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Tuesday, 17 Feb 2026

What We’re Tracking Today
The Big Story Today
Development Finance
A Message From Visa
Hospitality
Marketing
Also On Our Radar
Planet Finance
Going Green
Calendar

Why Bonyan is wagering on a 4.5 mn sqm shortfall in premium Egyptian office space

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Today at a glance

1

The Big Story Today

Why Bonyan is wagering on a 4.5 mn sqm shortfall in premium Egyptian office space.
2

Development finance

IFC expands climate and SME financing in Egypt and East Africa.
3

MARKETING

Egypt’s billboard market is getting more expensive rather than significantly bigger.
4

ALSO ON OUR RADAR

Banknbox and ASD Smart aim to bridge Sudan’s isolated banking apps by 2026.
5

WHAT WE’RE TRACKING TODAY

The government is wagering that a no-blackout summer is worth the sizable hit to the deficit.
6

ALSO ON OUR RADAR

Does the localized data center assembly push signal a new data residency sensitivity?
7

PLANET FINANCE

Markets caught between AI hype and AI fear.
8

Going Green

Egypt’s wind localization bid is anything but a breeze.

Tuesday, 17 Feb 2026

What We’re Tracking Today
The Big Story Today
Development Finance
A Message From Visa
Hospitality
Marketing
Also On Our Radar
Planet Finance
Going Green
Calendar
1

WHAT WE’RE TRACKING TODAY

The government is wagering that a no-blackout summer is worth the sizable deficit hit

Good morning, friends. It looks like winter is here to stay after last night’s heavy rainfall, which took us by surprise and gave us reason to keep our coats and umbrellas at hand for just a little bit longer.

Make sure to head out the door a little earlier than usual this morning, as we suspect that (in typical Cairo fashion) some roads will be flooded, resulting in some early-morning traffic jams.

In today’s issue, we’re looking at a series of calculated wagers across the Egyptian economy. The most significant is a USD 11 bn LNG import plan — the government’s way of placing its chips on the belief that social stability and a predictable operating environment are worth a massive hit to the deficit.

Over in the private sector, while some parts of the real estate market may be showing signs of a supply glut, Bonyan thinks the smart money is hiding in the grade A office market and is seeing success on this front with a new lease to Nestlé.

We’re also tracking a shift toward industrial sovereignty, from the localized assembly of data centers (which hints at tightening data residency rules) to the ambitious attempt to manufacture wind turbines at home.

***

WISH THIS MORNING’S ISSUE was a podcast? We’ve got you. Tap or click here to listen to Morning Drive, a 10-minute version of today’s issue crafted for you to enjoy with your morning coffee, while getting the kids ready for school, or while stomping around the house wondering where the [redacted] you left your [redacted] reading glasses.
***

Watch this space

ENERGY — The government is wagering that a no-blackout summer is worth a sizable deficit hit, with the country looking to secure USD 11 bn in LNG across 130 shipments starting June while also ruling out any electricity price hikes until then, two government officials tell EnterpriseAM. In the current climate, it seems the state thinks that a predictable operating environment and social stability are more important than the need to continue clamping down on energy spending.

The news also illustrates continuity in the state’s approach to its LNG needs, as the planned shipments will stem from the renewal of expiring supply agreements with Saudi Aramco, Trafigura, Vitol, Hartree Partners, and BGN, a government source in the oil sector tells us. The contracts will also allow cargoes to be deferred if demand softens — a pressure valve we leaned on last year too — while foreign companies will have to prioritize domestic demand starting April.

News that electricity price hikes won’t come before the new fiscal year is no surprise, with government sources having previously communicated the same plan to us. Electricity tariffs have been frozen since the last adjustment in August 2024, and the policy could expand further with the approval of the new budget, we’re told.

Progress toward long-term energy independence will also support the state in keeping its commitment to have no power outages despite an expected demand rise of 6-7% in the hotter months of the year, a senior government source tells us. The official described a multi-pronged approach that will lean on boosting domestic fossil fuel production and building up renewable capacity.

LOGISTICS — The government is exploring establishing a joint shipping route with Kenya, linking Egyptian Red Sea ports with Kenyan ports on the Indian Ocean, Foreign Minister Badr Abdelatty told his Kenyan counterpart during his time in Nairobi. A joint shipping route will give Egypt an anchor in an East African logistics center, as well as strengthen maritime security in the area.

