| Egypt, US Trade Exchange Rises 33% in 9 Months The volume of trade exchange between Egypt and the US rose by 33% to around $5 billion during the first nine months of 2018, up from $3.8 billion in the same period last year, said Minister of Trade and Industry Amr Nassar. Egypt's non-oil exports to the US increased by 23.3 percent to $1.1 billion, up from $961 million. Nassar's statements came during a meeting he held with representatives from the US Department of Commerce, who are accompanying a business delegation in a visit to Egypt to explore investment opportunities in the country, especially in pharmaceuticals, energy, foodstuff and financial services sectors. The business delegation will also discuss the future of economic cooperation between the two countries. Meanwhile, President Abdel Fattah El-Sisi met yesterday with the visiting US business delegation which is made up of senior executives of almost 50 American corporations. The meeting was attended by the ministers of investment, petroleum, finance, health, agriculture, communications and trade and industry. "The cooperation between Egypt and the US contributed to Egypt becoming at the top of the list of African countries and the second in the Middle East in trade volume with the US," presidential spokesman Bassam Rady said in statement. Egypt's exports of ready-made garments to the US market, under the QIZ agreement, rose by 15.4 percent to around $559 million in the first eight months of 2018, compared to $484 million in the same period last year, according to the head of Ready-Made Garments Exports Council Mohamed El-Sayyad. | | Egypt Considers Weighing Local Currency Bond on Intl Market: Report Egypt is considering issuing local currency-denominated bonds on the international market to boost overseas inflows, especially after foreign investors have exited emerging markets, including Egypt, in the past few months, according to a Bloomberg report. While investors would purchase the bonds in dollars, the principal and interest would be payable in Egyptian pounds, which means the buyer bears the risk of any fluctuation in the exchange rate, four people familiar with the matter told Bloomberg. The government is in talks with several banks about the possibility of issuing the proposed local-currency bond with a lower yield than on debt issued at home because the transaction can be cleared through Belgium-based settlement company Euroclear, one of the people said. The Central Bank of Egypt (CBE) has sold more than $13 billion in foreign currency-denominated Eurobonds since it lifted most controls on the local currency after floating the Egyptian pound in November 2016. | | Speculation Abound Sukuk Will Be Instrumental in Financing Egypt's Businesses, Infrastructure Sukuk will comprise an alternative for the housing ministry to finance infrastructure projects in the foreseeable future, said Deputy Housing Minister Khaled Abbas during a conference tackling Islamic bonds as a new financing tool for the country's businesses. Karim Helal, Managing Director corporate finance at Carbon Holdings, said Egypt should have tapped into the sukuk market a lot earlier, Al-Masry Al-Youm reported. Last week, Minister of Finance Mohamed Maait told Reuters Egypt plans to issue its first international sovereign sukuk in the 2019/2020 financial year. However, he did not reveal the size of the planned offering. The opening session of Tuesday's event, which was inaugurated by Deputy Finance Minister for Capital Market Khalid Abdel-Rahman, tackled the role of amendments to the capital market law in allowing for new financial products, such as sukuk, and fulfilling the requirements of the Egyptian economy. It also shed light on the role of the General Authority for Investment and Free Zones in promoting unconventional financing instruments. On the sidelines of the event, Mohammed Dawood, HSBC's global head of sukuk financing, said he expects sukuk's overall worth to exceed $3.8 trillion by the end of 2022, according to Amwal Al-Ghad newspaper. In mid-September, Moody's Investor Service said Egypt is one of 18 African countries that have a lot of unexplored potential to tap in the Sukuk market. Egypt is aiming to issue about $20 billion in foreign currency-denominated bonds by 2022. | | Oil & Gas  Egypt Spends Over $1.5 Bn Per Month to Supply Petroleum Products: Minister Egypt's petroleum minister has revealed that the state spends more than $1.5 billion per month on the provision of petroleum products to the local market, with the bill including imports and the share of foreign oil companies. "Egypt now spends $700 million-$800 million to buy the foreign companies' share in local joint venture oil production due to the rise in global oil prices," Tarek El Molla told reporters during a seminar on Tuesday. The Egyptian government aims to cut petroleum subsidies by about 26 percent as the value of subsidies in the new budget stands at EGP 89.1 ($5) billion, down from nearly EGP 