Lawmakers are pushing forward investment reforms, but the devil will be in the details

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What We're Tracking Today

THIS MORNING: Export subsidy payouts next week. PLUS: The UAE’s new investment ministry

Good morning, wonderful people, and a very happy THURSDAY to you all.We were expecting the news cycle to remain quiet through to the weekend — and as is so often the case, it has defied our expectations. There’s plenty going on this morning, from fresh macro data and research through M&A with a side of investment news.

THE BIG STORY here at home this morning: The country’s non-oil private sector contracted at a slower pace in June, according to S&P Global’s latest PMI data. We have all the details in this morning’s Economy section, below.

FDI is also a theme this morning,as we bring you news that the government has approved a land-allocation agreement for Scatec’s 5-GW wind farm in Sohag. Both cabinet and the House of Representatives, meanwhile, are pushing ahead with reforms they say are meant to improve the business climate and help attract foreign investors.

WATCH THIS SPACE- Will 5G licenses be the government’s next source of FX? The Communications Ministry is looking into offering licenses that would enable telcos to operate 5G networks, a source at the ministry told Enterprise, adding that the license fees would be paid in hard currency. All mobile network operators already have the bandwidths needed to run 5G networks, the source said. News of the planned licenses was first reported by Al Borsa.

Lots of potential capex spending: Operators are still facing difficulties with 4G network capacities and need to invest in the infrastructure that will enable them to support 5G speeds, our source said.

DOWNLOAD THIS- Are you tired of Twitter’s really horrible “For you” recommendations? Throttled by Elon’s limit on how many tweets you can read a day? Mark Zukerberg would be very happy if you were to download Threads this morning, a Twitter clone Meta’s Instagram has had in the works for some time now.

The UI is simple, clean and Twitter-like — and it’s dead-easy to set up and follow all the people you already follow on Instagram. It’s iOS only for the moment, with Android to follow, and you can download it here in the App Store.

So far, Threads isn’t a ghost town: Lots of folks from our IG are already there and posting up a storm. As much as we hate to give Zuck more of our digital attention, it’s probably worth a try.

HAPPENING NEXT WEEK-

FinMin to start to payout of export subsidies next week: The Finance Ministry will pay out the latest batch of export subsidies on 12-13 July, it said in a statement yesterday. The ministry was due to make the payments for companies that submitted applications in May on 5-6 July, but delayed them by a week after the start of the new fiscal year coincided with the Eid break.

Reminder: Subsides under this sixth phase of the program are being paid out in two tranches; a first tranche for companies that submitted applications in May, and a second for those that applied in June. The second round of payments will be made in August.

ICYMI- The government says it will quadruple export subsidies this fiscal year, with EGP 28 bn earmarked to the program in the hot-off-the-presses 2023-2024 budget. The larger allocation is aimed at helping the government reach its target to increase exports to USD 100 bn a year by the middle of the decade.

There’s once again no single BIG STORY ABROAD breaking through in the foreign press. The business press is widely covering US interest rate expectations: Federal Reserve officials signaled that further monetary tightening is on the table after leaving rates untouched for the first time in 15 months during their June meeting, according to the meeting minutes (pdf) released yesterday. “Almost all participants noted that in their economic projections that they judged that additional increases in the target federal funds rate during 2023 would be appropriate,” the minutes read. The Financial Times, Reuters, and the WSJ have more.

MEANWHILE- The UAE is getting an investment ministry: The UAE is planning to set up a new federal ministry for investment to stimulate the country’s investment environment and strengthen its position as a major player in the global economy, UAE prime minister and ruler of Dubai Sheikh Mohammed bin Rashid Al Maktoum’s announced on social media on Monday.

ADQ boss Mohammed Al Suwaidi will lead the ministry. He’s a smart guy who speaks the language of the private sector and has proven at the UAE sovereign fund that he knows how to lead — a smart choice.

MARKET WATCH-

Oil prices just won't budge, much to the chagrin of OPEC+: Oil cartel OPEC+ has been on a drive to lift declining oil prices via output cuts since November, with Russia and Saudi Arabia on Monday introducing additional supply cuts just three months after a surprise move by the bloc to cut oil production. While the April announcement brieflydrove crude prices up, bearish sentiment has since erased these gains, with Brent futures coming in at just under USD 76 per barrel on Tuesday.