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** DID YOU KNOW that we cover Saudi Arabia, the UAE, and the MENA-IndiaCorridor?** 

Data point

99 — that’s the number of companies that applied for a Startup ID in the first seven days since the government launched the Startup Charter, according to a statement from the Micro, Small, and Medium Enterprises Development Agency.

PSA-

Ramadan hours will kick in starting tomorrow, with retail shops, malls, restaurants, and cafés permitted to remain open until 2am daily throughout the holy month and Eid Al Fitr holiday, according to a Local Development Ministry statement. Workshops in residential areas will have a closing time of 10pm, while food delivery services, supermarkets, bakeries, grocery shops, and pharmacies will have no restrictions.

WEATHER- Our brief moment of summery weather will come to a close in Cairo today, with temperatures dropping to a high of 24°C and a low of 13°C, according to our favorite weather app.

Over in Alexandria, temperatures will reach a high of 23°C and a low of 13°C.

The big story abroad

It’s an oddly calm morning in the global press, with headlines continuing to follow the tech selloff. Technology stocks are seeing hundreds of bns in losses amid a reality check over exorbitant AI spending and murky earnings visibility, with investors pulling back from equities of Big Tech giants. Microsoft’s market value saw the biggest dip compared to its peers, shedding some 17% YTD. Amazon, Nvidia, and Apple also saw their market value slip over the past month and a half. Meanwhile, more conventional equities — like Samsung and Walmart — have seen growth in their market value over the same period.

For a deeper dive into the market’s responses to AI, check out this morning’s Planet Finance, below.

And in the latest sign that 2026 is just not the greenback’s year: Fund managers are morepessimistic about the USD than at any point in the last ten years, following its 1.3% drop against a basket of other currencies in 2026. Confidence in US assets is waning, and the currency is still vulnerable to further losses, experts at asset management players said.

*** It’s Going Green day — your weekly briefing of all things green in Egypt: EnterpriseAM’s green economy vertical focuses each Tuesday on the business of renewable energy and sustainable practices in Egypt, everything from solar and wind energy through to water, waste management, sustainable building practices, and how you can make your business greener, whatever the sector.

In today’s issue: We take a look at how Egypt is turning to wind power as the next frontier in its clean energy localization push, following earlier steps to manufacture solar components and batteries here in Egypt.

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Where the sea meets the saddle. The wait is over. The stage is revealed.

Egypt Equestrian Cup 2026. 📍Somabay. March 26 — 27 — 28

Three days of mastery. One arena. Countless legacies in motion.

2

The Big Story Today

Why Bonyan is betting on a 4.5 mn sqm shortfall in premium Egyptian office space

While some parts of the real estate market may be showing signs of a supply glut, Bonyan thinks the smart money is hiding in the grade A office market. Bonyan will hand the keys of its Golden Gate Building A5 in New Cairo to Nestlé Egypt in a six-year lease agreement starting next month, according to a statement (pdf) from the real estate operating company. The 6.9k sqm building will house the headquarters of Nestlé Business Services, the Swiss giant’s service arm.

Calculated timing: The monthly rental stands at USD 30.4 per sqm, with a 5% annual escalation, projecting EGP 834 mn in revenues over the contract period. This effectively recovers the full EGP 718 mn Bonyan paid to acquire the asset in 2024 while it was still under construction, CFO Fady Raafat tells EnterpriseAM, referring to the company’s portfolio engineering.

Why Egypt? The EGP devaluation has made the country a cost-efficient hub for global shared services operations serving Europe, Asia, and Africa. Egypt’s geography helps, as does its talent pool.

And why Bonyan? Nestlé chose Bonyan because it prefers dealing with institutional entities rather than individual owners, coupled with a strong existing relationship across other Bonyan properties, Raafat said.

Bonyan runs a deliberate currency split, where 54% of its contracts are USD-denominated, without caps or floors, allowing revenues to scale directly with exchange movements. The remaining 46% are in EGP, capturing higher annual escalation rates. Raafat explained that this balance aims to hedge against future devaluations, balancing protection with upside.

