, worries about further devaluation have driven up prices in the real estate market.

On the good news front: We have a ton of manufacturing announcements. Schneider Electric is committing fresh capital to expand its Badr City plant, Samsung is investing more in a new mobile phone facility than previously expected, and more golden licenses have just been issued. It underscores a big theme taking shape for 2025: If you make something here for export, the future is looking awfully bright (if you’re not paying credit-card interest rates to build or expand your facility…)

THE BIG STORY ABROAD remains Israel’s war on Gaza. We have the latest developments in this morning’s War Watch, below.

The business press is now focused on what it all means for the oil market: Oil prices fell in a response to Israel’s “more cautious” ground offensive in Gaza. Brent oil prices dropped below USD 90 a barrel earlier this morning after a 1.1% decline. This comes at a time when investors are bracing for volatility in the oil market, with expectations that Brent prices could jump past the USD 100 a barrel mark. (Bloomberg | Reuters | Wall Street Journal)

^^ We have more on the jitters gripping stock market investors and commodity traders in this morning’s Planet Finance, below.

HAPPENING TODAY-

#1- More empty talk of a ceasefire? The UN Security Council is meeting today for a UAE-requested emergency session on the war in Gaza in which the UAE will try to reach a binding resolution for an immediate humanitarian pause to the fighting in Gaza, CNN reports, citing unnamed sources.

The US has so far used its security council veto to blocktwo resolutions calling for a ceasefire — one that would have called for a temporary truce to allow the entrance of humanitarian aid and another for a full ceasefire put forward by Russia. The US instead advanced its own competing draft resolution calling for a humanitarian pause instead of a ceasefire, which was blocked after the UAE, China, and Russia voted against it.

#2- Zero-coupon bond auction: The Central Bank of Egypt will issue EGP 750 mn worth of three-year zero-coupon bonds today, Al Mal reports. Zero-coupon bonds are debt instruments that do not pay interest, but are bought and sold at a heavy discount.

Remember: The government resurrected zero-coupon bonds in 2021 after almost five years as part of its efforts to diversify its sources of funding and prioritize long-term debt.

#3- G7 will set up its AI code of conduct: G7 leaders will meet today to agree on avoluntary code of conduct for companies developing advanced AI systems, according to a document seen by Reuters. The rulebook will contain guidance that “aims to promote safe, secure and trustworthy AI worldwide … and is meant to address the risks and challenges brought by these technologies.” This would mark the latest step in the Hiroshima Process — a G7 initiative to unify AI rules and establish a coordinated approach to AI governance.

WATCH THIS SPACE- The Biden White House is also expected to release AI guidelines this week, though they may be tougher (and less voluntary) than what the G7 has in mind. Politico, which broke the news, says the executive order will look to “alter the AI landscape” and will set “numerous” federal agencies to work looking into the risks of AI alongside new uses for the technology.

HAPPENING THIS WEEK-

The CBE’s Monetary Policy Committee will meet on Thursday to review rates. We’ll be out with our customary pre-MPC poll later this week.

It’s also Fed week: The Federal Reserve kicks off its two-day policy meeting tomorrow. Investors have an eventful Wednesday ahead as they await the US Treasury’s announcement regarding its quarterly refunding plan to be unveiled hours before the Fed announces its decision on interest rates, Bloomberg noted.

SIGN OF THE TIMES-

#1-Egyptian travel giant Travco has seen cancellations for reservations through the end of the year hit the 50% mark as holidaymakers look to other corners of the world on concerns over Israel’s war on Gaza, Asharq Business reports.

Who’s canceling? Holidaymakers from Germany, England, Belgium, and Sweden are the primary sources of cancellations, the business news outlet quotes Travco boss Hamed El Chiaty as saying.

Watch this space: Cancellations could spill over to next year, as bookings for the new year have slowed down significantly since the outbreak of hostilities, El Chiaty reportedly added.

#2- Egypt and Turkey, BFFS: Egypt’s Foreign Ministry yesterday congratulated Turkey on its 100-year anniversary of the founding of its republic. “We look forward to strengthening our historical relations, building on the distinguished bonds of friendship and cooperation,” the ministry’s spokesperson said.