What’s weighing on prices? The global oil market is facing pressures from multiple angles, including tightening financial conditions and concerns over global growth, analysts tell Reuters. China’s economic recovery following covid has been weaker than anticipated, sparking concerns about lackluster demand from the world's second-largest oil consumer, while leading central banks’ intentions to continue raising interest rates could weigh on oil demand among consumers and manufacturers. Meanwhile, US oil output has been growing faster than expected, and the Energy Information Administration estimates that crude production will rise by 720k barrels per day (bpd) to 12.61 mn bpd this year.

But KSA is undeterred: OPEC+ will do “whatever necessary” to support the market, Reutersquotes Saudi Energy Minister Prince Abdulaziz bin Salman as saying at the OPEC International Seminar in Vienna yesterday, citing a source who attended the meeting.

CIRCLE YOUR CALENDAR-

The Enterprise Finance Forum is taking place on 18-19 September at the St. Regis Hotel in Cairo. This flagship forum is the latest in our must-attend series of invitation-only, C-suite-level gatherings that allow senior members of our community to openly and frankly discuss critical issues in key sectors of the economy.

Day one is our Banking Forum, where we’ll dive deep into topics of interest to commercial and investment bankers, from an outlook on the 12 months to come in M&A, IPO, and debt capital markets to the national, regional, and global trends that are (re)shaping our industry.

Day two is all about Fintech and Non-Banking Financial Services. We’ll take a deep dive into everything from the magic of client acquisition to the prospects of consolidation and the coming of challenger banks.

** NEW: MORE NETWORKING TIME- Our agenda includes expanded networking time, including an expanded coffee break and a post-event networking room for you to interact with your peers and speak one-on-one with the team at Enterprise.

TAP OR CLICK HERE if you want to express interest in attending. We’ll be sending out the first batch of invitations soon.

Do you want to become a commercial partner? Ping a note to Moustafa Taalab, our head of commercial or fill out this form and we’ll be in touch.

DID YOU MISS THE ENTERPRISE EXPORTS AND FDI FORUM? Tune in to the Enterprise Podcast and listen for yourself: The Enterprise Podcast is back with another installment of our forum series, where we bring you audio recordings of what was said on stage at the Enterprise Exports and FDI Forum,which took place in May.

WANT TO LISTEN? Head to: Apple Podcast | Spotify | Google Podcast | Anghami. We’re releasing a new episode every Sunday morning.

IN THIS WEEK’S EPISODE- We looked at how Egyptian companies can identify and pitch foreign partners and how they can identify them. We asked how do companies figure out what they’re looking for — and whether that dovetails with what they want or need. We were joined on that panel by Hossam Abou Moussa, partner at PE firm Apis, Cheick-Oumar Sylla, director for North Africa and Horn of Africa at the International Finance Corporation, and Hassan Massoud, associate director and head of private equity (Southern Mediterranean) at the European Bank for Reconstruction and Development.

ENTERPRISE IS LOOKING FOR SMART, TALENTED PEOPLE of all backgrounds to help us build some very cool new things. Enterprise — the essential morning read on all the important news shaping business and the economy in Egypt and the region — is looking for writers, reporters and editors to help us build out new publications.

NEVER WORKED IN A NEWSROOM BEFORE? We have the Enterprise Business Writing Development Program. Whether you are a recent graduate, an industry vet, or looking to switch careers, the Enterprise Business Writing Development Program will give you the tools you need to tell the most important stories to our audience of C-suite officials, government ministers, diplomats, financiers, investors and entrepreneurs.

Not an internship program — a career: The three-month program will see full-time, paid participants take part in workshops and lectures from veteran business journalists, while also working on and filing stories that will run on any of our publications. Those who have successfully completed the program, will then be given long-term job offers.

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

Egyptian cabinet approves measures to attract FDI

FDI was the unofficial theme at yesterday’s cabinet meeting, with the Madbouly cabinet following up on several decisions aimed at improving the investment climate and boosting inflows, according to a statement.

Foreigners may soon be able to own more than two properties: Cabinet approved a decision lifting current controls on foreign ownership of real estate, provided that foreigners pay for their purchases in hard currency and via bank transfer to a state-owned bank. Under current rules, foreigners are allowed to purchase a maximum of two properties. This was one of 22 decisions introduced by the Supreme Investment Council (SIC) in its first meeting back in May in efforts to boost investment.