Why this matters: Egypt faces a projected shortfall of 4.5 mn sqm in grade A office space by 2028. Most of the supply is chopped into small units, whereas multinationals demand contiguous, 7k-12k sqm floors under one roof, Raafat argues. And they want them leased, not owned, following a doctrine of keeping asset-light — and falling interest rates won’t suddenly make corporations rush into property ownership, he noted.

What about the real estate bubble narrative? Raafat draws a clear line: while residential may face oversupply and weakened purchasing power, administrative and commercial real estate remain shielded by genuine demand and structural shortages.

Bonyan sees 2026 as an inflection point, expecting further interest cuts to lower financing costs and open the door for more leveraged acquisitions. The firm is also studying a move into warehousing and logistics — another segment where supply lags real demand — with its first agreement potentially closing this year.

Sustainability is no longer branding — it’s compliance. Edge certification has shifted from optional to contractual for global tenants, aligning with international ESG standards. If you don’t build to spec, you don’t get the tenant.

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3

Development finance

IFC expands climate and SME financing in Egypt and East Africa

The International Finance Corporation (IFC) is putting USD 208 mn to work across Egypt and East Africa, targeting engines of everyday economic life, including banks that lend to small businesses, companies that manufacture medical equipment, and platforms that move food from suppliers to consumers, it said in a statement seen by EnterpriseAM.

Here’s how the capital is being deployed:

  • USD 150 mn to Banque Misr to expand lending for renewable energy, green buildings, sustainable transport, and energy efficiency. Part of the facility will go to MSMEs, with 20% earmarked for women-owned businesses;
  • USD 30 mn to GlobalCorp Group to scale leasing and factoring for MSMEs, particularly in underserved communities. This is the IFC’s first local-currency securitization in Egypt and the first development finance institution investment in a leasing securitization market;
  • USD 15 mn to GMED Holding and its subsidiary EGMED to scale medical equipment production, expand healthcare access, and roll out specialized training programs to strengthen local supply chains;
  • USD 13 mn to Breadfast to grow logistics, manufacturing, and tech capabilities to improve food distribution, widen SME retail access, and create jobs;
  • Advisory support to the Export Development Bank of Egypt to upgrade climate reporting and data governance under the Egypt30by30 program to help scale green lending.

Why this matters: The package adds to nearly USD 10 bn of IFC investment in the country to date and shows how it is moving further downstream to tackle the specific bottlenecks in the economy. For instance, anchoring the GlobalCorp securitization in local currency creates a proof of concept for non-bank financial institutions to access debt markets directly. The backing of Breadfast and GMED reflects a clear preference for real-economy vertical integration — investing in businesses that control more of their supply chains and can expand production, distribution, and resilience from within.

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4

A MESSAGE FROM VISA

Egypt as the regional architect: building the MENA fintech hub through regulatory collaboration

In the history of economic development, national progress was often measured by the reach of transport and energy networks. Today, in Egypt, the most critical architecture is invisible. The strategic priority is to treat regulatory frameworks as national infrastructure. Just as highways facilitate the flow of goods, a robust Fintech Sandbox and E-KYC protocols form the digital rails that determine the velocity, safety, and scale of modern commerce.

To lead a region, a nation must offer more than market size; it is also critical to offer a frictionless, trusted environment where ideas can accelerate safely. This is the core utility of the fintech sandbox: a controlled laboratory where the state can stress-test emerging tools, from AI-lending models to tokenized payments, ensuring that systemic safeguards exist before mass adoption.

Simultaneously, E-KYC becomes the universal on-ramp, eliminating physical and geographical barriers that have kept mns outside the formal economy. By institutionalizing these digital utilities, Egypt shifts from being a consumer of global trends to a setter of regional standards.

This evolution is best realized through a structured pilot partnership model, where Visa serves as a strategic bridge to global expertise. By sharing international best practices and technical benchmarks, Visa can help de-risk innovation and enable policymakers to validate emerging tools with real market data before full legislation.

The result is a high-fidelity feedback loop, where private-sector success informs agile governance. Through this alignment of public oversight and Visa’s global scale, Egypt is not just participating in the region’s fintech future; it is engineering the foundation on which it will be built.

