As Zilla Capital expected, the Federal Reserve raised the interest rates by 25 bps yesterday as it tries to balance the need to curb inflation without provoking further fears in the banking system

Newsletter

23 Mar 2023

As Zilla Capital expected, the Federal Reserve raised the interest rates by 25 bps yesterday as it tries to balance the need to curb inflation without provoking further fears in the banking system. Most economists and analysts expect the central bank to increase the fed funds target rate range to 4.75-5%, though there remains a chance that officials could choose to pause the tightening cycle in response to the recent turmoil in US banks. The Central Bank of Egypt will be looking at the Fed’s announcement ahead of its monetary policy committee meeting a week from tomorrow. (Bloomberg)

Banking fears have calmed this week following UBS’ emergency takeover of Credit Suisse and action by global central banks to supply liquidity to the financial markets
Global stocks continued to recover from last week’s turmoil, with the S&P 500 climbing 1.3% and commodities recording gains. Safe haven assets like treasuries and gold both sold off. (Bloomberg)
World Bank approves 7 billion USD finance program for Egypt
The World Bank has endorsed a new country partnership framework with Egypt to support development projects in the country with $7 billion in financing for years 2023-2027. The finance program will be implemented by the World Bank, International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA). Under the program, the International Bank for Reconstruction and Development will back Egypt with 1 billion USD annually during the framework period, with an amount of 2 billion USD to be financed by the IFC. (Arab Finance)
B Investments’ board signed off on investing up to 500 million EGP in the Sovereign Fund of Egypt’s (SFE) healthcare & pharma sub-fund.
The SFE and B Investments inked two agreements in January to together invest more than 2 billion EGP into Egypt’s healthcare and pharma local businesses. On the other hand, the Sovereign Fund of Egypt will wait until the end of Ramadan to start taking companies in its pre-IPO fund to market, CEO Ayman Soliman said. (Hapi Journal)
Egyptian Linear Alkyl Benzene (Elab) will be the first company to go to market via the pre-IPO fund
The SFE has not disclosed which other firms have been added to the fund, though Banque du Caire, Misr Life Ins., and Misr Ins. Holding have all been rumored to be included. The two military-owned firms up for sale, Wataniya and Safi, are not part of the fund, Soliman said last week.
In addition, the SFE has added Salhia Investment and Development Company to the fund
It is worth noting that potential investors considering making investments in Egypt are typically most concerned with “how easy it is for them to exit the market and cash out returns on their investments whenever they want to,” Soliman added. Addressing these concerns is linked to reeling in FX resources by pushing through with the state privatization program, delivering on the government’s commitments made to the IMF as part of our USD 3 bn facility, and achieving currency stability. (Al Borsa & Al Arabiya)
Italian energy group Edison expects to make its final investment decision this year on whether to go ahead with a proposed pipeline that will carry natural gas from Israel and Cyprus to Europe
The pipeline would ship 10 bn cubic meters of gas a year from the Mediterranean straight to Greece, and could be operational by 2027. The pipeline will help provide a cheaper and faster method of shipping gas across the Mediterranean than Egypt’s LNG facilities. (Reuters)
Sukari gold mine produces 5.2 million ounces of gold since inception
The Sukari gold mine has produced 5.2 million ounces of gold since it began operations in 2009 until February 2023, with revenues amounting to about 7.5 billion USD. It is the largest off-grid station, dedicated to securing electricity for a mining site in the world. On March 21st, El-Molla announced that trial phase of the commercial production of gold from the Iqat mine in southern Egypt has started. (Ahram Online)
El Gouna launches The Chedi for luxury seekers
El Gouna, a fully-integrated sustainable towns of Orascom Development, has launched The Chedi El Gouna, a five-star beachfront hotel. The launch of the luxurious destination that targets guests seeking lavish experiences at the Red Sea comes in line with El Gouna’s vision to ramp up the Egyptian tourism sector and offer customers first-class amenities. (Arab Finance)
Egypt, Spain ink protocol to establish railway passenger cars’ factory.
Egyptian National Railways (ENR) has signed a cooperation protocol with the Spanish company Talgo to establish the Talgo Egypt factory for the manufacture of railway passenger cars. Minister of Transport Kamel Al Wazir said that this cooperation protocol comes as per the Egyptian President Abdel Fattah El-Sisi's directives to localize heavy industries in Egypt. (Al Mal)