121 ($7) billion in the 2017/2018 fiscal year. Brent crude has surged to over $80 per barrel, whereas Egypt's 2018/2019 budget had set an oil price of $67 a barrel. The unsteady rise in crude prices over the past two weeks is increasing perceptions that the global oil market is tightening and could run short in the near future as US sanctions restrict crude exports from Iran. Crude exports from Iran will probably descend to more than 2 million barrels per day (bpd) in August versus a peak of 3.1 million bpd last April, due to pressure from the US to halt orders. | | CIB, Temenos Group, AUC Venture Lab Join Forces to Promote FinTech in Egypt Egypt's largest bank CIB will cooperate with Temenos Group and AUC Venture Lab to boost financial technology in Egypt. In a press conference taking place at the Cairo University on Tuesday, representatives of the three partners expressed willingness to raise awareness over different opportunities and services financial technology makes available in Egypt. Their initiative also aims at coaxing businessmen into establishing companies based on new financial technology, and developing digital services of existing financial institutions. The coalition has demonstrated solutions it offers to Egyptian financial institutions, saying such programs would empower different companies to overcome many market challenges. Representatives stressed that digital solution could help achieve financial inclusion, erase illiteracy or decrease risks, among other benefits. | | Visa's B2B Partners With IBM to Implement Blockchain Cross-border Payments in Q1 2019 Visa's distributed ledger platform, B2B Connect, has partnered with information technology company IBM to implement blockchain cross-border payments as B2B gets ready to launch its services in the first quarter of 2019. B2B Connect aims to be a platform that gives financial institutions a secure, fast and predictable way to process corporate cross-border business-to-business payments. This partnership will allow B2B to use IBM's blockchain code from the Hyperledger Fabric to add additional functionality to the B2B Connect platform. | | EG Gate Seeks to Create 1 Mn Jobs in E-Commerce Egypt's E-business hub EG Gate said it aims to create one million job opportunities, especially to youths, in the e-commerce sector within the next five years. The company is currently working on creating, and later managing, a formal Egyptian e-platform market, where shops can sell their products. "Such an e-platform will help integrate informal economy and increase Egyptian exports," EG Gate CEO Minas Ibrahim told Al-Mal newspaper. EG Gate was founded in 2017 by a cabinet decision, and it falls under the Long Live Egypt Fund, which is used to carry out developmental projects in the country. Unemployment rate among Egypt's population -- estimated at almost 100 million -- fell to 10.6 percent in the first quarter of 2018 to reach 3.9 million, compared to 12 percent in the same period last year, according to figures from the state's statistics body CAPMAS. | | Stock Market El-Sewedy Stock Underpinned by 3 Factors: SHUAA Capital Dubai-based SHUAA Capital said in a report issued yesterday that cable and home appliance manufacturer El-Sewedy Electric is among the fundamentally-strong companies that trade at cheap P/E multiples. The company's stock is currently among the top picks in the market because of three factors, according to the financial services provider. "Firstly, the macroeconomic conditions are on El-Sewedy's side. It is also one of the companies that has always had a solid financial performance and has a proven track record of wise management," SHUAA Capital said in its report. SHUAA Capital believes that the company's strong performance would be sustained but at a rate slower than that of the past four years. It expects El-Sewedy's three segments, namely the cables, turnkey and transformers segments to benefit from the launch of many renewable energy power generation projects, in line with the government's plan to generate 20% of Egypt's energy from renewable resources by 2022. Those segments will also benefit from the subsequent need of power distribution and transmission networks, the report said. Earlier this week, a consortium comprised of Arab Contractors Co. and El-Sewedy Electric won a tender for the construction and design of a hydroelectric power plant and dam in Tanzania. In August, the cable and home appliance producer said that its subsidiary, El Sewedy Electric for Transmission, won two contracts to build electric grids in Mauritania at a combined value of $19.8 million. | | Stock Market Pioneers' Capital Hike Subscribed 2.5 Times in Phase Two Pioneers Holding for Financial Investment said in a filing to the local stock market on Tuesday that the second phase of its capital increase was covered by 2.56 times. Around 11.4 million shares were subscribed to with a 0.39 percent allotment ratio, it noted. The financial services firm earlier