{"id":590993,"date":"2023-07-30T00:00:00","date_gmt":"2023-07-30T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/07\/30\/privatization-proceeds-in-the-state-coffers-by-september\/"},"modified":"2023-07-30T00:00:00","modified_gmt":"2023-07-30T00:00:00","slug":"privatization-proceeds-in-the-state-coffers-by-september","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/07\/30\/privatization-proceeds-in-the-state-coffers-by-september\/","title":{"rendered":"Privatization proceeds in the state coffers by September?"},"content":{"rendered":"

Good morning, wonderful people, and welcome to a beautiful Sunday morning<\/strong> packed with plenty of news as you prepare to head into the office, whether you\u2019re driving down from Sahel or about to tackle your usual commute. <\/p>\n

Before we get underway: A very happy birthday to the Resident 16 Year Old<\/strong>, who recently completed her first stint in our newsroom. You make Mom and me incredibly proud every single day, kiddo. <\/p>\n

SMART POLICY- Big news for folks with unfulfilled national service obligations: <\/strong> From 14 August, Egyptian men living abroad will be able to settle any outstanding military service obligation by paying EUR 5k \/ USD 5k, the Foreign Ministry said<\/a> Thursday. Applicants looking to settle obligations will need to register on a website and pay the fees into accounts at Banque Misr, according to the statement. The link to the application portal will go live in the coming days<\/strong>, the ministry siad. <\/p>\n

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<\/a> PSA-<\/strong> Fresh off of weeks of 40\u00b0C+ temperatures in the capital, the mercury is set to dip to a comparatively balmy 36\u00b0C in the capital through the rest of the week, according to Egyptian Meteorological Authority<\/a>. It\u2019s a forecast that will no doubt be greeted warmly by policymakers who have for the past two weeks been trying to figure out how to support the nation\u2019s electricity infrastructure amid rolling blackouts. <\/p>\n

That said: Our favorite weather app suggests it could be slightly hotter than that<\/strong>, with temperatures sitting at 38\u00b0C, 39\u00b0C tomorrow and then hovering around 40\u00b0C through next Sunday. <\/p>\n

We\u2019re hoping the national weather service is right with this one<\/strong>, with the prime minister now forecasting blackouts through until the end of August. In a presser on Thursday, Madbouly announced a host of new measures designed to reduce electricity demand and boost fuel supply, including a four-day work-from-office week for public-sector workers, an emergency mazut buy, and fresh electricity rationing in public spaces. We have more in this morning\u2019s news well, below. <\/p>\n

We should have more clarity tomorrow: <\/strong> Cabinet has promised to announce tomorrow a detailed schedule for blackouts and will limit outages to a daily total of no more than two hours per district , Cabinet spokesperson Nader Saad said in a televised interview last night ( watch, runtime: 6:41<\/a>). <\/p>\n

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<\/a> MPs REACT TO- The new USD certificates:<\/strong> Our elected representatives have given mixed reactions to the new USD-denominated savings certificates<\/a> launched last week by the National Bank of Egypt and Banque Misr, with some calling for additional measures to bolster the nation\u2019s FX reserves. Rep. Mohamed Abdel-Hamid, who serves as the deputy of the House Economic Committee, said the move would help to attract fresh FX inflows, but called on policymakers to boost remittances, which have fallen<\/a> in recent months amid the ongoing currency crisis. This was echoed by opposition MP Sherif Fayyad, who said that the certificates will not be able to close the parallel market on their own. <\/p>\n

Remember:<\/strong> The two lenders are offering two three-year certificates: one with a 9% annual percentage rate that pays out interest in EGP up front and another with a 7% rate that pays out in USD quarterly. Savers will have to deposit at least USD 1k to be eligible for the certificates, which will be repaid in USD at maturity. <\/p>\n

IN OTHER FX NEWS- <\/strong> The government has sold some USD 2 bn worth of land to <\/strong> companie s in the six months ending 30 June, a rea dout from the weekly cabinet meeting quotes Housing Minister Assem El Gazzar as saying. This came as the minister announced that the New Urban Communities Authority (NUCA) had approved a new batch of land sales under the government\u2019s land-for-FX initiative<\/a>, which allows foreign investors to circumvent the lengthy auction process by bidding directly for state-owned land , provided they pay in hard currency. The statement didn\u2019t disclose how much of the USD 2 bn was paid in FX. <\/p>\n