On a related note: Ministers approved two draft decisions allocating state owned land in New Cairo and Sixth of October to unnamed international real estate developers, to be paid for in USD. The government has been making it easier for foreign parties to buy land in hard currency as one way to address the ongoing FX shortage.

Foreign investors will also, for the first time, be allowed to register as importers with 10-year licenses, it seems, potentially making it easier for them to get goods and production inputs into the country without contracting with an Egyptian middleman.

The SIC’s long list of decisions is, inch by inch, becoming reality: The government has been working to deliver on each of the 22 decisions taken by the council. Most recently, House committees yesterday approved draft bills to expand investment incentives and reinstate taxes on state entities. We have the details in Legislation Watch, below.

ALSO APPROVED BY CABINET-

#1- A USD 733 mn loan from JICA: The cabinet approved a USD 733 mn loan from the Japanese International Corporation Agency (JICA) to finance the construction of Cairo Metro Line 4. The first, 19-km phase of the fourth line will connect Cairo, Giza and Sixth of October City. It is expected to take six years to complete. The second, 23.5-km phase, will connect to New Cairo.

#2- France’s Alstom plan to set up an industrial complex: Cabinet approved in principle a plan put forward by French manufacturer Alstom to establish an industrial complex in Alexandria’s Burj Al Arab. Alstom wants to establish two factories producing electrical and signaling systems and other parts for railways, metro lines, high-speed rails, and monorails.

Egypt’s House committees greenlight new investment incentives, removal of tax breaks for state entities

House committees approve bills aimed at boosting private-sector investment: The House Economic Affairs Committee yesterday approved amendments to the Investment Law aimed at expanding incentives, while the Budget and Planning Committee approved a draft bill reinstating taxes on state entities. Cabinet signed off on the two bills before the Eid Al Adha break.

The rationale: The bills aim to improve the investment climate, support private-sector participation, and promote fairness, competition, and transparency in the economy. They were among 22 moves to reform the business climate put forward by the Supreme Investment Council in its first ever meeting back in May.

Grandfathered incentives + more folks can apply for “golden” license: The Economic Affairs Committee approved amendments to the Investment Law that allow projects that predate the 2017 bill to benefit from its incentives and expand the variety of projects eligible for a single approval or ‘golden’ license. “The amendments aim to create a more attractive investment climate that can attract greater foreign inflows,” Asser Mounir, advisor to the General Authority for Freezones and Investment (GAFI), told MPs. “This is another step towards cutting red tape.”

Curbing tax perks for state entities: The Budget Committee greenlit a bill that eliminates preferential tax treatment for some state-owned entities. Among the tax breaks the bill will remove are customs and real estate tax exemptions, Bassam El Zayyat, advisor to the parliamentary affairs minister, told the committee. MP Ayman Mehasseb said the draft law “shows the state is serious about improving the investment climate and reinforcing transparency.”

What we know so far — and what we don’t: The bill is not set to impact companies that fall under international agreements, that are defense- or national-security-related, or basic infrastructure projects. We’re still waiting for the exact list of tax breaks it will remove and from which state entities, neither of which are specified in the bill. In other words: This is potentially a step in the right direction, folks, but the devil will be in the details. Watch this space.

This is part of our economic reform program: The government is aiming to increase exports to USD 100 bn a year by the middle of the decade, and attract USD 40 bn in private investment by 2026 as it looks to increase the private sector’s economic footprint. Improving the business climate is also a key condition of our stalled USD 3 bn loan program with the IMF.

What’s next? The two draft bills will be up for discussion and a vote when the House reconvene next week.

Scatec signs land deal for 5-GW wind farm in Egypt’s Sohag

Scatec yesterday signed a land allocation agreement with the Electricity Ministry for a planned 5-GW wind farm in Sohag governorate, cabinet said in a statement.

What we know: The USD 5 bn plant will create 8k jobs, 300 of which will be permanent once the plant is operational, according to the statement. The facility will be one of the largest in Africa, Scatec CEO Terje Pilskog said at the signing ceremony yesterday.

What we don’t: The statement didn’t disclose projected timelines for the project or provide clarity on the offtake agreement for the power the farm will generate.

This is the second COP27 wind MoU to move forward: Yesterday’s agreement comes nine months after the Norwegian renewables developer signed an MoU for the project with the Egyptian Electricity Transmission Company and the New and Renewable Energy Authority. A consortium consisting of Masdar, Infinity Power, and Hassan Allam Utilities inked last month a land-allocation agreement for a 10-GW wind plant, having also signed the original memorandum of understanding at COP27 in Sharm El Sheikh.