IN THE HOUSE-

Smokes are getting pricier: The House yesterday passed a government-drafted amendment to the VAT Act imposing an EGP 0.50 VAT on all tobacco products, including heated tobacco products and liquid tobacco. House Planning and Budget Committee head Fakhri El Fiqi said that the tax will raise some EGP 8 bn, while House Agriculture Committee head Hesham El Hosary recommended that the proceeds from the tax “be used to spend on health services.”

The news comes as the market continues to grapple with a shortage of cigarettes that has sent prices spiraling and seen parallel-market imports. Just around 33% of adult males in Egypt smoke, according to CAPMAS figures out earlier this year.

Another move to boost exports: The House also passed a bill establishing the EgyptianExport and Investment Guarantee Agency (EEIGA) to promote Egyptian exports — replacing the Export Credit Guarantee Company of Egypt. The move comes amid government efforts to increase exports to USD 100 bn a year by the middle of the decade.

About the EEIGA: The new agency, like the one it is replacing, will facilitate the export processfor Egyptian exporters, offering them credit guarantees and technical assistance. It will have a paid-up capital of EGP 50 mn and an authorized capital of EGP 600 mn. It remains unclear how the new agency will differ from the one it is replacing.

On the agenda today: The House will discuss and vote on three draft bills authorizing the OilMinistry to contract ExxonMobil and Pico Petroleum to explore for oil in the Mediterranean and Gulf of Suez in partnership with various local players. A bill will also be put forward to establish a new National Council for Childhood and Motherhood. MPs will also vote on a EUR 670k grant from the Spanish Agency for International Development Cooperation to help overhaul how the agriculture sector uses water, and a USD 500 mn loan from Deutsche Bank and Bank ABC to support the state budget.

DATA POINTS-

#1- Families on USD 5k+ incomes down 65% this year, says Fitch Solutions: The number of Egyptian families earning over USD 5k a year is set to fall to 12.1% of the population in 2023, from 34.2% of families in 2022, according to data from Fitch Solutions, reports Al Borsa. The number of families earning over USD 10k will fall to 1.6% of the population from 4.5% in 2022.

#2- Gold reserves slip:Egypt’s gold reserves fell 2.8% to EGP 235.6 bn in September from EGP 242.4 bn the month before, Ahram Online reported citing data from the central bank.

Israel halts gas exports to Egypt amid Gaza war

Israel halted all gas exports to Egypt earlier this month as the war in Gaza disrupts production in the Eastern Mediterranean. In a statement yesterday, the Madbouly cabinet said that the country’s gas imports have fallen to zero from a previous 800 mn cubic feet of gas per day — and named it as one of the main reasons for the worsening blackouts that began a few days ago. Egypt hasn’t imported any gas for several weeks, Cabinet spokesperson Sameh El Khashin said in a televised interview last night (watch, runtime: 9:10).

Field closed, supplies diverted: The war in Gaza had an immediate effect on Egypt’s energy security after Israel ordered Chevron to close its second-largest field, Tamar, a few days into the war. Egypt’s gas imports fell almost 20% following the decision. The following day Chevron announced it had suspended all exports to Egypt via the EMG pipeline and that it would begin routing supplies through the Arab Gas Pipeline that links Israel, Jordan and Egypt. Additionally, gas from the Leviathan field has been diverted away from Egypt, according to Chevron, which said last week that it was prioritizing deliveries to Israel. It said it was still fulfilling part of its contracted shipments to Egypt, without saying how much.

This should be temporary: “Israel informed Egypt of the cessation [in early October] and stressed that stopping work in the Tamar field is only a temporary cessation,” local media previously quoted an Egyptian government official as saying. With the Israeli government preparing for a long war, that might not be anytime soon.

This doesn’t bode well for our ambitions to up LNG exports: Even before the suspension of gas imports, our LNG exports were down heavily on the year due to high seasonal demand and declining gas production. The value of the country’s gas exports fell almost 60% y-o-y to USD 2.3 bn during the first seven months of the year, with hardly any cargoes leaving Egypt since the start of the summer.

Remember: The nationwide power outages that have been ongoing since July have been worse this week, with the Electricity Ministry extending the duration of daily power cuts to at least 90 minutes from one hour previously. The cabinet also blamed declining renewable energy output as well as unseasonably warm weather for the longer blackouts.

The news got attention internationally:Bloomberg | Reuters.

