{"id":611557,"date":"2023-12-08T00:00:00","date_gmt":"2023-12-08T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/12\/08\/this-weekend-shoukry-among-leaders-pushing-for-an-end-to-israeli-aggression-net-foreign-reserves-inch-higher-in-november\/"},"modified":"2023-12-08T00:00:00","modified_gmt":"2023-12-08T00:00:00","slug":"this-weekend-shoukry-among-leaders-pushing-for-an-end-to-israeli-aggression-net-foreign-reserves-inch-higher-in-november","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/12\/08\/this-weekend-shoukry-among-leaders-pushing-for-an-end-to-israeli-aggression-net-foreign-reserves-inch-higher-in-november\/","title":{"rendered":"THIS WEEKEND: Shoukry among leaders pushing for an end to Israeli aggression + Net foreign reserves inch higher in November"},"content":{"rendered":"

Good morning friends and happy Friday to us all. <\/strong>As you chase the winter sun this weekend we have an issue packed with news updates and activities to keep you engaged as the year comes to an end. <\/p>\n

Egypt is packed with travel opportunities,<\/strong> if traveling out of Egypt isn\u2019t an option for you, and we intend to guide you on some destinations you may not have considered or should probably re-visit this winter.<\/p>\n

Enterprise Weekend comes out each Friday at 9:00am CLT.<\/strong> We\u2019ll be back on Sunday at 6am with EnterpriseAM. Until then: Enjoy the weekend.<\/p>\n

LAST WEEK IN 3 MINS-<\/strong><\/p>\n

Israel\u2019s devastating military campaign in Gaza \u2014 which is now on its 63rd day \u2014 topped headlines at home and around the <\/strong>world <\/strong>as fighting intensified and Palestinian civilians were left with virtually no options for safe refuge. <\/p>\n

On the domestic front, we had a handful of troubling macro indicators, some major<\/strong> energy updates<\/strong>, and some progress on the state\u2019s privatization drive, which could see stakes in another military-owned fuel retailer offloaded in the near future. <\/p>\n

ISRAEL\u2019S RAMPAGE IN GAZA-<\/strong><\/p>\n

#1- Israel resumed its bombing campaign in Gaza late last week <\/strong>after negotiations with Hamas to extend the temporary ceasefire collapsed. The Israeli forces said on Saturday<\/a> that it had bombed 400 targets in Gaza and 50 targets in Khan Younis in the first 24 hours following the end of the truce, airstrikes which according to the Gaza Health Ministry killed 193 Palestinians. Further attacks<\/a> throughout the week have severely strained remaining Palestinian hospitals.<\/p>\n

\u2026and continued to push thousands of Palestinians towards the Egyptian border:<\/strong> The Israeli military expanded its devastating air campaign<\/a> and ground invasion<\/a> to the south of the territory, where it had previously ordered hundreds of thousands of civilians living in the north to flee.<\/p>\n

#2- <\/strong>Nearly 18<\/a><\/strong>k Palestinians<\/a><\/strong> have been killed in Gaza since 7 October<\/strong> and over 400k people in northern Gaza no longer have access to medical services, while at least 1.8 mn people \u2014 almost 80% of the population \u2014 have been internally displaced<\/a> over the course of the past nine weeks.<\/p>\n

Foreign Minister Sameh Shoukry <\/strong>will join other Arab and Islamic ministers<\/a><\/strong> in DC for a meeting with US Secretary of State Antony Blinken<\/strong>amid ongoing efforts to put an end to Israeli aggression.<\/p>\n

MACRO + FISCAL + MONETARY INDICATORS CONTINUED TO POUR IN\u2026<\/strong><\/p>\n

#1- We have at least <\/strong>USD 42.3 bn in foreign debt<\/a><\/strong> to repay in 2024. <\/strong>Egypt will have to pay some USD 32.8 bn to fulfill medium and long-term debt obligations in 2024 in addition to USD 9.5 bn in short-term debt obligations during the first half of 2024. <\/p>\n

#2- Net foreign liabilities hit a record high in October<\/strong> as pressure on the country\u2019s external position continued to mount. Our net foreign asset deficit widened to USD 27.2 bn<\/a> from USD 26.8 bn in September. <\/p>\n

Meanwhile, our net foreign reserves inched up for the fifteenth consecutive month in November<\/strong>, according to Central Bank of Egypt (CBE) data<\/a> released yesterday. Our reserves rose to USD 35.2 bn at the end of November vs USD 35.1 bn at the end of October. The CBE managed to recover<\/a> a total of USD 2 bn since September 2022. <\/p>\n

