Daylight savings is coming this Friday

Newsletter

27 Apr 2023

Daylight savings is coming this Friday. Friday, 28 April, will be the first day of daylight savings — our first since 2016 — which will see Cairo Local Time (CLT) pushed forward by one hour. Daylight savings will remain in effect until 11:59pm on Thursday, 26 October. The move, which breezed through the House of Representatives earlier this month, was made with an eye towards potentially cutting down our natural gas consumption. Get ready for some semi-jet lagged confusion and tardiness. (Hapi Journal)

S&P Global Ratings has cut its outlook on Egypt’s debt to negative,
warning that the country risks not being able to meet its external funding needs if it doesn’t deliver on economic reforms tied to its IMF assistance program. The downbeat forecast “reflects risks that the policy measures implemented by the Egyptian authorities may be insufficient to stabilize the exchange rate and attract foreign currency inflows,” the ratings agency said in its latest review on Friday, which held the country’s credit rating at B. (Bloomberg)
Moreover, S&P estimates our external financing needs at 17 billion USD for FY 2022-2023 and 20 billion USD for the following year, with 26 billion USD of this required to finance the current account deficit.
The ratings agency currently expects these requirements to “largely be met,” with almost 10 billion USD in FDI and the remainder to come from GCC investment, portfolio flows and fresh borrowing. “We assume that any external funding gaps will be covered by additional GCC government support,” S&P wrote. (Bloomberg)
The ratings agency expects the EGP to decline 53% in FY 2022-2023 and to continue to drop slightly in the following years.
The official exchange rate has remained little changed since early March amid a continued shortage of foreign currency, causing the rate in the parallel market to widen and raising speculation that the central bank will have to further devalue the currency. The currency has fallen around 39% so far this year. (Bloomberg)
It is worth remembering that Bloomberg reported earlier this month that the IMF will not go ahead with the first review of the loan program until authorities begin selling down state assets and transition to a flexible exchange rate.
The review was initially scheduled to take place in mid-March. All three of the major ratings agencies have now issued warnings on Egypt’s debt sustainability in recent months, with Moody’s downgrading Egypt’s rating for the first time since 2013 in February and Fitch cutting its outlook to negative in November. (Bloomberg)
Egypt's hotel occupancy grows 25% in Q1 2023.
Hotel occupancy in Egypt increased by about 20%-25% during the first quarter (Q1) of 2023, compared to the same period last year, supported by the diversity of expatriate markets to the country and the depreciation of the Egyptian pound. Sharm El-Sheikh’s hotels occupancy hit 55%, 65% in Hurghada, Marsa Alam 70%, 80% in Luxor and Aswan, and 85% in Cairo. Tourists form Germany, Poland, Italy, Britain and the Czech Republic were the most nationalities that visited the Egyptian resorts. On March 27th, Minister of Tourism and Antiquities Ahmed Issa unveiled a new package of facilities related to issuing tourist visas. (Asharq Business )
El-Sisi orders increasing social protection budget to 529.7 billion EGP.
President Abdel Fattah El-Sisi ordered raising the social protection budget from 358.4 billion EGP to 529.7 billion EGP, with an increase of 48.8%, to alleviate burden on citizens due to the persisting soaring inflation. In the amended social protection budget, 127.7 billion EGP has been allocated to support food commodities for the upcoming fiscal year (FY) 2023/24, at an annual growth rate of 41.9%, up from 90 billion EGP allocated for the current FY. (Arab Finance)
Saudi ACWA Power’s Egypt solar project secures 123 million financing.
Saudi Arabian integrated utility developer ACWA Power, partly owned by the Public Investment Fund (PIF), has signed a 123 million USD financing package to develop the 200MW Kom Ombo solar project in Egypt. The package comprises loans of up to 36 million USD from the EBRD, 14.6 million USD from the OPEC Fund, 14.4 million USD from the AfDB, 34.5 million USD from the GCF, 14.8 million USD from Arab Bank and 10 million USD from the SEFA under the COVID-19 IPP relief program. (Zawya)
The Madbouly government is in talks with unnamed private Egyptian and Indian pharma companies to establish an 80 million USD pharma raw materials plant,
Public Enterprises Minister Mahmoud Esmat said. The project will work to meet local demand and boost exports. It is worth noting that state-owned pharma manufacturer HoldiPharma plans to build five new factories at a cost around EGP 2.5 bn in partnership with private-sector firms, including an unnamed Indian manufacturer that will act as technical expert. (Asharq Business)
Egypt, Greece to launch periodic dialogue on financial issues.
Egyptian Finance Minister Mohamed Maait signed a Memorandum of Understanding (MoU) with his Greek counterpart to launch a joint periodic dialogue to exchange views on issues of financial policies. Maait expressed his country’s keenness to enhance cooperation with the Greek side in various fields, shedding light on several joint projects that could make Greece a gateway for exporting green energy from Egypt to Europe. On April 18th, Maait revealed that the government is looking forward to officially launching the Sustainable Debt Alliance in Egypt by September 2023. (Arab Finance)