| Govt Selects Former CBE Governor to Head SWF Advisory Committee The Egyptian government selected Farouk El-Okda, former governor of the Central Bank of Egypt (CBE), to head the advisory committee responsible for appointing the Sovereign Wealth Fund's (SWF's) executive, Planning Minister Hala El-Saeed said on Wednesday. "The SWF regulations are expected to be wrapped up within two weeks," El-Saeed told Al-Mal newspaper. El-Saeed had earlier stated that around 400 people had applied for the SWF's CEO post, adding that the list will be shortened to include only five applicants for the committee to choose from. "The government aims to lure Egyptian candidates, whether they are based in the country or overseas, from the fields of finance, investment and fund management," she said. Last July, Egypt introduced the SWF with a capital of EGP 200 billion (roughly $11 billion) as a financial mechanism to allow the country gain investment returns by locking up sums of cash in a long-term fund. The management of the state's funds and assets should, in turn, lead to a sustainable economic development. | | Finance Ministry Inks Protocols With Banque Du Caire, Federation of Egyptian Banks to End Tax Disputes The Egyptian finance ministry signed on Wednesday three cooperation protocols with Banque Du Caire and Federation of Egyptian Banks -- which connects all Egyptian and foreign banks in the country -- as it attempts to put an end to the existing tax disputes. The ministry move aims "to sponsor the rights of financiers and establish clear rules for banks' tax accounting systems," Finance Minister Mohamed Maait said during a signing ceremony in the presence of Prime Minister Mostafa Madbouly. It aims to do so by preventing tax evasion and streamlining and facilitating the tax payment process, Maait added. The Egyptian government has been exerting efforts to "enhance financial inclusion and shift towards a cashless society." Earlier in September, the finance ministry unveiled a newly-designed website where financiers and registrars are required to pay their tax bills as it attempts to facilitate and simplify the procedures of tax collection. It also issued a new decree in early October that will allow for the unification of tax registration numbers, meaning that taxpayers will soon use a single registration number to pay their income tax, value-added tax, real estate tax and any other due taxes. | | Foreign Direct Investment  Investment Minister Lures Foreign Investors With Egypt's National Projects Egypt's Investment Minister Sahar Nasr has called on foreign investors to pump new investments in Egypt, particularly in national projects such as the flagship Suez Canal Axis Development and the New Administrative Capital east of Cairo. "We are very much for creating jobs because it's one of the main challenges in Egypt and we want to be more export-oriented," Nasr told a panel at the Future Investment Initiative (FII) in Riyadh on Wednesday. During the forum, the minister discussed increasing cooperation between the Egyptian investment ministry and the Saudi Public Investment Fund (PIF) to promote Saudi investments in Egypt in light of the strategic relations between both countries. Egypt targets foreign direct investments (FDIs) of $10 billion in the 2018/2019 fiscal year, up from $7.9 billion in the prior fiscal year. With FDIs dropping globally by 41 percent in the first half of 2018, Egypt has remained the top destination in Africa during the first half of 2018. | | Cabinet Forms New Committee to Boost FDI The Egyptian cabinet formed a new committee to boost incoming foreign direct investment (FDI) at the same time that foreign investors have been exiting emerging markets, opting for more stable returns on their investments. The committee will work on marketing Egypt's investment opportunities worldwide and placing them on the global map, according to a statement released by the investment ministry on Wednesday. In recent months, foreign investors have been pulling their money out of emerging markets, especially after the US has raised its interest rates, becoming more appealing to invest in. However, Egypt's international investment figures have improved lately. Last month, the United Nations Conference on Trade and Development (UNCTAD) said Egypt remains the first investment destination in Africa during the first half of 2018, as total foreign investment inflows rose by 24 percent compared to the same period last year. Egypt's current account deficit narrowed by 58.6 percent year on year to $6 billion in the 2017/2018 fiscal year, down from $14.4 billion in 2016/2017. | | International Trade Minister Boasts About Growing Egypt-US Bilateral Trade Egypt's trade minister said on Wednesday that Egypt-US relations have been