said phase one in its capital top-up was 98 percent covered, adding that a total of 211.65 million shares were subscribed to at EGP 5.10 each, totaling EGP 1 billion (around $60 million). The company's board of directors had nodded to a capital increase by 30 percent, or EGP 1 billion ($60 million), in the stock par value plus EGP 0.10 administrative fees. Subscription to the secondary shares was limited to original shareholders, pro rata with capital. "This is the right time to inject more liquidity in new investments or expand existing ones," said Chairman of Pioneers Holding Waleed Zaki. "Such an increase is key to completing the company's future plans and achieving the targeted growth rates." | | No intention of Altering Govt's IPO Plan: Minister Public Enterprise Sector Minister Hesham Tawfik told Masrawy website on Tuesday that the government does not intend make to any changes to its IPO program despite recently postponing it. Egypt's benchmark index EGX30 fell on Sunday by 0.88 percent on the first working day of the week after the government announced that it would postpone its IPO program of over 20 state-owned companies. On Saturday, the government said the public offering of 4.5 percent of the shares of state-owned Eastern Tobacco Company, which was scheduled for the end of October, was put back after an overall weak performance in the emerging markets. The new date of Eastern Tobacco's share offering, which was set to be the first of four state-owned companies that are scheduled to float some of their shares before the end of this year, is yet to be announced. ''The news of the offerings' postponement is certainly one of the reasons for the [index's] fall today because there was a confirmation for the offering and a set timetable,'' Ibrahem Elnemr, head of technical analysis at the Cairo-based Naeem Brokerage, told Reuters A total of 23 state-owned companies and banks are set to be floated on the EGX by the end of 2019. | | PepsiCo Plans to Inject $515 Mn in Egypt Until 2021 PepsiCo Egypt plans to inject $515 million in new investments in Egypt over the next four years, including around $16 million to develop production lines in the beverage sector as it attempts to boost its market dominance in the country.
"[PepsiCo Egypt's] 2018-2021 investment plan is based on three pillars: investment in technology, the agricultural sector and the human element," the company's chairman Mohamed Shelbaya told a news conference on Tuesday. "The company intends to invest $16 million in technology and the agricultural sector in order to develop the production lines of Pepsi and Aquafina." Shelbaya also revealed that PepsiCo's investments in the Egyptian market totaled $660 million between 2014 and 2017, saying that the firm considers Egypt among the region's top markets for investment. Meanwhile, Egypt's Investment Minister Sahar Nasr met on Tuesday with representatives of 44 companies from the US to discuss new investment opportunities, including PepsiCo that seeks to expand its product portfolio in the country, according to a statement from the ministry. | | SICO Seeks to Boost Production Capacity Within Three Months Silicon Industries Corporation (SICO), Egypt's first smartphone maker, aims to boost its production capacity within three months to 150,000 devices per month versus a current monthly rate of 80,000 devices, the company's CEO Mohamed Salem said on Tuesday. The smartphone maker, which has a sales target of EGP 2.6 billion ($145 million) for 2020, plans to introduce new smart devices in 2019 by offering a total of 11 products, Salem told Al Mal newspaper. SICO currently offers seven products. "SICO exports its products to seven Arab countries, including the UAE and Saudi Arabia, as well as five centers that provide maintenance and technical support services in the region," he said. "The company seeks to expand into East African markets such as Kenya and Tanzania." According to the Salem, SICO also plans to increase the local components used in the production of its devices to 70 percent from 45 percent. Launched in 2017, SICO was set up with a capital of $8.4 million, of which the Egyptian communication ministry owns 20 percent while the remaining 80 percent is held by private investors. | | Ezz Steel Signs $140 Mn Syndicate Loan with Five Banks Ezz Steel has signed an EGP 2.5 billion ($140 million) syndicated loan with five banks to increase its capital, a source told Al-Mal newspaper. The banks, according to the source, include the National Bank of Egypt, Banque Misr, Banque Du Caire and the Suez Canal Bank. The company has a number of manufacturing facilities across the country, with a total manufacturing capacity of 5.8 million tons of finished steel annually. | | Region Orascom Road Construction to Work on Libyan Highway Project by Q1 2019 Orascom Road Construction will begin working on its 150-kilometer section of the Libyan Coastal Highway, between Benghazi and Salum, by the first quarter of 