Gaza civilians increasingly desperate as Israel expands ground offensive, though aid shipments could be increasing

Things you need to know on day 23 of the war on Gaza as Israel widens its ground offensive:

There are signs that pressure from the Biden administration could see Israel start to allow more aid into Gaza
Gazan are becoming even more desperate after more than three weeks under total siege;
Biden has for the first time publicly rejected the displacement of Palestinians out of their homeland, a stated aim of hardliners in the Israeli government;
Washington still isn’t on board for a “pause” (let alone a ceasefire).

DIPLOMACY-

US does not support Palestinian displacement, Biden tells Sisi: Speaking with President Abdel Fattah El Sisi yesterday, US President Joe Biden expressed opposition to the displacement of Palestinians into Egypt and agreed on the need to accelerate aid deliveries to Gaza, the White House said. The two leaders agreed on the need to avoid regional escalation, though the US readout made no mention of a ceasefire or a “humanitarian pause.” El Sisi reiterated calls for an immediate ceasefire, according to Ittihadiya.

Efforts to increase aid are accelerating: The US’s Middle East humanitarian envoy David Satterfield was in Cairo yesterday to discuss aid efforts with Foreign Minister Sameh Shoukry, while Biden pressed Israeli Prime Minister Benjamin Netanyahu to “immediately and significantly increase the flow of humanitarian assistance” in a phone conversation yesterday. Egypt and the US have been working to speed up deliveries with Israel, which Egypt has accused of obstructing aid. As of Saturday, just 84 trucks had entered the enclave since the war began on 7 October.

We’re starting to see results: A convoy of 48 trucks crossed the border at Rafah, carrying food, water and medical supplies, Al Qahera News reported last night (watch, runtime: 0:31). Another 60 trucks are expected to make it into Gaza today.

It’s still not enough: The UN has said that 100 trucks of aid are needed every day to stave off the growing humanitarian crisis in the strip. Israel is continuing to block fuel supplies from entering, leaving humanitarian aid efforts, hospitals and bakeries on the verge of collapse.

Shoukry follows up with Saudi, Jordan foreign ministers: Shoukry yesterday spoke to his Saudi counterpart, Prince Faisal bin Farhan, for the second time in as many days, and to Jordan’s Foreign Minister Ayman Safadi to coordinate responses to the conflict, the Foreign Ministry said. The foreign minister also spoke with his Italian counterpart Antonio Tajani.

Egypt’s next step? “Egypt may take diplomatic steps that will limit the relationship between Israel and Egypt,” according to a media report quoting an unnamed Egyptian source. The report was picked up by state-owned Ahram Online. Egypt has sent “strong warnings” to the Israeli military not to operate within the buffer zone along the Egypt-Gaza border, several sources reportedly said. This comes a week after several Egyptian soldiers were injured after Israel fired on a border post. The IDF said the attack was accidental and apologized.

Plenty more diplomatic conversations:

US-Turkey talks amid Israel escalation: US State Secretary Antony Blinken yesterday “discussed the need for engagement with regional leaders” with Turkish Foreign Minister Hakan Fidan, according to a US State Department readout. The call comes in the wake of escalating tensions between Turkey and Israel after President Recep Tayyip Erdogan accused Israelis of being war criminals. Israel pulled its diplomatic staff from Ankara and said it was reconsidering its relations with Turkey in response to the speech.
Russia also looks to be in Israel’s bad books: Israel summoned the Russian Ambassador to Israel on Sunday to condemn Moscow’s hosting of a Hamas delegation last week. Hamas pledged to release eight Israeli-Russian dual citizens it has taken hostage following the talks in Moscow.

ON THE GROUND-

Israel is continuing its ground offensive: Hamas fighters battled Israeli soldiers and tanks in northern Gaza yesterday as the Israeli military pushed deeper into the besieged enclave. There were reports of clashes near Khan Younis in the south of the territory. Neither Hamas nor the Israeli military commented on the ongoing fighting.

Desperation is growing: Thousands of people looted food from a UN facility yesterday, the UN said, as the growing shortages of food and water take their toll on Gazas citizens. “This is a worrying sign that civil order is starting to break down after three weeks of war and a tight siege on Gaza. People are scared, frustrated and desperate,” a UN official said.

Comms blackout eases: Communications slowly returned in Gaza yesterday, two days after Israel severed phone and internet connectivity, though coverage over the north of the territory — where Israel is focusing its offensive — remains out. On Friday, a total communications blackout cut the enclave off from the outside world, and left aid teams unable to coordinate relief efforts and medical workers struggling to help the wounded.

