{"id":646376,"date":"2017-06-13T04:08:35","date_gmt":"2017-06-13T04:08:35","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/"},"modified":"2017-06-13T04:08:35","modified_gmt":"2017-06-13T04:08:35","slug":"manufacturers-delay-investments-due-to-central-banks-interest-rate-hike","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/","title":{"rendered":"Manufacturers delay investments due to Central Bank\u2019s interest rate hike"},"content":{"rendered":"

<\/a> Others are not so sanguine, saying high interest rates are prompting <\/strong>them to delay capex outlays. <\/strong>Some manufacturers have reportedly put planned investments on hold after the central bank hiked key interest rates by 200 bps last month, Al Borsa says<\/a>. Alfa Ceramics is planning to cut investment in new production lines this year to EGP 20-30 mn, after initially budgeting in EGP 150 mn for five lines, company head Wageeh Besda said. Universal Group is also pushing back plans for electronic appliances production lines until next year due to the rate hike, while others such as El Welely Crops, decided to halt expansion plans indefinitely.<\/p>\n

Why is this happening? It\u2019s all about return on investment.<\/strong> Abraaj partner Ahmed Badreldin forecast this slowdown in our January 2017 CEO Poll, saying at the time, \u201cHigh interest rates will definitely make investment decisions more difficult for some businesses. When you\u2019re looking at deposit interest rates at 19-20% for 18 months offered by some banks, investing in capex and new capacity will demand higher returns compared to simply parking liquidity in a time deposit. His remarks \u2014 including his \u201ccounterintuitive\u201d call for an interest rate cut<\/strong> \u2014 should be required reading for us all this morning<\/strong><\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Others are not so sanguine, saying high interest rates are prompting them to delay capex outlays. Some manufacturers have reportedly put planned investments on hold after the central bank hiked key interest rates by 200 bps last month, Al Borsa says. Alfa Ceramics is planning to cut investment in new production lines this year to […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8572],"tags":[72,2380],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-646376","post","type-post","status-publish","format-standard","hentry","category-speed-round","tag-enterpriseam","tag-speed-round","wpautop","entry"],"acf":{"mongo_id":"2cea2211-af0e-43de-a237-9f249dd9fb25","order":"0","is_powered_by":true,"section_story_id":"b032eb33-df4e-4a7c-91db-b6c83c1a5382","story_type":"1","photo_url":"","photo_position":"above","related_issue":[646367],"teaser":"","voice_url":""},"yoast_head":"\nManufacturers delay investments due to Central Bank\u2019s interest rate hike - EnterpriseAM Egypt<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Manufacturers delay investments due to Central Bank\u2019s interest rate hike\" \/>\n<meta property=\"og:description\" content=\"Others are not so sanguine, saying high interest rates are prompting them to delay capex outlays. Some manufacturers have reportedly put planned investments on hold after the central bank hiked key interest rates by 200 bps last month, Al Borsa says. Alfa Ceramics is planning to cut investment in new production lines this year to […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/\" \/>\n<meta property=\"og:site_name\" content=\"EnterpriseAM Egypt\" \/>\n<meta property=\"article:published_time\" content=\"2017-06-13T04:08:35+00:00\" \/>\n<meta name=\"author\" content=\"enterpriseam admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"enterpriseam admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/\"},\"author\":{\"name\":\"enterpriseam admin\",\"@id\":\"https:\/\/enterpriseam.com\/egypt\/#\/schema\/person\/ca597032db7e4db868359c123cec256d\"},\"headline\":\"Manufacturers delay investments due to Central Bank\u2019s interest rate hike\",\"datePublished\":\"2017-06-13T04:08:35+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/\"},\"wordCount\":210,\"publisher\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/#organization\"},\"keywords\":[\"EnterpriseAM\",\"SPEED ROUND\"],\"articleSection\":[\"Speed Round\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/\",\"url\":\"https:\/\/enterpriseam.com\/egypt\/2017\/06\/13\/manufacturers-delay-investments-due-to-central-banks-interest-rate-hike\/\",\"name\":\"Manufacturers delay investments due to Central Bank\u2019s interest rate hike - 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Packaging manufacturer HiPack, for example, plans to invest EGP 3.5 bn in new production lines over an unspecified period, HiPack\u2019s export director Ihab El Shoury tells\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":645458,"url":"https:\/\/enterpriseam.com\/egypt\/2017\/07\/20\/misr-hotels-company-halts-new-investments-following-interest-rates-hike\/","url_meta":{"origin":646376,"position":1},"title":"Misr Hotels Company halts new investments following interest rates hike","author":"enterpriseam admin","date":"20 July 2017","format":false,"excerpt":"Misr Hotels Company is freezing expansion plans until the CBE decreases interest rates and inflation cools, according to chairman Amr Attia, Al Borsa reports. \u201cAs long as interest rates are at their current levels, we will not enter new investments,\u201d Attia says. The company allocated EGP 183 mn in investments\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":645269,"url":"https:\/\/enterpriseam.com\/egypt\/2017\/07\/17\/arafa-holding-freezes-investment-plans-on-cost-of-capital-concerns\/","url_meta":{"origin":646376,"position":2},"title":"Arafa Holding freezes investment plans on cost of capital concerns","author":"enterpriseam admin","date":"17 July 2017","format":false,"excerpt":"Arafa Holding has \u201cno plans to inject any new investments in Egypt\u201d in the coming period following the central bank\u2019s decision to raise interest rates, Chairman and CEO Alaa Arafa told Al Shorouk. The cost of capital at the moment is not conducive to new investment, Arafa said, adding that\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":646643,"url":"https:\/\/enterpriseam.com\/egypt\/2017\/06\/20\/agriculture-companies-holding-back-on-capex-amid-high-interest-rates\/","url_meta":{"origin":646376,"position":3},"title":"Agriculture companies holding back on capex amid high interest rates","author":"enterpriseam admin","date":"20 June 2017","format":false,"excerpt":"Until rates do come down, some business owners are feeling the pinch and are thinking twice about new investment, say players in the agriculture sector speaking with Al Bora. 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