2019, the company's CEO said. "Along with Egyptian contractors Hassan Allam and Samcrete, Orascom was awarded the building contract of a 400-kilometer section of the Libyan highway," Safwat Sobhy told Al Borsa newspaper on Tuesday. In 2013, Italy and Libya signed a bilateral agreement to build a new 1,700-kilometer coastal highway crossing Libya from east to west -- the Libyan Coastal Highway. "The project's cost was set at €5 ($5.7) billion in 2013 and was raised to €8 ($9.2) billion, following the price hikes of recent years," Sobhy explained. The CEO also revealed that "Orascom has finalized 80 percent of the due roadworks at the New Administrative Capital east Cairo, at a total cost of EGP 3 billion (around $168 million)." "The company is also currently carrying out a 250-kilometer El Tor road project in [Red Sea resort of] Sharm El Sheikh, which is scheduled for completion by year-end," he added. | | Oil & Gas AMOC, Midor Sign Trade Cooperation Agreement Alexandria Mineral Oils Company (AMOC) has signed a trade cooperation agreement with Middle East Oil Refinery (MIDOR) that will help AMOC increase its revenues and reverse a recent drop in its profits, according to a company bourse filing. MIDOR will refine some of AMOC's oil products, so that they can meet international standards and be sold for higher prices. AMOC will use the hard currency it generates from exporting Mazut products to finance this process, the agreement stipulates. Earlier this week, AMOC said its profits fell during the first three months of the 2018/2019 fiscal year, from July to September, to EGP 253.1 ($14.1) million, down from EGP 402.6 ($22.5) million in the same period last year. The state-owned company said one of the reasons for the decrease in profits is the extra costs of mixing the exported mazut with diesel to improve its quality. | | Real Estate Marseilia Group Targets $167 Mn in Sales in 2019: CEO Egypt-based real estate developer Marseilia Group is targeting an EGP 3 billion (nearly $167 million) in sales via its property projects in 2019, the company's CEO said. "The company has already injected EGP 800 ($45) million in investments in 2018 and is seeking to acquire three land plots in 2019 in order to establish a 120-acre project in Egypt's North Coast," Sherif Heliw told Mubasher news website on Tuesday. "Marseilia is also looking to acquire a 15,000-meter plot in Alexandria and another covering 40,000 acres in Cairo," Heliw added, noting that the company is currently in talks to lay hands on a land plot in the New Administrative Capital east of Cairo. The real estate developer has generated sales of EGP 1 billion so far this year. | | International Egypt FM Meets Saudi King as KSA Remains in Hot Water Over Khashoggi's Death Egyptian Foreign Minister Sameh Shoukry met with Saudi King Salman on Tuesday as the oil-rich country remains in hot water in the aftermath of the killing of Saudi journalist Jamal Khashoggi. Shoukry's visit aims to deliver a presidential message that "tackles means of fostering bilateral relations and enhancing coordination and consultation on regional issues of mutual concern," according to a ministerial statement, which did not explicitly refer to the Khashoggi case. Khashoggi, a 59-year-old critic of the Crown Prince Mohammed bin Salman, 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. Meanwhile, Saudi Arabia's top investment summit, 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. "[Businesses] may postpone or reduce doing business dealings in the kingdom and adopt a wait and see attitude." However, Turkey has cast a fresh pall on the case after President Recep Tayyip Erdogan said he will reveal the "naked truth", saying he has strong evidence Khashoggi was killed in a "premeditated and savage murder." Erdogan also called on the Saudi king to allow Turkey to try 18 people suspected of murdering Khashoggi in Istanbul. | | Egypt's Railway Cargo to Hit 25 Mn Ton by 2025: Minister New mechanisms have been introduced to boost the contribution of Egypt's railway network to the cargo transport to 25 million tons by 2025, said Transport Minister Hisham Arafat. Speaking to a meeting of Arab transport ministers in Alexandria, Arafat added that the ministry had upgraded the signaling system over a distance of 1100 km in the railway network to achieve the highest safety levels. He noted that the railway fleet has been renovated through the supply of 200 locomotives and 1300 train carriages. He also highlighted a plan to expand the metro lines network to 113 km by 2022 and 210 km by 2030. Arafat also stressed that the development of Suez Canal zone will "open new horizons for the country's future development and achieve maximum utilization of Egypt's strategic location." "The implementation of mega investment projects in ports, such as the multi-purpose terminals at Alexandria, Damietta, Safaga, Nuweiba will reflect positively on the national economy," he added. Late in September, the National