The death toll keeps rising:More than 8k Palestinians have now been killed in Israeli airstrikes since the war began on 7 October, more than 3.3k of whom are children, according to the latest figures from the Gaza Health Ministry. More than 20k people have been injured.

Israel threatens to bomb hospital:The Palestinian Red Crescent said yesterday that Israel threatened to bomb the Al Quds hospital in Gaza City and ordered its evacuation. The Israeli military bombed several buildings next to the hospital to force out medical staff and patients, causing “significant damage to hospital departments,” it said. The hospital is currently providing refuge to thousands of people made homeless by the war, as well as hundreds of patients. The head of the World Health Organization expressed “deep concern” at the report.

ALSO-

Hezbollah-Israel clashes are continuing: Hezbollah said it downed an Israeli drone flying over south Lebanon yesterday in a first for the three weeks of tit-for-tat border clashes between the two sides.
Reuters journalist killed in targeted strike -RSF: Reuters video journalist Issam Abdallah, who was killed in Lebanon earlier this month, was deliberately targeted by a missile fired from Israel, according to preliminary findings from RSF.

Fears of devaluation drove Cairo real estate prices up in 3Q 2023 -JLL

Safe houses: Cairo’s residential housing market has been “gaining momentum owing to the continued fear of further devaluation” even as developers hike prices, global real estate consultancy firm JLL said in a statement (pdf) announcing its most recent quarterly Cairo Real Estate Market Overview. Heightened demand and soaring inflation have triggered a significant rise in property prices in the capital, with average prices in Sixth of October rising 40% in 3Q 2023 and 45% in New Cairo, according to the report. Prices in both areas were 38% higher than the previo us quarter.

Driving the trend: Many people are deciding to invest in real estate to hedge against a volatile EGP, driving up demand and causing prices to rise. Developers have also been hiking prices to offset the impact of inflation, leading several to report record sales figures this year.

Rents and deliveries are on the rise:

Residential rental prices continued their rapid rise in 3Q, increasing 22% y-o-y in Sixth October and 18% in New Cairo.
Unit deliveries rose about 17% on the previous quarter, with around 7k residential units handed over during the three-month period. This brought the number of units in major gated communities to 262k. Up to 9k new units are expected by the end of Q4.

New foreign ownership laws in the pipeline could give the industry a further boost: JLL expects the plan to lift the cap on the number of properties foreigners can own to further boost the market, as foreigners — especially from the Gulf — purchase holiday homes and second homes.

It’s a different story for the commercial property sector, which remains “subdued”: In contrast to residential units, the average office rent in Cairo decreased by around 3% y-o-y, settling at USD 361 per square meter per year, according to the real estate consultancy firm. While landlords initially raised rent prices in anticipation of a currency devaluation, rates stabilized as the threat became less immediate, according to the report. Office vacancy rates rose to 12% from 10% recorded during the same period last year.

Egypt’s golden licenses for investors are attracting mns of USD in fresh capital

We have plenty of manufacturing news for you this morning, much of it with an FDI spinas the state’s golden license initiative shows further signs of gaining traction — and as existing players in Egypt double down on their investments here.

The breakdown:

More golden licenses handed out: The General Authority for Investment and Freezones (GAFI) handed out four golden licenses yesterday to Samsung, GASCO, Fayoum Storage and Warehouses Company, and EgyptSat Auto, according to a GAFI statement.

#1- A mobile phone factory: South Korean electronics giant Samsung will invest USD 55 mn in its new mobile phone assembly facility at its industrial complex in Beni Suef. This is a little bit more than we were expecting after a GAFI source last week told us Samsung will invest some USD 50 mn in its new factory.

#2- EV factory: Local EV manufacturer EgyptSat Auto will build a EGP 300 mn factory in Tenth of Ramadan. The factory will have a monthly production capacity of 5k cars, with the first car to hit the market in 2H 2024, Chairman Mohamed El Ghamry told Enterprise.

#3-Boosting GASCO’s production capacity: State-owned Egyptian Natural Gas Company (GASCO) will invest USD 380 mn to expand its gas complex in Alexandria. The company will add a fourth production line with a capacity of 600 mn cubic feet a day.

#4-Warehouses in Fayoum: The Fayoum Company for Storage and Warehouses will work on a EGP 1.3 bn project to establish new strategic warehouses in Fayoum with a storage capacity of 75k pallets.