Sohag is emerging as one of the country’s future wind energy hubs: Both the Scatec and Masdar-led wind plants will be based in Sohag, putting a combined 15 GW of generation capacity in the governorate.

Both projects will be key to Egypt hitting its renewables targets: Egypt wants renewable energy to contribute 42% of the country’s total energy mix by 2030 and 60% by 2040.

Scatec is becoming a key player in the nation’s green energy infrastructure: The Norwegian developer is part of the consortium establishing Egypt’s first green hydrogen plant, and in recent months has signed early agreements to construct a USD 450 mn green methanol plant, a 1 mn ton-per-year green ammonia plant, and a 3-GW electricity link that would transport renewably-generated power from Egypt to Europe. It also operates six solar plants with a combined 380 MW of capacity at the Benban site near Aswan.

The story is getting plenty of airtime on state television, as we note in Last Night’s Talk Shows.

Egypt’s non-oil private sector activity contracts at weakest rate in 22 months in June

A brighter June for Egypt’s non-oil private sector: The contraction in Egypt’s non-oil private sector slowed to its softest pace in almost two years on the back of easing inflation pressures, according to S&P Global’s purchasing managers’ index (pdf). The country’s PMI rose for the third consecutive month to reach 49.1 in June, up from 47.8 in May. This is the highest reading since August 2021 — but still below the 50.0 mark that separates growth from contraction, making June the 31st consecutive month that business activity has been in decline.

Output + new orders drove the gentler contraction in June: “Behind June's sustained uplift in the PMI were output and new orders, which similarly showed rates of decline softening amid reports from some survey members that demand conditions were beginning to show green shoots of recovery,” said Joe Hayes, principal economist at S&P Global Market Intelligence. While non-oil private sector output continued to contract, driven by price pressures, liquidity challenges, and weak demand, it did so at its weakest rate in 21 months. New work intake similarly continued to fall as a result of high prices and subdued economic conditions but did so at its softest rate since December 2021.

Domestic demand lifted by easing inflation — but overseas orders fall sharply: Local clients drove purchasing orders in June as input cost inflation came in at a 16-month low driven by a slower uptick in purchase costs, allowing output charges to rise at a slightly weaker rate. However, new export orders fell at their sharpest rate in nine months.

REMEMBER- Annual inflation rose to 32.7% y-o-y in May and is expected to remain high following hikes to diesel and subsidized food prices. Capmas and the central bank should release June’s inflation figures on 10 July. The PMI inflation gauge measures businesses’ perception of how prices are changing, while Capmas calculates the official figure based on the price of a basket of goods and services.

Confidence is near an all-time low, despite softer contractions across the board: “Business confidence fell to its second-lowest level on record, highlighting a somber mood amongst businesses across Egypt's non-oil private economy,” said Hayes. “If key survey indicators such as output and new orders can sustain their upward current trajectory, we may see an improvement in business sentiment in the coming months,” he added.

FROM THE REGION-

Saudi expansion continues: Activity in Saudi Arabia’s private sector recorded sharp growth in June with the PMI (pdf) rising to 59.6 from 58.5 in May, as both output and new orders rose at accelerated rates. Employment remained high, with some firms increasing wages to maintain experienced staff.

UAE firms see new demand hit four-year high: The UAE’s PMI (pdf) rose to 56.9 in June from 55.5 the month before, as strengthening business conditions caused output and new orders in the country’s non-oil private sector to rise rapidly. New orders were supported by an increase in overseas demand.

Flexible exchange rate is key to Egypt getting out of the current bottleneck, IIF says

Egypt financial situation “precarious” -IIF: A slowdown in imports during the last fiscal year might have eased some of the external pressures we face, but Egypt’s finances remain in a “precarious” position amid uncertainty over the future of its loan program with the IMF. That’s according to analysts at the Institute of International Finance (IIF), who wrote in a note this week that adopting a flexible exchange rate will be key to resolving the imbalances and rebuilding reserves.

What’s the IIF, again? It styles itself as the global industry association for the finance industry and counts commercial and investment banks, asset managers, sovereign wealth funds, hedgies and central banks (among others) as members.

Multiple pressures: The postponement of the IMF program, high external debt levels, twin fiscal and current account deficits, a deteriorating net foreign asset position, and portfolio outflows are all putting pressure on the country’s finances.