AND<\/strong>-<\/strong>We\u2019ve seen more meetings between the IMF and Egyptian officials <\/strong>ahead of the anticipated post-election devaluation, with the most recent<\/a> one taking place at COP28 between IMF head Kristalina Georgieva and CBE Governor Hassan Abdalla, where Georgieva said she expects the size of the loan to Egypt to be increased due to the country\u2019s \u201cadditional burden and the impact of the surrounding external crises.\u201d<\/p>\n

#3-<\/strong>Egypt\u2019s <\/strong>budget deficit almost doubled y-o-y<\/a><\/strong> in the first quarter of the current fiscal <\/strong>year <\/strong>as rising borrowing costs squeeze public finances. The deficit widened to 3.9% of GDP in 1Q FY 2023-24 from 2.1% a year earlier, largely due to the government\u2019s spiraling interest bill.<\/p>\n

#4- The Madbouly government <\/strong>downgraded its growth forecast<\/a><\/strong> for the current fiscal year <\/strong>by 0.7 percentage points,<\/strong> to a 3.5% clip in the fiscal year ending June 2024, down from a previous 4.2% forecast last month.<\/p>\n

#5-<\/strong>Egypt\u2019s non-oil private sector remained in contraction in November, albeit at a softer pace<\/strong>, as inflationary pressures weighed on demand and sent business confidence to record lows, according to S&P Global\u2019s purchasing managers\u2019 index<\/a>. The PMI came in at 48.4 in November, up slightly from 47.9 in October. <\/p>\n

MAKING MOVES IN THE GULF- <\/strong><\/p>\n

#1- The Engineering Export Council of Egypt will start a weeklong <\/strong>trade mission<\/a><\/strong> to Saudi <\/strong>Arabia tomorrow <\/strong>with an eye to bring in orders and investment for pumps, car parts, and boilers, among other products. <\/p>\n

SOME MOVEMENT ON THE STATE\u2019S PRIVATIZATION PROGRAM-<\/strong><\/p>\n

#1- The government is looking to offload a stake in the military\u2019s Chill Out fuel retailer,<\/strong>Planning Minister Hala El Said said on the sidelines of COP28<\/a>. The company is owned by the National Service Projects Organization (NSPO) via its National Roads Company subsidiary, and would become the second military-owned fuel retailer to sell shares to private investors after Wataniya.<\/p>\n

\u2026but Wataniya\u2019s stake sale has been delayed<\/strong>: We were expecting the government to finalize the sale later this month but according to El Said the transaction will take several more weeks to close. <\/p>\n

ALSO- The government plans to complete the sale of a stake in a group of historic hotels <\/strong>before the end of the year<\/strong>, according to El Said.<\/p>\n

#2- SFE brings in advisor to assist with massive wind farm sales:<\/strong> The Sovereign Fund of Egypt (SFE) appointed<\/a> Belgium-headquartered Tractebel<\/a> to act as a consultant for the sale of stakes in the state-owned 580-MW Gabal El Zeit and 545-MW Zafarana wind farms.<\/p>\n

MEANWHILE- Officials are mulling the sale of <\/strong>EGP 8 bn worth of real estate assets<\/a><\/strong> to investors in <\/strong>1Q 2024<\/strong>. Heliopolis Housing and Development is among the state-run companies investors are looking at selling along with private sector partnerships that will see investors developing land plots owned by state-run companies.<\/p>\n

A SMATTERING OF ENERGY NEWS-<\/strong><\/p>\n

#1- Norwegian renewables company Scatec <\/strong>inked a USD 1.1 bn green methanol MoU<\/a><\/strong> with <\/strong>the Suez Canal Economic Zone (SCZone)<\/strong> this week at COP28 in Dubai. <\/p>\n

#2- Scatec is also looking to establish a 1-GW solar and 200-MWh battery storage project <\/strong>in Egypt<\/strong>under an agreement signed<\/a> with the Egyptian Electricity Holding Company (EEHC) also at COP.<\/p>\n

#3- A group of state-owned companies are looking to set up a second plant for producing <\/strong>green fuel in the Suez Canal Economic Zone (SCZone)<\/strong>. The consortium, which includes Helwan Fertilizers, Abu Qir Fertilizers, and Al Ahly Capital Holding have their eyes<\/a> on a green ammonia project that would require USD 1.2 bn of investment. <\/p>\n