More to come? EnviroProcess will receive the golden license for its EGP 73.5 mn recycling plant for alternative fuels and fibers in Minya soon after the necessary paperwork is done, sources with knowledge of the matter told us.

**This story was amended on 5 November 2023 to remove coverage of Schneider Electric's investment plans, as we picked up incorrect figures from a news report. We have updated coverage in our issue published on Monday, 6 November 2023.

SODIC + Mashreq earnings jump in 9M 2023

Real estate developer SODIC’s net income rose 26% y-o-y to EGP 548 mn in 9M 2023, it said in a statement (pdf). The company’s revenues for the nine-month period rose 7% y-o-y to EGP 5 bn, driven by deliveries of East Cairo projects, namely in SODIC East and Villette’s Sky Condos.

Sales rise as company hikes prices: Gross contracted sales rose 67% y-o-y to EGP 19.8 bn despite a 20% fall in the number of units sold to less than 1.4k. The company has raised prices “significantly” this year to offset the impact of inflation. West Cairo projects accounted for 52% of the sales, followed by East Cairo projects (28%), and the company’s June development on the North Coast (20%).

(Remember: In real estate, “sales” are effectively signed contracts for new flats, while revenues is the fraction of past sales developers recognize as revenues as they hand over properties or hit construction milestones.)

The company’s deliveries in 9M 2023 declined almost 12% y-o-y, with 743 units delivered compared to 843 units delivered during the same period last year. Of the units delivered, 452 were in East Cairo, 287 were in West Cairo, and four were in the North Coast.

Looking ahead: “We are very happy to report record results showing significant growth across all key metrics, on track to deliver a very strong year,” said General Manager Ayman Amer. “During 2023 we have prioritized growing our business while safeguarding profitability, pacing our launches, and revising our pricing strategies, ensuring healthy returns on all our projects.”

MASHREQ NET INCOME DOUBLES IN 9M 2023-

Mashreq reports strong growth for the first nine months of the year: Emirati lender Mashreq’s net income rose 122% y-o-y to AED 5.8 bn in 9M 2023, according to its earnings release (pdf). The lender attributed its growth to an 82% y-o-y increase in net interest income to AED 5.6 bn, alongside a 15% rise in fee and commission income.

A strong 3Q performance: The lender’s net income jumped 89% y-o-y to AED 2.25 bn in 3Q 2023, up from AED 1.19 bn during the same period last year. Net interest income led the quarterly growth, with a 61% y-o-y jump to AED 2 bn.

Driving the growth: Mashreq has grown its loan portfolio almost 10% YTD to AED 99.3bn, while deposits saw a 16.7% YTD increase to AED 132.9 bn.

What they said: “We continue to see the benefits of our diversified business model and strong balance sheet growth and our digital strides in Pakistan and licensing in Oman usher in a new era of exciting global growth,” Group CEO Ahmed Abdelaal said.

Gaza war continues to top talk show coverage + extended blackouts

Egyptians tuned in to hear the nation’s hosts talk about the extension of rolling blackouts — unless the power was out. Diplomatic and on-the-ground updates from the ongoing tragedy in Gaza also continued to receive wall-to-wall coverage throughout the night.

Power cuts aren’t going away anytime soon: Cabinet spokesperson Sameh El Kheshengave interviews on several programs last night to explain the government’s decision to increase the duration of blackouts to two hours, including on Ala Masouleety (watch, runtime: 9:10) and Masaa DMC (watch, runtime: 7:37).

Gaza is on the verge of a humanitarian catastrophe: World Health Organization (WHO) regional programme management head Rana Hajjeh told Lamees El Hadidi on Kelma Akhira that Gaza is facing the risk of bodies trapped under rubble spreading disease and illness through the population. El Hadidi told viewers that of the 133 trucks that have so far entered the enclave, only 84 have reached their destination because of delays from Israeli-imposed inspection procedures (watch, runtime: 8:07 | 7:28 | 6:16).