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5

HOSPITALITY

TMG taps Mandarin Oriental to operate Old Cataract and Winter Palace

Talaat Moustafa Group (TMG) is handing over the operations of two of its landmark heritage hotels to Mandarin Oriental, the real estate and hospitality giant said in a statement (pdf). Under the agreement, the Hong Kong–based global luxury hotel operator will take over the operations of the Old Cataract Aswan and the Winter Palace Luxor and relaunch them under the Mandarin banner in July 2027.

Wasting no time: The hotel operator will assume management of Old Cataract in May, before beginning its extensive renovation of the property. Meanwhile, Winter Palace will undergo complete restoration before its relaunch.

The move follows TMG’s 2024 acquisition, through its hospitality arm Icon, of a 51% stake in the seven-hotel Legacy portfolio in a USD 800 mn transaction. The transaction expanded TMG’s footprint across Cairo, Giza, Alexandria, Luxor, and Aswan. “By combining Mandarin Oriental’s legendary service standards with TMG’s long-term investment vision and local expertise, we are elevating these historic assets into world-class luxury destinations and reinforcing our position as a leading hospitality platform in Egypt,” TMG CEO Hisham Talaat Moustafa said in the statement.

TMG is doubling down on tourism: Hospitality and recurring income streams now account for more than half of the consolidated EBITDA of the country’s largest real estate developer, according to the statement. Its hotel room capacity is projected to reach roughly 5k rooms, up from about 3.5k today. The group owns several Four Seasons properties in Cairo, Alexandria, and Sharm El Sheikh. It is also developing Four Seasons Luxor, Four Seasons Madinaty, a resort in Marsa Alam, and a Four Seasons hotel adjacent to the Grand Egyptian Museum.

IN CONTEXT- Egypt welcomed around 19 mn tourists in 2025, marking a 21% y-o-y increase, and is targeting 21 mn visitors in 2026, then 30 mn visitors in 2030, as air connectivity improves and new hotel capacity comes online.

Going big on Egypt: “Egypt is one of the fastest growing global destinations and presents a rare [window] to create a journey that is both culturally rich and uniquely Mandarin Oriental,” Mandarin’s CEO Laurent Klietman said in a separate statement. In addition to its partnership with TMG, Mandarin is preparing to reopen Shepheard Hotel in Cairo in 2027 under the agreement it signed with Saudi Arabia’s Al Sharif Group in 2022. It is also set to operate its first river luxury cruise between Luxor and Aswan following its recent agreement with Garranah Group. Mandarin currently operates a luxury portfolio of 45 hotels, 15 residences, and 36 exceptional homes in 28 countries and territories.

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6

MARKETING

Egypt’s billboard market is getting more expensive rather than significantly bigger

Egyptian businesses invested EGP 12.7 bn in out-of-home (OOH) advertising in 2025, a 60% jump from the year before, according to outdoor ad aggregator AdMazad’s latest annual report (pdf). The surge was largely price-led, driven by high occupancy rates and rising licensing costs, AdMazad co-founder and Managing Director Assem Memon tells EnterpriseAM. Average billboard utilization rates hit 86%, with the Ring Road at 95% occupancy.

Inventory growth remained measured, with 900 new billboards added in 2025 (+9% y-o-y), mainly across high-growth corridors like New Cairo and Sheikh Zayed. Of these, 115 were digital-out-of-home (DOOH) screens, signaling a steady — if cautious — shift toward digital formats.

Real estate dominates, DOOH drives revenues

Real estate tightens its grip — for now. Real estate developers once again dominated the market, accounting for 65% of total OOH spend during the year and growing 72% y-o-y. While 15 of the year’s top 20 advertisers were in real estate, the sector’s shares had eased to 54% by year-end, raising questions about overreliance on a single growth engine. The report flags the need for media owners to widen their client base and hedge against any slowdown in the property market.

Digital screens generated 19% of total revenues despite representing just 5% of locations, making them the market’s highest-yield segment. Yet their rapid spread has stirred concerns over brightness and light pollution. Memon says the answer lies in adopting night-specific creatives and programmatic buying to reduce waste and overexposure. The industry still leans heavily on auto-dimming technology, but smarter content strategies could preserve visibility without overwhelming the public.

Advertisers push beyond traditional hot spots

While real estate brands continue to dominate premium districts such as New Cairo and Sheikh Zayed, where they account for more than 80% of spending, volume-driven sectors are expanding elsewhere, Memon tells us. The Delta and Upper Egypt are proving key battlegrounds for healthcare, telecom, and FMCG players, where lower ad rates and dense traffic translate into attractive returns.

