{"id":593991,"date":"2019-10-16T04:13:30","date_gmt":"2019-10-16T04:13:30","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2019\/10\/16\/what-were-tracking-on-16-october-2019\/"},"modified":"2019-10-16T04:13:30","modified_gmt":"2019-10-16T04:13:30","slug":"what-were-tracking-on-16-october-2019","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2019\/10\/16\/what-were-tracking-on-16-october-2019\/","title":{"rendered":"What we\u2019re tracking on 16 October 2019"},"content":{"rendered":"

The IMF\u2019s World Economic Outlook October update is here, and it\u2019s pretty much as bleak as everyone expected.<\/b> The fund revised downwards its global growth projections for this year and the next on the back of challenging macro conditions, including the US-China trade war. We have chapter and verse in this morning\u2019s Speed Round, below.<\/p>\n

Prime Minister Moustafa Madbouly is in Washington, DC, to attend the annual meetings of the IMF and World Bank<\/b>, according to Ahram Online<\/a>. Investment and International Cooperation Minister Sahar Nasr is also in the American capital for the meetings, which run from 14-20 October. You can check out the meeting website here<\/a>.<\/p>\n

Euroclear agreement coming soon:<\/b> The Finance Ministry expects to officially sign an MoU with Euroclear while its officials take part in the Washington events this week, the State Information Service said<\/a>. Egypt\u2019s debt instruments are expected<\/a> to be clearable through the Belgium-based clearinghouse by the beginning of next year.<\/p>\n

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The big news of the morning for the buy- and sell-sides is that it looks likely that the (presently suspended) capital gains tax on EGX transactions is going the way of the dodo bird<\/b> and with it (to a large extent) the stamp tax on EGX trades. More on that in today\u2019s Speed Round, below. We\u2019re widely (and accurately) accused of being pro-business. We say as much on our website: We have opinions, we express them, and they are generally \u201cpro free-market, pro-reform and secular.\u201d But this move leaves a taste in the mouth.<\/p>\n

The potential scrapping of the capital gains tax for EGX investors begs the admittedly uncharitable and self-interested question: <\/b>Why are those who take positions in publicly traded companies such a special breed that they must be protected from capital gains taxes and stamp taxes, while those who build privately held companies are comparatively wrung dry?<\/p>\n

Smart tax policy is widening the tax base<\/b> by encouraging SMEs to go legit or by moving to tax global giants (such as tech companies) that operate here effectively without paying a piaster in income tax. It is not squeezing blood from stones, nor is it rewarding people who have a shiny gauge to point at (say, the performance of the EGX30) and a willingness to protest (witness the literal protests that accompanied the original introduction of the capital gains tax on EGX transactions back in 2017). As it is, we\u2019re rewarding those who invest in public equities and punishing those who spend years or decades building private businesses <\/b>that similarly create jobs and contribute to economic growth.<\/rant><\/p>\n

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The two-day \u2018Egypt Can\u2019 conference wraps today.<\/b> The event brings together 65 top investors in Egypt as well as representatives from international financial institutions, the domestic business community and the Egyptian government.<\/p>\n

BEBA doorknock mission next month:<\/b> The British Egyptian Business Association (BEBA) will be heading to the UKby the end of November for their annual doorknock mission, according to the local press<\/a>.<\/p>\n

Key dates for your diaries this month:<\/p>\n