growing significantly recently, with bilateral trade posting a 33 percent rise during the first nine months of 2018 to $5.6 billion, up from $3.8 billion year on year. Amr Nassar's remarks came during his meeting with a delegation of 44 US companies, who are on a visit to Egypt to explore prospective business opportunities in the local market, according to a statement by the ministry. The meeting was also attended by other Egyptian ministers seeking mutual cooperation, including ministers of social solidarity, planning and finance. On Tuesday, President Abdel Fattah El-Sisi met with some members of the delegation such as senior representatives from the United States Trade Development Agency (USTDA), the Overseas Private Investment Corporation (OPIC), the Export-Import Bank of the United States (Ex-Im) among other multilateral financial institutions. The "US Business Mission" to Egypt is organized by the American Chamber of Commerce in Egypt (AmCham Egypt), in conjunction with the US Chamber's US-Egypt Business Council and the Egypt-US Business Council, from October 23-25. | | Eastern Company's Profits Fall 4.8% in Q1 FY2018/19 Eastern Company's profits fell by 4.8 percent in the first quarter of the 2018/2019 fiscal year, with the company attributing the drop to a decrease in interest rates on its accounts receivables, according to a bourse filing. The company's profits fell to EGP 991 ($55.6) million, down from EGP 1 billion ($56.1 million) in the same quarter last year. Eastern Company's interests on its accounts receivables have declined to EGP 129 ($7.2) million from EGP 235 million last year, leading to the drop in profits. The company's sales, however, have increased to register EGP 3.4 billion ($190.7 million), up from EGP 3.2 billion in the same period the previous year. Earlier this year, the Central Bank of Egypt lowered interest rates by 1 percent as a response to a decrease in inflation. | | Govt Introduces Discounted Vegetables, Fruit Amid Potato Scarcity The Supply Ministry began on Wednesday to offer via its outlets various types of vegetables and fruit at lower prices than in the market in an effort to control price hikes. The step comes as part of an initiative that was launched a day earlier by the ministry in collaboration with Food Industries Holding Company. The initiative aims at making available discounted vegetables and fruit, especially after their prices have soared recently. It is based on purchasing the vegetables and fruit directly from farmers so as to reduce any additional costs and offer them to citizens at prices lower than those offered in the market. Meanwhile, the local market is continuing to witness a shortage of potato after its price jumped to unprecedented levels. The Potato Producers Association justified the increase in price by saying farmers had planted smaller crops this year after they were underpaid last year. It also cited climate change as one of the reasons affecting the crop's quality this year. Prices of vegetables and fruit have been on the rise in recent months, which contributed to an increase in Egypt's inflation rate. Headline inflation rose to 16 percent in September, up from 14.24 percent in August, according to a report issued earlier by the official statistics agency CAPMAS. | | Egypt, Japan Sign MoU to Establish Textile Plant Egypt and Japan signed yesterday a memorandum of understanding to establish a new plant for textile manufacturing in the Nile Delta governorate of Kafr El-Sheikh, which will be financed by Japan Bank for International Cooperation (JBIC). The MoU was inked by the Holding Company for Cotton Spinning Weaving and Clothes -- an affiliate of the ministry of public enterprises -- and Japan's Marubeni Corporation. According to a ministry statement, JBIC "showed willingness to provide advisory services in the fields of engineering and construction and supply machines and equipment." This comes in light of a study prepared by global advisory firm Warner with regard to upgrading the subsidiaries of the holding company through a loan to be repaid over 10 years with a grace period of 3 years. The new plant will be built over an area of 80 acres in the industrial zone, Balteem city. | | Finance Ministry Extends Tobacco Storage Period to 2 Years The finance ministry issued a decision that will allow tobacco to be stored for two years, giving producers a respite. This came during a meeting between Finance Minister Mohamed Maait and members of the tobacco division of the Chamber of Food Industries at the Federation of Egyptian Industries, as well as representatives of tobacco producers. The new decision revokes an earlier one issued in 2011, which limited the storage period to one year. Alexandria Customs Authority began last July to implement