Will Israel ever be held accountable for war crimes? Former Palestinian MP Minister Nabil Amr said on Kelma Akhira that the International Criminal Court can investigate Israeli war crimes in Gaza and that Israel can still be tried despite not being a member state (watch, runtime: 11:40). Palestinian Ambassador to the EU Abdel Rahim Al Farra appeared on Ala Masouleety and accused the US of being “involved and an accomplice” in Israel’s war crimes (watch, runtime: 7:09 | 5:43). Ala Masouleety also hosted Arab League Assistant General-Secretary Hossam Zaki who is preparing an international criminal case against Israeli Prime Minister Benjamin Netanyau and the leaders of the Israeli Defense Forces for their actions in the ongoing war on Gaza (watch, runtime: 3:43).

Also on the airwaves last night: The Supply Ministry’s decision to ban the trade, export, and import of precious metalsunless registered with the Assay and Weights Administration received considerable coverage on Ala Masouleety. Supply Minister official Nagy Farag clarified the details of the decision on the program, noting that Egypt has received about 2 mn tons of gold since the start of the customs exemption initiative (watch, runtime: 5:52).

Egypt’s NSPO to spin out new A1 brand of filling stations. PLUS: News from EKH, Accor, New Alamein, and more

ENERGY-

Military to launch new fuel retailer this year: The military’s National Service Projects Organization (NSPO) will launch a new line of filling stations under the brand A1 before the end of the year, Asharq Business said in a post on X (formerly known as Twitter). This comes as the Madbouly government looks for a buyer for a stake in NSPO’s Wataniya chain of gas stations.

More than half of Wataniya’s assets won’t be up for sale: The government said in August that it had spun off 174 of Wataniya’s 300 stations into a separate entity.

NSPO could still end up holding some of Wataniya via Taqa Arabia: The NSPO recently acquired a 20% stake in Taqa Arabia, which has submitted a non-binding offer to acquire a stake in Wataniya. The NSPO also owns the Chill Out fuel retailer via its National Company for Roads subsidiary.

HOSPITALITY-

Accor plans Egypt expansion: French hospitality group Accor plans to open seven new hotels in Egypt by 2027, adding 1.4k rooms to its portfolio, Chief Development Officer Maya Ziadeh told Asharq Business. Accor wants to expand into the new capital, the North Coast, New Assiut, New Alamein, and New Mansoura through its hotel brands Swissotel and Novotel, both of which are already present in the market.

Accor in Egypt: The company currently operates 28 hotels in Egypt across a number of governorates including Marsa Alam, El Gouna, Aswan, and Sharm El Sheikh.

REAL ESTATE-

Chinese construction giant to build more of New Alamein: China State Construction Engineering Corporation (CSCEC) has been contracted to design and construct the Crystal Lagoon project in downtown New Alamein, the Housing Ministry said yesterday. The lagoon will contain seven islands and will be surrounded by a tourist promenade, the statement said, without disclosing the contract’s value or the expected timeline for the project. CSCEC is already constructing five residential skyscrapers as part of the Alamein Downtown Towers project.

M&A-

EKH to increase its stake in BKH: Egypt Kuwait Holding (EKH) will increase its ownership of subsidiary Bawabet Al Kuwait Holding Company (BKH) — majority shareholder of Alexandria Fertilizers (AlexFert) — to 94.34% after purchasing a 9.45% stake from an undisclosed Kuwaiti company for KWD 14.65 mn (USD 47.5 mn), according to an EGX disclosure (pdf). The move will raise EKH’s direct and indirect stake in AlexFert to 75.13% from 69.48%. BKH is an investment company focused on the fertilizer and petrochemical sectors.

MANUFACTURING-

A German industrial zone in the SCZone? Egypt and Germany kicked off discussions about setting up a German industrial zone in the Suez Canal Economic Zone (SCZone) during a meeting last week, the Trade Ministry said in a stateme nt. The two sides also inked a cooperation protocol to enhance partnership in the fields of trade, investment, energy, SMEs, and climate.

Egypt has been expanding heavily on the industrial zone front. We dive into the ins and outs of the country’s industrial zone expansion in last week’s Inside Industry.

Gaza escalation fears continue to shape global markets, but not so much in the Middle East

It’s a crucial week for many anxious investors,who on top of closely following developments in Israel’s war on Gaza are also awaiting the results of the Federal Reserve’s monetary policy meeting scheduled for Tuesday and Wednesday, Reuters reported.

Some think it’s going to be a turbulent week for the oil market: It's shaping up to be another week of market volatility for oil and gas on the back of worries that the war in Gaza may escalate and disturb Middle East supplies. Brent crude finished trading 2.9% up at USD 90.48 on Friday and some traders are entering into options contracts that see we're going to go past the USD 100 a barrel mark, according to Bloomberg.