The data points to a shifting pecking order in secondary cities. Mansoura and Zagazig are now outperforming Tanta for non-real estate advertisers, buoyed by stronger purchasing power and growing appetite for diverse brands.

Seasonal destinations are also shifting. OOH spending extended further along the North Coast, even beyond Ras El Hekma, though the area remains largely summer-driven, Memon argues. He added that Ras El Hekma reflects long-term brand positioning, while Sidi Abdelrahman continues to deliver the bulk of immediate consumer exposure. By contrast, Red Sea’s El Gouna has secured year-round visibility.

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7

ALSO ON OUR RADAR

Banknbox and ASD Smart aim to bridge Sudan’s isolated banking apps by 2026

Bankbox looks at a shared infrastructure layer to fix Sudanese fintech fragmentation

Egyptian fintech Banknbox is moving to solve one of the Sudanese financial sector’s most persistent headaches: fragmentation. Under a new strategic agreement with local partner ASD Smart, Banknbox will launch an interoperable instant payment platform designed to link Sudan’s isolated set of banking apps and mobile wallets by the end of 2026, according to a statement (pdf) from the company.

For a country grappling with physical currency shortages and infrastructure instability, Banknbox had to think out of the box. To address Sudan’s electricity and telecommunications outages, the company has designed a distributed cloud architecture. This ensures that transactions are neither lost nor duplicated during disruptions, CEO Bassem Mahmoud tells EnterpriseAM.

Rather than competing with popular existing Sudanese apps like Bankak, the platform will serve as a “shared infrastructure layer” that enables interoperability between different e-wallets and banks for the first time on a broad market scale, Mahmoud tells us. He added that BanknBox will adopt a hybrid business model — combining licensing fees with transaction-based fees — ensuring sustainable revenue as digital transaction volumes grow nationwide.

Does the localized data center assembly push signal a new data residency sensitivity?

Schneider Electric, local systems integrator Zerotech, and the Arab Organization for Industrialization (AOI) inked an agreement to locally assemble data center units at one of AOI’s factories, according to a Zerotech statement seen by EnterpriseAM. The project will “meet the growing needs of national projects” and “aims to enhance the Egyptian market’s readiness for expanding data center solutions and accelerating Egypt’s digital transformation,” Zerotech Chairman Atef Abu Hashem said.

Why this matters: This move could be in anticipation of a stricter regulatory environment for data residency as regulators become increasingly focused on where and how data is stored. Using infrastructure that is locally assembled in a facility with ties to the nation’s security apparatus provides an extra layer of sovereignty for sensitive sectors like defense, telecommunications, and finance.

Mubadala and SBI back Breadfast plan to explore African logistics expansion

Breadfast raised USD 50 mn in a pre-Series C funding round supported by Emirati sovereign wealth fund Mubadala, Japan’s SBI, and Saudi’s Olayan Financing Company, alongside unspecified VC investors, institutional investors, and an unnamed Saudi family, according to a statement. The online grocery company will use the funds to “expand infrastructure, strengthen logistics, and explore entry into new African markets.”

Why it matters: For most local startups, expansion ambitions seem to start and end in the Gulf. Yet Breadfast, along with a few notable exceptions, is also looking south and west into Africa. The company could be wagering that the full-stack approach it honed in Cairo may be a better fit for other markets on the continent than the already oversaturated Gulf market.

What’s next? The Cairo-born startup is looking to launch a larger Series C round in the first half of the year.

Valu rolls out high-ticket instant financing starting at EGP 1 mn

Valu launched an instant financing service for high-ticket transactions starting from EGP 1 mn, allowing users to apply through its app using only the national ID, the fintech giant said in a statement (pdf). Through the new service, Valu aims to broaden access to credit to include self-employed and underserved segments whose income structures or business models do not align with the standard documentation requirements typically imposed by traditional banks.

Leveraging big data: Valu has succeeded in integrating income assessment criteria, proactive risk evaluation, down payment determination, and risk-based pricing into a single operating workflow, enabling instant approvals that previously required lengthy due diligence processes and on-site inspections that could take days or weeks, Mostafa El Sahn, Valu’s chief risk officer, said during a press conference attended by EnterpriseAM. Valu conducts an independent valuation of the underlying asset and links the loan amount to the estimated market value rather than the merchant-set price. Facilities are issued as fixed, non-revolving installment plans with defined tenors and clear monthly obligations, he added.