WATCH THESE SPACES-<\/strong> <\/p>\n

<\/a> #1- Privatization proceeds in the state coffers by September?<\/strong> The government expects to sign the final contracts to sell the USD 1.9 bn of state-owned assets next month<\/a> and receive the money by September, CNN Arabia<\/a> reports, quoting an unnamed government official. Investors are currently conducting due diligence on the assets ahead of agreeing final terms, the official reportedly said. <\/p>\n

Remember:<\/strong> The government took a big step forward with its privatization agenda earlier this month when Prime Minister Moustafa Madbouly announced agreements to sell stakes in a number of state-owned assets to local and Gulf investors. Around USD 1.65 bn will be paid in foreign currency and the remainder will be in Egypt. <\/p>\n

Who\u2019s buying what:<\/strong> ADQ is on board to acquire 30% of two petrochemicals firms and an oil services company, Talaat Moustafa Group and a group of foreign investors will purchase a significant minority stake in some of the country\u2019s most historic hotels, and Al Ezz Dekheila bought back the government\u2019s 31% stake in the company. <\/p>\n

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#2- <\/strong> US senators call for continued freeze on portion of military aid: <\/strong> Ten United States senators have urge d the Biden administration to withhold a quarter of Egypt\u2019s USD 1.3 bn in annual military aid for the third consecutive year, the Associated Press<\/a> reports. In a letter (pdf)<\/a> to President Biden, the senators \u2014 nine from the Democratic Party along with independent senator Bernie Sanders \u2014 are calling for the administration to freeze USD 320 mn in aid \u201cdue to a lack of necessary progress on human rights.\u201d <\/p>\n

Remember:<\/strong> The Biden administration blocked Egypt from receiving USD 130 mn of military aid<\/a> in 2021, a figure that increased to USD 205 mn<\/a> last year. Around USD 300 mn of total aid given to Egypt is contingent on the country making progress on human rights issues. <\/p>\n

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#3- Next round of export subsidy payouts pushed by 2 weeks: <\/strong> The Finance Ministry will pay out the third batch of export subsidies under the sixth phase of the program on 16 and 17 August, instead of 2-3 August<\/a>, it said in a statement<\/a> Friday . The ministry has so far paid out EGP 8 bn to over 800 companies during the current phase. <\/p>\n

REMEMBER-<\/strong> The government says it will quadruple export subsidies this fiscal year, with EGP<\/a> 28 bn<\/a> earmarked to the program during the current fiscal year. The larger allocation is aimed at helping the government reach its target to increase exports to USD 100 bn a year<\/a> by the middle of the decade. <\/p>\n

#4- Shalateen Mineral Resources could extend its gold tender: <\/strong> State-owned Shalateen Mineral Resources could apply to the Oil Ministry to extend the bid round for brownfield sites past the current 10 August deadline, Al Borsa<\/a> reported on Thursday, citing sources it says are familiar with the matter. Shalateen is inviting bids for concessions in five areas of the Eastern Desert. Bidding companies should<\/a> be producing more than 500k oz of gold a year, have more than 10 mn oz of gold reserves, and have 10 years of experience to qualify. <\/p>\n

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HAPPENING TODAY- <\/strong> <\/p>\n

<\/a> Key Palestine reconciliation talks are taking place today: <\/strong> Palestinian President Mahmoud Abbas and Hamas chief Ismail Haniyeh will attend a new round of reconciliation talks<\/a> between Palestinian groups taking place in El Alamein today, Al Arabiya<\/a> reports. The meeting, spearheaded by Egypt to heal the long-running divisions among different Palestinian factions, will be attended by representatives of Fatah, Hamas and the Popular Front for the Liberation of Palestine. Palestinian Islamic Jihad is boycotting the talks. <\/p>\n

El Sisi x Abbas:<\/strong> President Abdel Fattah El Sisi will have a one-on-one with Abbas to discuss the peace process and recent developments in Israel and the occupied territories, the news outlet quotes Palestinian ambassador to Egypt, Diab Al Louh, as saying. <\/p>\n

<\/a> On the menu at the National Dialogue:<\/strong> The dialogue is resuming its general<\/a> sessions<\/a> today with get-togethers planned on political rights, trade unions, and local administration. The public session will discuss the 1956 law on political rights, which many political parties want to see amended to introduce a more open political system that provides greater candidacy rights and encourages voting. <\/p>\n

For the rest of the week:<\/strong> <\/p>\n