Remember: The USD 3 bn IMF assistance program has been on hiatus since mid-March when the Fund postponed the first review due to the government’s lack of progress floating the currency and selling state-owned assets.

Import slowdown eases pressure: Import restrictions in place through most of 2022 together with the series of currency devaluations caused a “large contraction” in the volume of goods being brought into the country, easing pressure on the country’s balance of payments. This helped the country generate its first current account surplus in almost nine years in 2Q FY2022-2023 and the IIF expects the deficit to have narrowed to 1.1% of GDP over the course of the fiscal year, from 3.5% in FY 2021-2022.

FDI rebound: The IIF expects a “large increase” in foreign direct investment in FY 2023-2024 which will be key to financing the deficit in the absence of portfolio inflows.

But vulnerabilities remain:“Egypt remains extremely vulnerable to external factors as well as to domestic structural bottlenecks,” the analysts wrote. Expectations for slower global growth this year could dent revenues from exports, tourism, and the Suez Canal, while a recovery of imports would cause the trade balance to “quickly deteriorate.” The IIF expects these factors could cause the current account deficit to widen to around 1.7% of GDP this year.

A flexible currency is key: Adopting a fully flexible exchange rate and eliminating the parallel market is one of the adjustments policymakers will need to make to rebuild reserves, according to the report. “An additional devaluation could lower the trade deficit, constraining imports while boosting non-hydrocarbon exports, while also allowing remittances to recover to FY22 levels as the parallel and official rates converge, lowering financing needs,” the analysts wrote.

Sidpec approves fair value studies ahead of Ethydco merger

Sidpec, Ethydco valuations out ahead of potential merger: Sidi Kerir Petrochemicals (Sidpec) board has approved Baker Tilly’s valuations ahead of a potential all-share merger with the Egyptian Ethylene and Derivatives Company (Ethydco), the company said in an EGX disclosure (pdf) yesterday. The accounting firm’s assessments peg Ethydco’s valuation at EGP 33.5 bn (around EGP 2,420.09 per share) and Sidpec’s at c.EGP 23.1 bn (around EGP 30.60 / share).

Sidpec shares undervalued on the EGX? The company’s shares closed up 4.0% at EGP 23.81 apiece yesterday — still more than 20% below Baker Tilly’s valuation.

Remember: EGX-listed Sidpec, which currently owns 20% of Ethydco, has been in the process of acquiring the remaining shares in the company since last year. The firm was said in March to have completed due diligence. It remains unclear how much it plans to offer to acquire the company.

Ethydco has been earmarked for privatization: The companywas among the 32 names flagged for privatization by the government for privatization earlier this year. Gulf investors have expressed interest in acquiring stakes in the merged entity, according to one local media report, while anothersays Sidpec could IPO Ethydco in a 10% stake sale via the EGX.

Advisors: NI Capital is advising Ethydco on the acquisition.

Hassan Allam, OC take home gongs from industry show

Our friends at Hassan Allam Construction and Orascom Construction have taken home awards from industry conference and expo Big 5 Construct Egypt. Among the awards of note across 21 categories:

Contractor of the year: Hassan Allam Construction
Partnership of the year: Metito, Orascom Construction, Arab Contractors and Hassan Allam Construction for the New Delta wastewater treatment plant.
Construction professional of the year: Hassan Allam Holding’s Mennatullah Mohamed AbdelGawad
Director of the year: Concord’s Saad Zaghloul
Developer of the year: Al Futtaim Group Real Estate

Talk shows cover the latest on investment, wildcat building from House of Representatives

It was a Sherif Amer-heavy night on the airwaves: Yahduth Fi Masr’s Sherif Amer dominated the airwaves last night, covering investment incentives making their way through the House and the draft law on reconciling the status of wildcat buildings.

Where is the new wildcat building law? A heavily-awaited law that would allow more illegal properties to go legit is being held up as the government awaits the data needed to draft its executive regulations, MP Ihab Mansour told Amer (watch, runtime: 9:32). The draft law would allow more owners of illegal buildings to pay “reconciliation fees” to legalize their status. It was approved by the cabinetlate last year.

Leveling the playing field? Amer also noted the House Planning and Budget Committee’s approval yesterday of a bill that would eliminate special tax treatment for some state-owned entities. “We are working towards fairness and equality … this comes under the economic reforms program that is part of the [USD 3 bn] IMF agreement,” committee chair Fakhry El Fiqi told Amer (watch, runtime: 6:21). We have all the details in Legislation Watch, above.