Railway Authority signed an agreement worth 1.2 billion euros with a Russian-Hungarian consortium to import and manufacture 1,300 new railway carriages, the largest deal in the history of Egypt's railways. | | Prices of Frozen Poultry, Meat Will Be Slashed: Minister Egypt has decided to slash the prices of frozen poultry and meat in an effort to provide food commodities at reasonable prices for citizens. "The prices of frozen poultry will be reduced by EGP 2 ($0.11) per kilo to be sold at EGP 38 ($2.12) instead of EGP 40, while frozen meat prices will be lowered by EGP 3 ($0.17) per kilo to be sold for EGP 60 ($3.35) instead of EGP 63," Minister of Supply and Internal Trade Ali Moselhy said in a statement on Tuesday. "Sheep meat will still be provided at EGP 95 ($5.3) and Sudanese fresh beef at EGP 90. The listed food commodities will be available at all branches of the consumer complexes that are affiliated to the Food Industries Holding Company (FIHC)." In its statement, the ministry denied that it would raise prices of frozen poultry in consumer complexes by 19 percent after prohibiting the trading and unlicensed selling of live poultry in six governorates. On October 10, the agriculture ministry put into effect a 2009 law banning the trade of live poultry and requiring its transition directly to licensed slaughterhouses after traders acquire certain authorizations following veterinary inspection. "As a first phase, the ministry will ban the trading of live poultry in the capital Cairo and the neighboring city of Giza, which consume 30 percent of the country's poultry," Mona Mehrez, deputy agriculture minister for livestock and poultry production, said earlier in a statement. | | Six Universities to Be Inaugurated in New Alamein Next Year Six universities will open their doors to students in New Alamein City in September 2019 as the city steadily takes shape. The government has also recently offered 2 million meters of industrial land for sale in the city, located on the country's north-western coast, Deputy Housing Minister Khaled Abbas said in a conference on Tuesday. The city, which meant to be a first home destination, is built on an area of 50,000 acres and is set to accommodate around 3 million inhabitants when the first phase is completed. | | Region Egypt, Sudan to Sign Railroad Agreement During Sisi Visit Egypt and Sudan are scheduled to sign a railroad map connecting the two countries together during President Abdel Fattah El-Sisi's visit, which starts on Thursday. The planned railroad is set to begin from Alexandria's Sidi Gaber Station to Khartoum, Sudan's Transportation Minister Hatem El-Ser told Al-Borsa newspapers. The project's funding is yet to be determined, according to El-Ser, who described this issue as the only obstacle facing the project, and which El-Sisi and his Sudanese counterpart Omar Al-Bashir will discuss during the visit. Egypt is currently working on expanding its own railroad network by 272 kilometers by 2020, Transportation Minister Hesham Arafat said in a statement on Tuesday. | | Ahly Through to 2nd Straight Champions League Final Despite Loss in Algeria Egyptian giants Ahly suffered a 2-1 loss at Algeria's ES Setif on Tuesday but still managed to qualify for the African Champions League final for the second year running as they target a record-extending ninth triumph. Ahly, protecting a comfortable 2-0 first-leg advantage in the semi final, thought the game was dead and buried when winger Walid Soliman raced clear to score and stun the home crowd just past the hour mark. However, they endured some nervy moments after Setif threatened to stage a remarkable comeback with two goals from Mohamed Bakir and Hossammadine Chacha. Needing two more goals to advance, Setif mounted a late onslaught but Ahly held on to reach the final for a record 12th time with a 3-2 aggregate win. The Red Devils will face Esperance in a mouthwatering two-legged final after the Tunisian side beat Angola's Primeiro de Agosto 4-2 in a thriller for a 4-3 aggregate victory. Ahly won the last of their record eight Champions League titles in 2013. | | Only Three Weeks Left Before Expiry of Tax Exemption Law: ETA The Egyptian Tax Authority (ETA) has confirmed that only 21 days are left for exempting financiers and investors from paying up to 90 percent of interest on late payments and tax penalties as part of the government's initiative to ease the burden on taxpayers. "Taxpayers will be exempted from paying the penalty for delay until November 14 only," ETA said in a statement on Tuesday. "This opportunity will not be offered again," the statement added. On August 15, the Egyptian government issued a new law that reduces penalties for late tax payments by a certain percentage based on the date of payment, including stamp duties, income tax and development fees. The law comes in line with the government's efforts to facilitate the work of various sectors, including the industrial and investment ones. | |