the one-year storage decision, without notifying companies. The decision prompted the tobacco chamber to submit a memo to the finance ministry last month, in which it requested restoring the three-year period for tobacco storage at warehouses so as to "maintain the strong yields to the state treasury and push the local economy forward." The finance minister then agreed to solve the problem of the three-year storage for shipments which are currently held up at customs until Tuesday night, while starting the new two-year system as of Wednesday. Mohamed Haroun, chairman of the country's major cigarette producer Eastern Company, said the old decision would have caused his company to incur more than EPG 4 billion ($223.3 million) in losses annually and the state treasury to lose around EPG 58 billion. Tax proceeds from the tobacco industry to the state treasury are considered the third largest after those from the Suez Canal and the oil sector. | | Golden Pyramids' Profit Drops 44% in H1 2018 Egypt-based Golden Pyramids Plaza said on Wednesday its consolidated profits dwindled 44 percent year on year the first half of 2018 as they were affected by revenues dropping to $68.1 million versus $74.2 million in the year-ago period. Net profits dropped to $18.05 million during the first half of 2018, compared to $32.3 million in the corresponding period last year, the hotel operator said in a bourse filing. Golden Pyramids Plaza previously reported that between January and March, its consolidated profits had declined 57.2 percent year on year to $11.26 million from $26.32 million in the same period last year. Last August, the hotel operator logged $10.36 million in standalone profits for the first three months of 2018, down 52 percent from $21.6 million in the year-ago period. | | Real Estate High-Profile Coalitions to Compete for Managing NUCA's Securitized Bonds A number of coalitions have been formed by Egyptian banks in a race to win a deal to manage and advertise EGP 4.5 billion ($250.6 million) worth of bonds that will be issued by the New Urban Communities Authority (NUCA) to finance the development of new cities. Investment bank EFG Hermes formed a coalition with the Commercial International Bank (CIB) and the Arab African International Bank (AAIB) while finance solutions company Sarwa Capital is joining forces with Banque Misr, Al-Mal newspaper reported. Bids are currently being reviewed to choose the best offer, according to Deputy Housing Minister Khaled Abbas, who said the bonds will finance construction in 20 new cities currently being built nationwide. The new cities that are being developed have a total area of 580,000 acres and are expected to house 30 million people once completed. In 2009, NUCA issued EGP 9 billion ($501.3 million) worth of bonds, a process that was managed by HSBC, the National Bank of Egypt, CIB, Banque Misr Banque Du Caire. | | Real Estate SODIC Decreases Its Expected 2018 Contracts' Value by Over $128 Mn Sixth of October Development and Investment Company (SODIC) has lowered its expected contracts' value in 2018 by over EGP 2.3 billion ($128.3 million), citing a delay in launching a new residential project, according to a bourse filing. The company, which lowered its expected contracts' value from EGP 8.8 billion ($490.8 million) to EGP 6.5 billion ($362.5 million), said that the new value would still be 14 percent higher than that achieved last year. This comes as the launch of SODIC's newest unnamed residential project has been postponed to 2019. Earlier this month, SODIC said it will submit a tender offer to acquire at least 51 percent of Medinet Nasr for Housing and Development (MNHD) through a share swap deal. | | Real Estate Amlak Finance, Marseilia Group to Invest Over $558 Mn in Joint Project AE's Amlak Finance and the Egyptian Marseilia Group will invest around EGP 10 billion ($558.4 million) in a joint residential and retail project in Cairo's Nasr City, Mubasher reported. The two groups signed a Memorandum of Understanding (MoU) last January and are working on finalizing the details of the project, which will include residential and administrative towers as well as a shopping mall and a hotel. The project will span 42,600 square meters of land owned by Amlak, the largest publicly listed Islamic finance company and a leading entity in home finance in the UAE. The project will provide 10,000 job opportunities throughout five years of development. | | Italy Fines Apple, Samsung for Intentionally Slowing Down Phones An Italian Investigation launched by the country's competition authority found Apple and Samsung guilty of "planned obsolescence" of their smartphones and fined them €10 ($11.4) million and €5 million respectively. The firmware updates of the two companies "had