When can we expect the Scatec 5-GW wind farm to start operations? The USD 5 bn, 5-GW wind farm in Sohag is expected to be fully operational in six to seven years, with construction to start in two years, New and Renewable Energy Authority head Mohamed El Khayat told Al Hayah Al Youm (watch, runtime: 9:39). We have the full story in our Energy sectionl, above.

FACT CHECK- The cabinet has denied rumors circulating about the Customs Authority banning the import of a list of goods for a three-month period. Amer walked his viewers through ways to identify a fake Official Gazette document (watch, runtime: 5:58).

A calm morning for Egypt in the foreign press

Purely PMI in the foreign press: The sole mention Egypt got in the foreign press this morning came from Reuterstaking note of our June purchasing managers’ index (PMI) reading. We have the full rundown on that story in Economy, above.

Hilton to manage and operate two new hotels in Cairo. PLUS: Fintech BKN301 enters Egypt

HOSPITALITY-

Hilton to manage two new hotels in Cairo: Real estate developer CityEdgeyesterday signed a partnership contract on behalf of the Housing Ministry with Hilton that will see the global hotel operator manage two new hotels in Cairo’s Maspero and Magra El Oyoun, according to a cabinet statement. The hotels, which will be built in areas that were previously registered as unsafe, are part of the government’s efforts to redevelop areas of the capital.

More on the hotels: The DoubleTree hotel, which will be located in the Maspero Triangle Towers, will house 260 rooms and is scheduled to open in June 2028. Meanwhile, Hilton Magra El Oyoun will open at the end of 2026 with 218 rooms alongside a number of amenities, including halls, restaurants, a gym, spa, and swimming pool.

ICYMI- Hilton plans to nearly double the portfolio of properties it operates in Egypt over the next 3-5 years to reach 27 from a current 14, JJ Sleiffer, company president for the Middle East, Africa and Turkey, told Enterprise in March.

FINTECH-

Fintech platform BKN301 enters Egypt: San Marino-headquartered fintech startup BKN301 has entered the local market, launching its first office in Cairo, it said in a press release. BKN301 allows B2B clients to integrate fintech solutions into their operations and offers a variety of payment solutions.

UAE firms form MENA’s biggest property, FM platform

Aldar Estates will become the MENA region’s biggest property and facilities management platform afterEmirati real estate giant Aldar Properties, International Holding Company (IHC), and ADQ subsidiary ADNEC Group said they will merge their businesses within the Aldar Estates platform, according to a joint press release (pdf). Property and facilities management company Eltizam Asset Management Group — jointly owned by IHC and ADNEC — will join the platform, in which Aldar will retain majority ownership with the remaining shareholding split equally between IHC and ADNEC. The merger will expand Aldar Estate’s portfolio of residential units under management to 135k from 77k currently.

What does this mean for Aldar’s Egypt portfolio?Aldar is a majority shareholder in upmarket real estate developer SODIC, after it teamed up with ADQ to acquire 85.5% of the companyin 2021. Eltizam also has an Egypt-based portfolio after it created Tafawuq Egypt and Three60 Egypt in February 2021 alongside Al Ahly Sabbour. The press release did not detail if any properties and FM services under SODIC or Eltizam’s Egypt-based companies will also be transferred to Aldar Estates.

ALSO WORTH NOTING-

More downbeat economic data for China: China’s services PMI slowed down to 53.9 in June from 57.1 in May, recording the lowest reading since a COVID-19 wave in January. (Caixin/S&P Global, pdf))
Eurozone business activity slipped into contraction for the first time since December, registering 49.9 from May’s 52.8 as the services sector slumped and manufacturing output continued to decline. (S&P Global, pdf)
Bahrain-based asset manager Investcorp could next week start meeting with investors to gauge interest as it looks to execute the USD 600 mn IPO of its investment vehicle Investcorp Capital as soon as September. (Bloomberg)
Saudi football wants investment: The Saudi Pro League is discussing new broadcast agreements and partnerships with foreign private equity firms in a bid to bolster the appeal of its football competition. (Bloomberg)
MBC IPO? Middle Eastern broadcaster MBC Group will start meeting with investors as soon as next week as it works towards its Tadawul debut. (Bloomberg)

