{"id":625885,"date":"2018-08-26T04:12:03","date_gmt":"2018-08-26T04:12:03","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2018\/08\/26\/what-were-tracking-on-26-august-2018\/"},"modified":"2018-08-26T04:12:03","modified_gmt":"2018-08-26T04:12:03","slug":"what-were-tracking-on-26-august-2018","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2018\/08\/26\/what-were-tracking-on-26-august-2018\/","title":{"rendered":"What we\u2019re tracking on 26 August 2018"},"content":{"rendered":"

Welcome back, ladies and gentlemen \u2014 and welcome to the last real week of summer. <\/strong>A metric s*ton of news has unfolded in the week we\u2019ve been on vacation, most of it either (a) in international news or (b) foreign media coverage of Egypt. We\u2019ve boiled it all down to its essence for you this morning to help you get back into the swing of things.<\/p>\n

Our advice for today: <\/strong>(a) Quickly take stock of the five things that were most important to your work life before you went on vacation. Then think through (b) what five things are most important this week and (c) what five things will define your priorities as we slip into fall.<\/p>\n

<\/a> Five things we were all talking about in the week before the Eid holiday:<\/strong><\/p>\n

1. Will the fall window for Egyptian equity offerings slam shut in the face of the Emerging Markets Zombie Apocalypse?<\/strong> EGX boss Mohamed Farid expects 4-5 IPOs over the coming eight months<\/a> (about right, if you ask us, provided the stars remain aligned). And the government looks set to push forward with stake sales at already-listed state-owned companies. But emerging market equities had \u201cslumped into a bear market\u201d territory<\/strong>, falling to a six-month low on the back of weak Chinese economic data and EM currencies taking a hit. Our explainer<\/a> on what was (and is) going on is here.<\/p>\n

2. Macro and confidence indicators were looking good across the board: <\/strong>Corporate earnings in 2Q looked reasonably good. Unemployment<\/a> was down in 2Q2018. Hotel occupancy<\/a> was on the rise (at last before the death of two British tourists in Hurghada). The purchasing managers\u2019 index<\/a> for July points to an ongoing private-sector recovery (and yes, it was out later than usual). And inflation<\/a> cooled in July, falling to 13.5% after a surge in June.<\/p>\n

3. It\u2019s going to be a long winter for FDI \u2014 unless interest rates start trending down:<\/strong> Bloomberg\u2019s declaration that traders looking for refuge from volatility will find it in Egypt<\/a> was getting plenty of attention, as was DPI\u2019s high-profile investment in a GB Auto financing company<\/a> and Lightsource BP\u2019s joint venture with Hassan Allam<\/a>. On the other side of the coin, we think it fair to say there is now consensus that major foreign direct investment will be limited until Egyptian companies start to invest in themselves as interest rates (eventually) decline. Recent FDI announcements track largely to Saudi and Chinese companies. The CBE next meets to discuss interest rates at the end of September.<\/p>\n

4. Everyone was up in arms about the <\/strong>real estate tax<\/strong><\/a>. <\/strong>Well, maybe not everyone. Maybe all the folks who sunk their savings into real estate prior to the float of the EGP, at which time second (and third and fourth and fifth) houses were the investment of choice for many. (Remember, that was a time when receipts for the future delivery of automobiles had effectively become tradable securities.)<\/p>\n

5. Our dream of becoming an energy hub becomes real in January <\/strong>when Egypt is expected to make its first foreign sales of natural gas<\/a> since before 25 January 2011. Israel looks like its backing natgas exports to Egypt<\/a>, and there\u2019s lots more exploration<\/a> taking place.<\/p>\n

What happened outside Egypt in the last week<\/strong> that\u2019s of relevance to us?<\/p>\n