Finance Minister announces measures to waive fines for oil companies and boost exports

Newsletter

08 Aug 2023

Finance Minister announces measures to waive fines for oil companies and boost exports. Dr. Mohamed Maait, Egypt’s Finance Minister, has made amendments to the Customs Law’s executive regulations to simplify procedures and reduce customs release time. The goal is to position Egypt as a regional hub for transit trade, stimulate exports, and facilitate trade, thus bolstering the Egyptian economy. New measures include electronically submitting customs declarations for incoming goods upon unloading unless they’re stored in approved customs locations. The updates also promote direct transit trade by accepting insurance documents as a viable customs guarantee, replacing the sole reliance on cash or bank guarantees. This change aims to streamline processes for businesses and clarify the “direct transit” concept. (Hapi Journal)

Higher interest rates add to the challenges faced by Egyptian companies.
Since March 2022, local currency return rates in Egypt have surged by around 1,100 basis points, stressing companies and hampering their financing abilities for investments and operations. Analysts believe this has deeply affected the production sector due to its prolonged nature, disrupting companies' investment and expansion plans. Additionally, companies are increasingly relying on bank overdrafts for operational needs, making production costs rise with every interest rate hike. Contrary to expectations, the Central Bank of Egypt recently raised interest rates, with overnight deposits and lending rates now standing at 19.25% and 20.25%, respectively, a significant jump from 8.25% and 9.25% just 18 months ago. (Asharq)
Egypt and Jordan ink 12 agreements to enhance collaboration across various sectors.
Egypt and Jordan, during the 31st session of their Joint Committee, signed 12 memoranda of understanding (MoUs) to strengthen bilateral relations across various sectors. Key agreements include collaboration on economic development, securities regulation, environmental programs, and social affairs. They also inked deals on media exchange between Jordan's Petra and Egypt's MENA news agencies, cultural and technical cooperation, manpower, and insurance. Both nations are also aiming to enhance health services and further ties between their respective ministries of Awqaf. Additionally, Egypt Post and Jordan Post sealed an agreement on e-postal payment services. (Arab Finance)
Egypt distributes $183M worth of corn and soybean feed in a fortnight.
From July 20th to August 3rd, Egypt distributed 378,000 tons of corn and soybean fodder, totaling $183 million, as announced by the Minister of Agriculture, Al-Sayed El-Quseir. This included $101 million worth of corn and $73 million in soybeans. Since October 16th, 2022, Egypt has released 7 million tons of fodder, valued at $3.3 billion, comprising 5 million tons of corn and 2 million tons of soybeans and additives. (Arab Finance)
Heliopolis plans to offer Helio Park land at a reduced price to a domestic buyer.
The company "Heliopolis for Housing and Development" plans to sell its "Helio Park" land to a local investor for a cash payment, offering a discount of up to 40%. Last year, the government-affiliated company considered an offer to sell this land, though it didn't disclose the bidder's identity. The land, spanning 1,695 acres, is situated between the "Al-Rehab" and "Madinaty" projects. An insider mentioned the offer was cash-based and not in installments, leading to a potential 40% discount. The "Holding Company for Construction and Development" owns roughly 72.25% of "Heliopolis for Housing and Development. (Asharq)
Al Ezz Dekheila Steel approves stock repurchase and exits EGX.
The general assembly of Al Ezz Dekheila Steel has endorsed the decision to voluntarily delist from the EGX. Additionally, the assembly gave the green light for the acquisition of a 31% stake previously held by government entities, aligning with government privatization efforts. Parent company Ezz Steel has agreed to provide a payment guarantee up to USD 250 mn to support the delisting. All freefloat shares acquired from the government will be retired by Al Ezz Dekheila, allowing Ezz Steel to have near-total, if not complete, ownership of the now-private firm. (Enterprise)
Cairo's Buguard secures $500,000 in initial funding phase.
Egyptian cybersecurity firm Buguard secured $500,000 in seed funding, as announced in a press release to Arab Finance. The round, led by A15 and joined by angel investors, aims to expand the team, enhance products, and boost sales and partnerships. Buguard's CTO, Youssef Mohamed, emphasized their global presence and future plans to strengthen their foothold in the GCC, particularly eyeing expansion into Saudi Arabia in 2023. (Arab Finance)
Egypt's gold holdings reach $7.97B in July.
Egypt's gold reserves increased to $7.974 billion in July, up from $7.738 billion in June, as per the Central Bank of Egypt (CBE). The balance of Egypt's special drawing rights (SDRs) also saw a significant rise, reaching $376 million in July from just $27 million in June. Additionally, the country's net international reserves (NIR) slightly rose to $34.879 billion in July from $34.806 billion the previous month. (Arab Finance)
GAFI awards 22 firms with golden licenses to date.
The CEO of the General Authority for Investment and Free Zones (GAFI), Hossam Heiba, revealed on August 7th that 22 companies have been granted golden licenses, with more to be issued. Additionally, GAFI plans to introduce its e-incorporation service soon. These announcements were made during a discussion between Heiba and Ismailia's governor about investment prospects in the East Canal Zone. (Arab Finance)
Saudi Aramco to distribute 98% of earnings to its shareholders.
Saudi Aramco will distribute cash dividends totaling 110.2 billion riyals ($29.4 billion) to shareholders for Q2 2023, which represents 97.7% of its quarterly profits. The eligibility cut-off is set for September 10, and only those registered in the company's shareholder register by the end of the second trading day after the due date will qualify. The dividends comprise 73.16 billion riyals ($29.4 billion) in basic dividends and an additional 37.02 billion riyals ($9.9 billion) in performance-related dividends. This marks the first time Aramco is implementing its performance-related dividend distribution policy. (Hapi Journal)