EGX30	17,380	-0.5% (YTD: +19.1%)
USD (CBE)	Buy 30.84	Sell 30.96
USD at CIB	Buy 30.85	Sell 30.95
Interest rates CBE	18.25% deposit	19.25% lending
Tadawul	11,592	-0.2% (YTD: +10.6%)
ADX	9,619	+0.4% (YTD: -5.8%)
DFM	3,924	-0.2% (YTD: +17.6%)
S&P 500	4,447	-0.2% (YTD: +15.8%)
FTSE 100	7,442	-1.0% (YTD: -0.1%)
Euro Stoxx 50	4,351	-0.9% (YTD: +14.7%)
Brent crude	USD 76.54	+0.4%
Natural gas (Nymex)	USD 2.66	-1.9%
Gold	USD 1,927.10	-0.1%
BTC	USD 30,447	-1.1% (YTD: +84.3%)

THE CLOSING BELL-

The EGX30 fell 0.5% at yesterday’s close on turnover of EGP 1.57 bn (about 28% below the trailing 90-day average). Local investors were net buyers. The index is up 19.1% YTD.

In the green: Egypt-Kuwait Holding (+4.3%), Sidi Kerir Petrochemicals (+4.0%) and Orascom Construction (+3.2%).

In the red: Eastern Tobacco(-4.3%), Telecom Egypt (-3.0%) and Ibnsina Pharma (-2.7%).

Asian markets are in the red across the board in early trading this morning after the US Fed’s latest meeting minutes hinted at more rate hikes to come. Futures suggest a similarly bearish open for European and US markets later on in the day.

Egypt reportedly offers to host talks between Palestinian factions after Jenin attack

Egypt to host Palestinian talks? The government has invited the heads of various Palestinian factions to a meeting in Cairo to discuss recent developments in the occupied territories and Israel’sviolent raidon the Jenin refugee camp in the West Bank, Al Arabiyareports. The death toll of the attack launched on Monday — Israel’s largest military incursion into the West Bank in almost two decades — has risen to 12 Palestinians and one Israeli soldier.

My Morning Routine: Tarek Seif El Nasr, head of venture growth, Falak Startups

Tarek Seif El Nasr, head of venture growth at Falak Startups: 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 Tarek Seif El Nasr (LinkedIn). Edited excerpts from our conversation:

My name is Tarek Seif El Nasr. I’m the head of venture growth at Falak Startups, where we focus on identifying promising early-stage startups, investing in them, and providing the support to help them scale and prosper. In my role, I act as an ambassador for our early-stage startups, striving to uncover the right partnerships and synergies that will foster their growth and progress. There's something incredibly rewarding about being able to support entrepreneurs and see these brilliant ideas turn into thriving businesses.

My upbringing was unique. As a diplomat’s son, I was privileged to be exposed to a wide array of cultures. This fostered a mindset of diversity and inclusivity in me, making connecting with people one of my biggest passions.

Falak started from a genuine desire to make a difference in the startup ecosystem. Our mission at Falak began as part of a government initiative. Our journey started with an Egypt-wide bus tour to connect with entrepreneurs. This evolved into several rounds of investments and support programs, culminating in a vast portfolio of innovative solutions that enable access to essential services like finance, healthcare, and education.

Falak is striving to solve a critical issue many entrepreneurs and startups face: securing the right resources to thrive. This includes not only identifying the appropriate talent to drive innovation but also establishing efficient distribution channels for market penetration. We recognize that access to capital is often a bottleneck for many promising startups. Our solutions help startups and entrepreneurs focus on what they do best — creating value and disrupting markets.

We're keen on partnerships with others who share our vision to provide resources and financial support for startups. One such example is our capacity-building program for VC investors in partnership with Strategy Tools and the European Bank for Reconstruction and Development. We're planning more initiatives to guide investors in this emerging field.

I try to stay focused by working with entrepreneurs who truly inspire me. Their passion, resilience, and innovative thinking motivate me to stay engaged and committed to our shared goals. Seeing their dedication to turning ideas into successful businesses helps me maintain my focus even when challenges arise. It's a constant reminder of why I do what I do.

The most exciting trend in our industry right now is the proliferation of AI. AI is no longer just a buzzword — it's becoming a crucial part of how companies operate and grow, and it’s driving operational efficiency like never before. It’s also helping businesses to predict customer behavior, personalize experiences, and make more informed strategic decisions. We’re only just scratching the surface with AI.