The bigger picture: The move comes as part of Valu’s strategy to expand beyond its revolving credit model into non-revolving facilities for high-ticket transactions — a direction CEO Walid Hassouna flagged to us last year. The shift is designed both as a risk-hedging measure, particularly after lower-income segments came under pressure during 2023-2024, and as a way to introduce differentiated products that are harder to replicate amid intensifying competition in the consumer finance market.

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8

PLANET FINANCE

Markets caught between AI hype and AI fear

Wall Street is wrestling with two competing fears about AI — and both are weighing on markets. Investors are selling companies they believe could be displaced by AI while simultaneously doubting that the hundreds of bns of USD big tech is pouring into the technology will generate meaningful returns anytime soon, Bloomberg reports. But Nomura International Wealth Management CIO Julia Wang argues that these two contradicting fears “can’t be true at the same time.”

The first fear is straightforward: AI may wipe out swaths of corporate America. Each new product launch from AI firms has triggered waves of selling in sectors ranging from wealth management and ins. brokering to software, logistics, and juridical services. Investors are scrambling to reassess which business models are at risk. Every new AI tool is being treated as another piece of evidence that change might arrive faster — and hit harder — than expected.

Investors’ second fear is that AI’s biggest champions are overspending without offering a clear timeline for returns. Microsoft, Amazon, Meta, and Alphabet are expected to spend more than USD 600 bn in capital expenditures in 2026 alone, reshaping their cashflow profiles. Microsoft and Meta have each lost 16% of their market value since 28 January, while Alphabet — widely seen as the frontrunner in the AI race — is trading 11% below its recent peak.

What has shifted is the market’s patience. For years, investors accepted that hyperscalers could spend heavily today to dominate tomorrow. Now, they are demanding clarity on when and how that payoff will materialize. “Investors were comfortable saying, ‘so long as it happens in the future, I’m comfortable with Microsoft or Amazon or Alphabet spending the money.’ Now they want to know more immediately when the payback will come — and we don’t have a clear picture,” Ameriprise Advisor Services’ Anthony Saglimbene said.

The consequences of that spending are already rippling through the real economy. Data center construction is tightening supplies of key components like memory chips, creating knock-on pressures across electronics, automotive, and telecom supply chains. “What is ahead of us between now and the end of this decade, in terms of demand, is bigger than anything we’ve seen in the past, and, in fact, will overwhelm all other sources of demand,” Lam Research Corp’s CEO Tim Archer told Bloomberg in a separate report.

And investors are raising questions about hyperscaler balance sheets. “This level of capex will consume almost 100% of hyperscalers’ cashflow from operations compared with a 10-year average of 40%,” wrote UBS Wealth Management’s Ulrike Hoffmann-Burchardi in a note to clients. “That spending is now increasingly being funded by external debt or equity financing,” she added.

Until investors can reconcile those competing narratives — that AI is both transformative and potentially overhyped — markets are likely to remain unsettled. “When the market finally feels these companies aren’t going out of business, it will realize AI is a tool that can lead to greater profitability,” said Saglimbene. “But we’re going to be in a period of volatility for the foreseeable future,” he added.

MARKETS THIS MORNING-

A lot of the Asia-Pacific markets we follow are closed today for the Lunar New Year. Of the few that are open, Japan’s Nikkei is in the red as investors continue to react to the country’s softer-than-expected 4Q 2025 growth.