caused serious dysfunctions and reduced performance significantly, thereby accelerating the process of replacing them," the watchdog said in a statement, concluding the investigation that started in January. A Samsung spokesman said the company was disappointed by the decision and intends to appeal the fine. "Samsung did not issue any software update that reduced the Galaxy Note 4's performance. In contrast, Samsung has always released software updates enabling our customers to have the best experience possible," the spokesman said. Last year, Apple acknowledged that the iPhone's software had the effect of slowing down some phones with battery problems. However, it denied it had ever done anything to intentionally shorten a product's lifespan. | | The Egyptian King is Back: Salah Reaches 50-Goal Milestone With Liverpool Egypt's effervescent winger Mohamed Salah reached a new milestone with Liverpool, having become the fastest player in the club's history to hit the 50-goal mark after netting a brace in a 4-0 Champions League win over Red Star Belgrade on Wednesday. Salah fired home with his weak right foot in the first half and completed his personal brace after converting a second-half penalty as Liverpool ran riot at Anfield. The 26-year-old achieved the feat in 65 games, surpassing the record held by Albert Stubbins who needed 77 games to hit the 50-goal mark for Liverpool in the 1940s. He also took his tally to 6 goals in 13 appearances in all competitions so far this season. "It's a great record and I'm very proud. I just want to keep scoring and keep helping the team win games," Salah said after the game. Salah set several records in a dream debut campaign with Liverpool last season, including finishing as the Premier League's top scorer with 32 goals. | | SMEs Bill Will be Ready in a Week: SMEDA The micro, small and medium-sized enterprises (SMEs) law is expected to be finally ready within a week or ten days, after which it will be sent to the Egyptian cabinet for review, according to CEO of the Small and Medium Enterprises Development Authority (SMEDA). "The new bill includes financial incentives on projects and in-kind contributions, in addition to credit facilitation that encourages banks to finance technology projects," Nevin Gamea said during the "People and Banks" conference on Wednesday. Egyptian banks have financed 451,000 small and medium-sized projects with EGP 110 ($6.14) billion over the last three years since the Central Bank of Egypt launched its SMEs initiative, Assistant Sub-Governor Nermine El Tahri told reporters on the sidelines of the conference. Launched in 2016, SMEs financing initiative aims to support businesses by easing lending rules and credit facilities. Under the initiative, 20 percent of bank loans should be allocated to SMEs within four years. | | Region Saudi Crown Prince Lauds Qatar's Economy in Unexpected Shift Saudi Crown Prince Mohammed bin Salman praised on Wednesday Qatar's "strong economy," more than a year after his country led an embargo of the tiny state, just as he faces accusations of possible involvement in the killing of Saudi journalist Jamal Khashoggi. "Even Qatar, despite our differences with them, has a very strong economy and will be very different in the next five years," the prince said at an investment summit in the Saudi capital Riyadh as he explained his vision for the Middle East's position in the world. In June 2017, Saudi Arabia, Egypt, the United Arab Emirates and Bahrain severed diplomatic, trade and transport links with Qatar, accusing it of destabilizing the region by supporting Islamist movements. Qatar has since denied the charges and refused to accept a list of 13 demands to normalize relations. The prince, who faced accusations earlier in the day by US President Donald Trump that he could have been involved in the killing of Khashoggi at the Saudi consulate in Istanbul, had only strong words to denounce the murder of the US-based journalist. "First of all, the crime was really painful to all Saudis, and I believe it is painful to every human in the world. It is a heinous crime that cannot be justified," he stated. | | $56 Mn Disbursed Under Takaful and Karama to 2 Mn Families in October Egypt's cash subsidy program Takaful and Karama (Solidary and Dignity) disbursed around EGP 1 billion ($56 million) in October to more than 2 million families that include 10 million individuals, said Minister of Social Solidarity Ghada Wali. Speaking to reporters yesterday, the minister added that 1.9 million families under Takaful scheme received around EPG 948 million, while 291,000 beneficiaries from Karama got EGP 130 million. Earlier this week, the social solidarity ministry requested that the finance ministry disburse an additional EGP 500 ($27.9) million from Takaful and Karama allocations so as to increase the number of beneficiaries. The program currently supports 2.2 million families. The cost of the program since its inception in 2015 is estimated at around EGP 21 ($1.1) billion, of which 85 percent is financed from the state budget and the remaining 15 percent funding is received from the World Bank. The Takaful and Karama program was launched in 2015 to support impoverished families with school-aged children, the elderly and people with special needs, mainly in Upper Egypt. | | Region Saudi Arabia Lifts Ban on Egyptian Guava After New Exportation Rules Saudi Arabia's environment ministry on Wednesday lifted a ban on importing Egyptian guava after Egypt began implementing new exportation rules, an Egyptian official said. "After Saudi Arabia's decision, there are no further hurdles on Egyptian agricultural products in all countries worldwide," Ahmed Al Attar, head of the Agricultural Quarantine Authority, told reporters on Wednesday. In December 2017, the oil-rich Saudi Arabia temporarily banned imports of Egyptian guava due to pesticide residues, which proved to be higher than the global standards limit. Egypt's new rules include presenting export information codes for guava, the exporting companies and packaging locations as well as checking guava shipments, according to a report released by Egypt's agriculture ministry in January. The report said total Egyptian exports of guava stood at 40,188 tons in 2017, with about 18,063 tons destined for European countries. | | Israeli Police Attack Egyptian Monks in Jerusalem A number of Egyptian monks were caught in the violence when Israeli police attacked a protest against the forced Israeli restoration of a Jerusalem monastery, which Copts say belongs to Egypt but Israel says otherwise. Egyptian monks were protesting the restoration work in Al-Sultan monastery, which is currently controlled and managed by the Ethiopian Church in Jerusalem, despite an Israeli high court ruling in 1971 that affirmed the Egyptian Coptic Church's ownership over the monastery. At least one monk was dragged and pinned to the ground by the military police at the protest, while others were struck with batons as they sought to obstruct Israeli workers from carrying restoration materials and tools to the Al-Sultan monastery. Another monk was arrested but later released. Commenting on the unfolding events, Head of the Coptic Orthodox Church Pope Tawadros said in a press statement that what happened "is against human rights law," asserting the Egyptian church's ownership of the monastery. "It is not simply a church-issue, it is an Egypt-issue, and the country's Ministry of Foreign Affairs is working hard to solve the matter," he added. This is not the only recent attack against Christians and their holy sites in Israel. Last week, vandals destroyed 26 gravesites in the of St. Stephen's Church graveyard in the Beit Jamal Monastery. | | Global Economy KSA Says No Penalties Will be Imposed on Foreign Banks Boycotting Investment Summit Saudi Arabia will not penalize foreign banks that boycotted an investment summit in Riyadh due to the murder of Saudi journalist Jamal Khashoggi and they can still obtain banking licenses to operate in the kingdom, the Saudi central bank governor said on Wednesday. "We, at the central bank, deal with local and international banks in a completely professional manner," Saudi Arabian Monetary Authority (SAMA) Governor Ahmed Al-Kholifey told Al Arabiya TV. Saudi Arabia's Future Investment Initiative (FII), which opened on Tuesday, was subdued after Khashoggi's death sparked a boycott by a handful of western politicians, top world bankers and company executives -- resulting in a lower attendance than last year's show. "The Khashoggi story has damaged the reputation of the kingdom and has increased political uncertainty," Garbis Iradian, the chief economist for Middle East and North Africa at the Institute of International Finance, told the CNN on Tuesday. "[Businesses] may postpone or reduce doing business dealings in the kingdom and adopt a wait and see attitude." Despite the fallout, major deals worth over $55 billion in the energy, transportation and petrochemical sectors were announced on the first day of the FII. However, US President Donald Trump said on Tuesday that Saudi Arabia's Crown Prince Mohammed bin Salman bore ultimate responsibility for the operation that led to Khashoggi's killing, describing it as "the worst cover-up ever." Khashoggi, a 59-year-old critic of the crown prince, disappeared after he entered the Saudi consulate in Istanbul on October 2. After Riyadh first denied any involvement in his disappearance, it later said that he had died in a fistfight at the Saudi consulate. | |