But despite the panic elsewhere, Mideast markets remain calm: Investors in Middle Eastern stocks showed “little sign of panic” that the war on Gaza is set to escalate substantially, with markets remaining more or less unchanged during yesterday’s trading, Bloomberg wrote. Tel Aviv’s benchmark index rose 1.3% during yesterday’s trading, following three days of closing in the red, and the Tadawul All Share Index rose 0.7%. Meanwhile, the EGX30 fell 0.8% and Kuwait’s Premier Market Index fell 2.5%.

And some analysts seem to agree: “The near-term probability of an escalation severe enough to destabilize global financial markets — driving oil above USD 100 a barrel and triggering a major flight to safety — remains low,” Gavekal Research’s Tom Holland and Yanmei Xie said in a note Sunday picked up by Bloomberg.

ALSO WORTH NOTING- Google to invest USD 2 bn in AI company Anthropic through a convertible debt-for-equity arrangement. The agreement makes Google the second tech giant to invest in the OpenAI rival, after Amazon’s USD 4 bn investment last month. (Bloomberg)

EGX30	23,087	-0.8% (YTD: 58.1%)
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	10,483	+0.7% (YTD: 0%)
ADX	9,237	-0.1% (YTD: -9.5%)
DFM	3,787	+0.1% (YTD: +13.5%)
S&P 500	4,117	-0.5% (YTD: -7.2%)
FTSE 100	7,291	-0.9% (YTD: -2.2%)
Euro Stoxx 50	4,014	-0.9% (YTD: +5.8%)
Brent crude	USD 90.48	+2.9%
Natural gas (Nymex)	USD 3.48	+0.2%
Gold	USD 1,998.50	+0.1%
BTC	USD 34,68.52	+0.8% (YTD: 109.5%)

THE CLOSING BELL-

The EGX30 fell 0.8% at yesterday's close on turnover of EGP 4.8 bn (106.9% above the 90-day average). Local investors were net buyers. The index is up 58.1% YTD.

In the green: Beltone Holding (+15.8%), GB Corp (+7.7%) and Heliopolis Housing (+6.%).

In the red: Abu Qir Fertilizers (-6.5%), TMG Holding (-5.5%) and Mopco (-5.0%).

CALENDAR

OCTOBER

28-30 October (Saturday-Monday): The Annual International Manufacturing Convention & Exhibition.

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, 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
Saudi and Egyptian officials will meet to follow up on the project to connect the national power grids of Egypt and Saudi Arabia

NOVEMBER

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

3 November (Friday): Fitch to review Egypt’s sovereign credit rating.

5 November (Sunday): Senate back in session.

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

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

12 November (Sunday): Deadline for technical and financial offers for Misr Aluminium Company rehabilitation project (extended from 12 October)

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

14-15 November (Tuesday-Wednesday): Egypt VC Summit, Conrad Hotel.

15 November (Wednesday): Deadline for MTO to buyback Dice Sports and Casual Wear’s 46.9% Stake.

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.

Signposted to happen some time in November:

Egypt to issue Samurai bonds.
Bidding deadline for 5 gold mine concessions in the Eastern Desert (TBC).

DECEMBER

1-3 December (Friday-Sunday): Egyptian expats vote in the presidential election.

4-7 December (Monday-Thursday): Egypt Defence Expo, Egypt International Exhibition Center.

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.

10-12 December (Sunday-Tuesday): Voting in presidential election takes place in Egypt.

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

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

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

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 stake sale for military-owned fuel retailer Wataniya.
Gov’t expects to finalize sale of Zafarana wind farm
Kenyan trade conference in Egypt.

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.

25 February 2024 (Sunday): Deadline for bidders for oil and gas expansion in the 23 new regions.

Q1 2024: Opening of the new developed Pyramids Plateau in Giza.

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

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

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

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.

2024

JANUARY

7 January (Sunday): Coptic Christmas.

25 January (Thursday): Revolution day.

APRIL

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

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

MAY

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

5 May (Sunday): Coptic Easter.

6 May (Monday): Sham El Nessim (TBC).

JUNE

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

30 June (Sunday): June 30 Revolution Day.

JULY

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

23 July (Tuesday): Revolution Day.

SEPTEMBER

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

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

OCTOBER

6 October (Sunday): Armed Forces Day.

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