I love getting an early start in the morning with a bit of physical activity. Nothing wakes me up quite like a good run and a bit of a workout. I play tennis in the morning whenever I can. I also love word games like crosswords and Wordle — they're a fun challenge that gets me thinking and helps sharpen my focus. I also read Enterprise, which is my go-to source for keeping up-to-date on industry happenings.

There is no normal work day in the startup world. The best part about working in this environment is that every day is different. We’re meeting with and supporting startups, understanding their specific challenges, finding ways to assist them, and connecting them with potential investors.

At the end of each day, I make it a habit to unwind. I immerse myself in a new TV series, reading, or playing card games with friends. Time management plays a crucial role in achieving this balance — I list my priorities and try to avoid procrastination.

My favorite TV series is Succession, which I just finished. It’s quite the masterpiece in terms of storyline and character development, and it gives a fascinating look into the dynamics within a powerful, family-run corporation. I also enjoyed the movie Air, a gripping account of Nike's journey to signing Michael Jordan and the creation of the now iconic Air Jordan brand. As someone whose favorite book is Shoe Dog — a memoir by Nike's founder Phil Knight — Air was a thrilling visual complement that offered a behind-the-scenes look into the world of sports marketing and brand building.

One of the best pieces of advice I've received came from my father, a true embodiment of hard work. He told me not to leave anything to chance. These words deeply resonated with me, encouraging me to harness the power of preparation and proactive effort. Having this mindset truly sets you up for success.

CALENDAR

JULY

12-13 July (Wednesday-Thursday): Finance Ministry to pay out first batch of export subsidies under sixth phase of subsidies program.

15 July (Saturday): Deadline for EGAS + EGPC bid rounds for gas exploration and development of mature oil fields.

15 July (Saturday): Rollout of the fourth phase of the Egyptian Tax Authority’s e-receipt system.

18 July (Tuesday): Islamic New Year.

18-19 July (Tuesday-Wednesday): Egypt Mining Forum, Nile Ritz-Carlton, Cairo.

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

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

23 July (Sunday): Revolution Day.

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

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

31 July (Monday): Application deadline for the Smart Green Projects initiative.

31 July (Monday): Emigration Ministry’s Egyptians Abroad conference.

Late July-14 August: 2Q2023 earnings season.

AUGUST

August: Hassan Allam Utilities + Agility to open Yanmu East logistics park.

2 - 3 August (Wednesday - Thursday): Gov’t to pay out subsidies to second wave of applicants under its sixth export subsidy program.

3 August (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

10 August (Thursday): Shalateen Mineral Resources gold mining tender closes.

22-24 August (Tuesday-Thursday): BRICS summit, Johannesburg, South Africa.

SEPTEMBER

September: Sustainable Debt Coalition Initiative agreed at COP27 to launch.

September: IDH to open first branch in Saudi Arabia.

September: The Egypt-Germany trade and investment joint conference in Cairo.

September: JETRO’s second delegation arrives in Cairo.

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

10-12 September (Sunday-Tuesday): The International Agricultural Exhibition for Africa and the Middle East, Sahara.

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

15 September (Friday): Deadline for FX bureaus to comply with new capital requirements.

17-18 September (Sunday-Monday): Arab Security Conference and Exhibition, Nile Ritz Carlton.

17-19 September (Sunday-Tuesday): Sharm Rendezvous, Rixos Premium Seagate, Sharm ElSheikh.

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

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

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

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

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

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

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

28-29 September (Thursday-Friday) Medical Tourism Conference, Sharm ElSheikh.

OCTOBER

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

2-4 October (Monday-Wednesday): Sharm Rendezvous - Ins. Market, Rixos Premium Seagate, Sharm ElSheikh.

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

6 October (Friday): Armed Forces Day.

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

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.

NOVEMBER

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

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.

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

DECEMBER

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.

EVENTS WITH NO SET DATE

2023: The inauguration of the Grand Egyptian Museum.

Summer 2023: EGX to launch a shariah-compliant index.

1H 2023: GAFI roadshow set to launch to drum up foreign investment for golden licenses

1H 2023: Abu Dhabi Islamic Bank intends to launch a digital consumer finance company

2H 2023: Egyptian government expected to sign agreements with a consultant for the EuroAfrica electricity interconnector.

2H 2023: President Abdel Fattah El Sisi and Turkish President Recep Tayyip Erdogan expected to hold a summit.

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

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

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

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

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

2Q 2025: Safaga Terminal 2 to initiate operations.

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