#4- UAE-based K&K Group signed an MoU with Italian firm CESI to develop a subsea <\/strong>electricity link connecting Egypt to Italy<\/strong>. The proposed 3<\/a>GW<\/a>link<\/a> would ship power generated by renewable energy in Egypt across the Med.<\/p>\n

#5<\/strong>- Infinity Power, Hassan Allam Utilities, and Masdar are set to start construction on <\/strong>their 10 GW wind farm in 1Q 2025<\/strong>. The consortium is planning to reach financial closure by 1Q 2025<\/a> with operations scheduled to begin in 2027. <\/p>\n

DEBT WATCH- <\/strong><\/p>\n

#1- Egypt could turn to Indian capital markets next year: <\/strong>The Finance Ministry is looking to raise USD 500 mn in a bond issuance in India in 2024, Minister Mohamed Maait said earlier this week<\/a>. <\/p>\n

#2- The African Development Bank (AfDB) <\/strong>approved a USD 148 mn financial package<\/a><\/strong> for <\/strong>CIB <\/strong>foron-lending to clients and strengthening its capital position.<\/p>\n

#3- GB Corp\u2019s auto financing arm Drive <\/strong>raised EGP 1.4 bn<\/a><\/strong> via a securitized bond <\/strong>issuance.<\/strong> The issuance, which was 1.7x oversubscribed, is the first in Drive\u2019s three-year EGP 5 bn securitization program. <\/p>\n

TOURISM- <\/strong><\/p>\n

Tourism bookings to <\/strong>Egypt<\/strong> will be <\/strong>back on track<\/a><\/strong> after the holiday season<\/strong> as\u201cconfidence returns and customers seek what is a value winter sun destination,\u201d travel agency TUI CEO Sebastian Ebel told Reuters<\/a>. <\/p>\n

SOME INDUSTRIAL MANUFACTURERS ARE GETTING A BOOST- <\/strong><\/p>\n

#1- China-based chemicals manufacturer Befar Group could build a USD 2 bn industrial<\/strong> complex<\/strong> to produce specialty chemicals in East Port Said under a letter of intent<\/a> signed with the Suez Canal Economic Zone (SCZone) last week. <\/p>\n

#2- UAE-based Sharkia Group fertilizers manufacturing arm Futurefert will set up <\/strong>a USD<\/a><\/strong>50 mn<\/a><\/strong> fertilizer complex<\/strong> in Elsewedy\u2019s Sokhna 360 industrial zone. <\/p>\n

#3- Chinese fiberglass manufacturer Jushi <\/strong>will invest USD 8 mn to expand its factory in<\/a><\/strong>China\u2019s TEDA trade zone<\/a><\/strong> after Elsewedy Industrial Development awarded it a 60k-sqm plot.<\/p>\n

#4- Catalyst Capital Egypt <\/strong>acquired a 30%<\/a><\/strong> stake in a new Alex Steel subsidiary <\/strong>in exchange fora EGP 100 mn investment in the company named Alexandria for Industrial Development (AID). <\/p>\n

WHAT\u2019S HAPPENING NEXT WEEK-<\/strong><\/p>\n

<\/p>\n

Capmas and the CBE will publish last month\u2019s inflation data on Sunday, 10 December.<\/strong>Annual urban inflation in October eased for the first time in six months to 35.8% y-o-y<\/a> from 38.0% in September due to slowing food and beverage price inflation. <\/p>\n

Voters here at home will head to the polls from Sunday to Tuesday <\/strong>to cast their ballots in the presidential election. First-round results are due on 18 December and a runoff, if necessary, will take place in early January.<\/p>\n

The US Federal Reserve Open Market Committee meets next Tuesday and Wednesday<\/strong>, with policymakers expected<\/a> to hold rates steady next week for the third meeting in a row as inflation in the US gradually cools. Rate cuts could, however, be in the cards over the coming months \u2014 the mere hint of which sent the USD to three-month lows last week<\/a>. <\/p>\n

El Gouna Film Festival kicks off next Thursday, 14 December <\/strong>and runs through the following week on Thursday, 21 December.<\/p>\n

The bidding deadline for five gold mine concessions in the Eastern Desert elapses Thursday,<\/strong> 14 December. <\/strong>The bidding deadline<\/a> for the Eastern Desert concessions was initially slated for 9 November. <\/p>\n

Check out our full calendar on the web<\/a><\/strong> for a comprehensive listing of upcoming news events, national holidays and news triggers.<\/p>\n

YOUR MOST CLICKED LINKS-<\/strong><\/p>\n