Egypt records a primary surplus of 164.3B EGP in fiscal year 2022/23

Newsletter

17 Jul 2023

Egypt records a primary surplus of 164.3B EGP in fiscal year 2022/23. Egypt has reported a primary surplus of 164.3 billion EGP, equivalent to 1.7% of GDP, for FY 2022/23, despite a 16.3% increase in public spending and an 11.5% rise in revenues, Finance Minister Mohamed Maait announced. The total deficit was slightly up at 6.2%, compared to 6.1% in the previous fiscal year. Maait noted the debt ratio was affected by exchange rate fluctuations and is expected to fall to between 75% and 79% of GDP over the next four years. Egypt aims for economic growth of 4.1%-4.2% in 2023, according to Minister of Planning and Economic Development Hala Elsaid. (Arab Finance)

Egypt and Ethiopia reach consensus to settle GERD conflict.
President Abdel Fattah El Sisi of Egypt and Prime Minister Abiy Ahmed of Ethiopia had a promising meeting last week in Cairo, showcasing potential for progress. Both leaders have reached a mutual understanding to find a solution to the long-standing GERD issue within the next four months. They aim to create an agreement that supports Ethiopia's power generation needs without compromising Egypt's water security (Enterprise)
IMF supports Egypt's initiative of transferring $1.9B assets to private sector.
The International Monetary Fund (IMF) has lauded Egypt's sale of $1.9 billion in state-owned stakes, terming it a key part of the Extended Fund Facility (EFF) program, aimed at reducing external debt and improving resources. This followed the announcement by Prime Minister Mostafa Madbouly about the signing of contracts with the private sector to sell state assets under the initial public offering (IPO) program. In December 2022, the IMF had granted Egypt a 46-month arrangement amounting to $3 billion under the EFF. (Arab Finance)
Egyptian Kuwaiti holding channels 1.4 billion EGP towards new factory establishment and production line expansions.
Egyptian Kuwaiti Holding Company has disclosed the inauguration of new factories and the completion of production line expansions in its subsidiary, Sprea Misr, at an investment cost of 1.4 billion EGP ($46 million). These fresh investments are expected to favorably influence the consolidated business results. During Q1 2023, Sprea Misr reported a net profit of $34 million, marking a 97% growth compared to Q1 2022. Overall, Egyptian Kuwaiti Holding recorded a net profit of $65 million in Q1 2023. (Al Mal)
CI Capital to issue 15 billion EGP securitization bonds on behalf of Urban Communities.
CI Capital has successfully issued 15 billion EGP in securitization bonds for the New Urban Communities Authority, distributed across four tranches with differing values and maturity periods. All tranches received high credit ratings from Meris Middle East. This operation marks CI Capital's seventh transaction this year, totaling about 27 billion EGP in value. The company's CEO, Amr Helal, and Debt Markets Department Head, Mohamed Abbas, have both expressed the increasing importance of debt issuances in the Egyptian market as a beneficial alternative to traditional financing. (Economy Plus)
EU reinstates customs duties on ammonia and urea imports, responding to Egyptian requests.
The European Union (EU) has reinstated customs duties on its imports of ammonia and urea, following Egypt's request earlier this year. The move aims to protect the competitiveness of Egyptian products in EU markets and to ensure fair trading under the Egyptian-European partnership agreement. The EU imposes tariffs of 5.5% on ammonia and 6.5% on urea, generating annual customs revenue of around €15 million. This comes from the EU's yearly import of approximately 2.9 million tons of ammonia and 4.7 million tons of urea. (Economy Plus)
Expected outcomes of financial regulatory decisions include drawing in fresh participants and enhancing financial literacy.
Company executives and stakeholders in the capital market regard the Financial Supervisory Authority's three executive decisions to implement Law No. 5 of 2022, governing non-banking financial technology usage, as positive, according to a survey conducted by Hapi newspaper. They believe these decisions respond well to market demands. (Arab Finance)
Egypt and AIIB sign a financing deal worth €250m for the development of Abu Qir metro.
Egypt's International Cooperation Ministry has struck a €250 million financing deal with the Asian Infrastructure Investment Bank (AIIB) for the upgrade of Alexandria's Abu Qir Metro. The project, estimated at €1.5 billion, receives co-funding from several international entities, including the EBRD, EIB, and AFD. The ministry also partnered with the China International Development Cooperation Agency (CIDCA) on four initiatives encompassing transport, vocational training, health, and a strategy to bolster Egypt-China cooperation over the next three to five years. The total Egypt-China cooperation portfolio, targeting areas like health, education, and electricity, stands at around $1.7 billion. (Arab Finance)
Qalaa Holdings reports a 62% annual increase in consolidated revenues for Q1.
Qalaa Holdings reported a 62% YoY surge in consolidated revenues, reaching EGP 30.3 billion in Q1 2023 from EGP 18.7 billion in the prior year. Excluding ERC, group revenues rose by 38% YoY to EGP 6.9 billion. However, net profits after tax and minority interest fell by 84% YoY to EGP 73 million. The company's standalone net losses after tax also increased, reaching EGP 927.775 million in Q1 2023. Qalaa Holdings, a private equity firm, manages a diverse investment portfolio across multiple sectors. (Arab Finance)
Egypt prolongs export prohibition on oxygen for an additional year.
Egypt has prolonged its prohibition on exporting oxygen for another year from mid-July, with exceptions only granted through approval from both the Ministry of Health and the Ministry of Trade and Industry. Trade Minister Ahmed Samir affirmed that this decision aligns with the country's strategy to ensure hospitals and medical establishments have adequate oxygen supplies. (Arab Finance)