EGX30

51,494

-1.6% (YTD: +23.1%)

USD (CBE)

Buy 46.71

Sell 46.85

USD (CIB)

Buy 46.70

Sell 46.80

Interest rates (CBE)

19.00% deposit

20.00% lending

Tadawul

11,184

-0.4% (YTD: +6.6%)

ADX

10,623

-0.1% (YTD: +6.3%)

DFM

6,702

-0.4% (YTD: +10.8%)

S&P 500

6,836

+0.1% (YTD: -0.1%)

FTSE 100

10,474

+0.3% (YTD: +5.5%)

Euro Stoxx 50

5,979

-0.1% (YTD: +3.2%)

Brent crude

USD 68.59

+1.2%

Natural gas (Nymex)

USD 3.24

+0.8%

Gold

USD 5,046

+2.0%

BTC

USD 68,791

-0.2% (YTD: -21.5%)

S&P Egypt Sovereign Bond Index

1,023

+0.1% (YTD: +3.1%)

S&P MENA Bond & Sukuk

153.28

+0.3% (YTD: +0.9%)

VIX (Volatility Index)

21.20

+2.9% (YTD: +41.8%)

THE CLOSING BELL-

The EGX30 fell 1.6% at yesterday’s close on turnover of EGP 9.9 bn (63.6% above the 90-day average). Local investors were the sole net buyers. The index is up 23.1% YTD.

In the green: Arabian Cement (+3.8%), ADIB (+3.0%), and Oriental Weavers (+2.3%).

In the red: Telecom Egypt (-12.4%), Egypt Aluminum (-6.0%), and Juhayna (-4.8%).

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Our weekly deep dive into the green economy and ESG issue in Egypt.

Published every Tuesday in EnterpriseAM.

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9

Going Green

Egypt’s wind localization wager is anything but a breeze

Egypt is turning its attention to wind power as the next frontier in its clean energy localization push, following earlier steps in solar panel and battery manufacturing at home. Electricity Minister Mahmoud Esmat has recently met with executives from China’s Sany Group to explore building Egypt’s first wind turbine factory. While details remain limited, the message is clear: wind turbine manufacturing is now on the table.

Why it matters: Wind localization sits a tier above solar in terms of industrial complexity. While solar panels can be assembled on relatively compact production lines, wind turbines are a different story: their scale demands vast factory space, heavy-duty engineering, and precision manufacturing across blades, towers, and nacelles. If Sany Group proceeds with the plan, it would rank among Egypt’s most ambitious industrial undertakings.

“There’s a lot more complexity to get this organized in Egypt,” CEO of Ras Ghareb Wind Energy and Red Sea Wind Energy Hans Bruins tells EnterpriseAM. With over eight years in Egypt and three utility-scale wind farms — including a 900 MW project set to break ground in April — Bruins has seen firsthand what meaningful localization entails.

A wind turbine crash course

A wind turbine is a layered machine. The tower is a hollow steel structure — heavy, bulky, and costly to transport — which is why it is typically localized first. Then come the blades — vast, composite structures made from fiberglass or carbon fiber, aerodynamically precise, and highly sensitive to damage during transport. At the top sits the nacelle, which houses the generator, gearbox, power electronics, cooling systems, and control software — the turbine’s mechanical and digital core.

That’s why wind localization moves in stages: Towers first, blades next, nacelle assembly after. Full generator and gearbox manufacturing only makes sense once volumes and tariff structures justify the investment.

The easy part

Some components make sense to localize — especially the big, bulky ones. “With towers, you’re basically transporting a lot of air — it’s just a hollow steel tower,” Bruins said, confirming that local components have already featured in his projects. In the first project, developed with Siemens Gamesa, parts of the towers were sourced from local steel manufacturers. In the second, 35 out of 104 towers were produced by NSF to Goldwind specifications.

Blades are more technically demanding, but the economic case for localization is strong. “From a handling perspective […] the blades are the most critical ones because they can be easily damaged during transport,” Bruins noted. At around 100 meters long, they carry high logistical costs and significant risk.

The hard part

The most difficult step is manufacturing the turbine’s core: the generator, gearbox, and control systems — the most complex and capital-intensive elements. Modern 10 MW turbines can power an entire village, and as Bruins puts it, “that’s the heart of the machine.”

For now, local assembly is the likely starting point. “You first start with assembling components, and once you’re good at that, then you can start to manufacture them locally,” Bruins said, drawing a parallel to the automotive industry.

How can we ensure a solid pipeline of GWs?

Localization only works if there’s a viable pipeline and a tariff structure that makes it bankable. “It all depends on what is going to happen with the tariffs,” Bruins said. Egypt has recently shifted from bilateral power purchase agreements to competitive tenders, adding time and risk. A single tender could take almost two years from pre-qualification to award.

Tenders also compress prices — sometimes to unsustainable levels. Referencing Saudi Arabia’s record-low wind tariffs, Bruins cautioned against direct comparisons. Egypt’s country risk premium sits around 700 bps, versus roughly 100 bps in the Kingdom. With that financing gap, “Egypt is actually already cheaper” when adjusting for cost of capital, he noted.

The worry is that developers may bid aggressively, only to struggle to make the business case work later. “Projects like these are usually 80% debt financed by international lenders,” Bruins said. A 1 GW project costing USD 1 bn would acquire roughly USD 800 mn in loans. If you’re paying 700 bps more in Egypt, you need a higher tariff to close, he explained.

Customs used to be the risk — now it’s improving

Past wind projects struggled with unpredictable customs delays. “In the first project, clearance sometimes ran into weeks, even months,” Bruins said. “That tied up capital and delayed site work.” In the second project, clearance time dropped to four or five days. “That’s a big improvement, and the Finance Ministry’s digitalization efforts are making a difference.” For the third project, he expects faster processing.

This matters because wind logistics are costly. “You’re talking about very costly components. If they’re stuck in customs and you have disruptions on site, that costs you an awful amount of money per day,” Bruins noted.

The blueprint?

Successful localization will require clustering, incentives, and long-term industrial planning. In China, wind manufacturing hubs “took 5-10 years to build,” Bruins noted, with towers, blades, generators, and electronics produced in the same area.

We could also take a page from how we did solar. Localization began with assembly and balance-of-system components before scaling alongside demand. The government created demand through policy mandates, giving manufacturers the confidence to invest.

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CALENDAR

2026

FEBRUARY

19 February (Thursday): First day of Ramadan (TBC).

25 February (Wednesday): IMF’s Executive Board meeting for our sixth and seventh reviews

MARCH

15 March (Sunday): IMF to hold its seventh review of Egypt’s USD 8 bn EFF arrangement.

21 March: (Saturday): Eid El Fitr starts (TBC).

30 March – 1 April (Monday-Wednesday): Egypt International Energy Conference and Exhibition (EGYPES).

APRIL

2 April (Thursday): Monetary Policy Committee’s second meeting of 2026.

12 April (Sunday): Coptic Easter.

25 April (Saturday): Sinai Liberation Day.

MAY

1 May (Friday): Labor Day.

21 May (Thursday): Monetary Policy Committee’s third meeting of 2026.

27-29 May (Wednesday-Friday): Eid El Adha (TBC).

JUNE:

30 June (Tuesday): National holiday in observance of the June 30 Revolution (TBC).

JULY

9 July (Thursday): Monetary Policy Committee’s fourth meeting of 2026.

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

AUGUST

20 August (Thursday): Monetary Policy Committee’s fifth meeting of 2026.

26 August (Wednesday): National holiday in observance of Prophet Muhammad’s birthday (TBC).

SEPTEMBER

15 September (Tuesday): IMF to hold its eighth review of Egypt’s USD 8 bn EFF arrangement.

24 September (Thursday): Monetary Policy Committee’s sixth meeting of 2026.

27-29 September (Sunday-Tuesday): Global Conference on Population, Health, and Human Development.

OCTOBER

6 October (Tuesday): Armed Forces Day.

29 October (Thursday): Monetary Policy Committee’s seventh meeting of 2026.

DECEMBER

17 December (Thursday): Monetary Policy Committee’s eighth meeting of 2026.

EVENTS WITH NO SET DATE

Early 2026: Passenger operations on the New Administrative Capital-Nasr City monorail scheduled to begin.

Early 2026: The government will launch the second package of tax breaks.

1Q 2026: Trial operations for the Ain Sokhna-Sixth of October section of Egypt’s first high-speed rail line scheduled to begin.

1Q 2026: Turkish President Recep Tayyip Erdogan to visit Egypt.

May 2026: End of extension for developers on 15% interest rates for land installment payments.

2H 2026: Operations at Deli Glass Co’s new USD 70 mn glassware factory kick off.

2027

20 January-7 February: Egypt to host the African Games.

April 2027: Tenth of Ramadan dry port and logistics hub to begin operations.

EVENTS WITH NO SET DATE

2027: Egypt to host EBRD’s annual meetings.

2027: Egypt-EU Summit 2027.

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

September 2028: First unit of the Dabaa nuclear power plant begins operations.

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