Egypt's annual headline inflation rate rose to 8% in January 2022 | Zilla Capital

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13 Feb 2022

Egypt’s annual headline inflation rate rose to 8% in January 2022

For our top talks today, Egypt’s annual headline inflation rate rose to 8% in January 2022, compared to 4.8% in the same month of 2021. In addition, Egypt consumer prices in cities has risen, on an annual basis, to 7.3% in January, while this rise was 5.9% for the month of December 2021, according to data from the Central Agency for Public Mobilization and Statistics, issued last Thursday. The inflation rate recorded in Egyptian cities during January is the highest in 31 months, when it reached 7.5% in August 2019. The Egyptian Central Bank Inflation target is 7%, increasing or decreasing by two percentage points until the end of 2022. Inflation in Egypt jumped after the state liberalized the exchange rate of the pound at the end of 2016. Inflation figures in cities during January were higher than the expectations of investment banks, which ranged between 6.9-7%. (CAPMAS)

It is worth mentioning that the accelerated inflation is attributed to the increase in prices of the sugar and sugary food segment by 14.7%, the vegetables segment by 4.3%, the dairy products and eggs segment by 2.5%, and the meat and poultry segment by 2.3%.
Moreover, the prices of the grains and bread segment rose by 2%, while the prices of the electricity, gas, and fuel segment increased slightly by 0.2%. On the other hand, prices of the fruits segment and the transport services segment dropped by 0.2% and 0.3%%, respectively. (CAPMAS)
On a different context, the European Bank of Reconstruction and Development (EBRD) announced the signing of a subscription agreement to invest $10 million in Pivotal Holdings Group, a 100%-owned subsidiary of Swvl Inc.
The signed agreement will help in building on Swvl’s solid focus on the safety of women in shared mobility, including safety features such as digital emergency buttons and a one-seat-per-passenger policy. This investment is expected to bolster the development of Swvl’s technology and expansion. (Arab Finance)
Moving to our EGX and companies talks, Despite the 17% increase in its profits, the Egyptian El Sewedy recommends "not to distribute.
The net profit of El Sewedy Electric, the largest Arab cable company, increased by about 17% in 2021 to EGP 3.5 billion, supported by sales growth, especially in the wires and cables sector. The company's board of directors recommended not distributing dividends for 2021, compared to 40 piasters distributed for the profits of 2020. It is worth noting that this is the first time that the company has decided not to distribute annual dividends to shareholders since 2013. The company’s consolidated revenues jumped 30% in 2021, on an annual basis, to 60.5 billion EGP. (Bloomberg Asharq)
Renaissance Capital aims to manage two offerings on the Egyptian Stock Exchange during 2022. Renaissance Capital participated in managing the process of offering Macro Group for Pharmaceuticals,
which raised about 1.3 billion EGP from offering 45.8% of its shares on the EGX at a price of 4.85 EGP per share, and "Hermes" was the global coordinator of the offering. The Egyptian government aims to offer shares of 10 government companies on the stock exchange during 2022, between an initial public offering and a secondary offering, provided that the companies come from various sectors. (Bloomberg Asharq)
Also, EFG Hermes is preparing for 3 proposals on the Egyptian Stock Exchange during 2022, most notably "Bank of Cairo”.
The investment banking company is preparing “Ebtikar” and “Abu Auf” companies for listing on the EGX during 2022, and the group hopes to offer “Bank of Cairo” from government offerings in the same year. The group succeeded during 2021 in participating in a number of "7 proposals in the Gulf markets, this year we will repeat the same achievement, if not more, amid the interest of the Saudi, Dubai and Abu Dhabi markets in the offerings. (Bloomberg Asharq)
Abu Dhabi-based Aldar Properties is planning to invest around 5 billion AED (1.36 billion USD) in 2022 to acquire retail and education assets that generate recurring revenues, according to the company’s chief financial officer (CFO) Greg Fewer.
The CFO did not mention where the investments would be injected, noting that Aldar was focused on the UAE, Egypt, and Saudi Arabia. It is worth mentioning that Aldar previously announced the purchase of a shopping center in Ras Al Khaimah for 410 million AED. (Reuters)
The Egyptian pharmaceutical company, Macro Group, acquired a local company at the end of last year,
and is considering acquiring another company at least in 2022 to develop its business and expansion, according to Ahmed Al-Nayeb, the company’s chairman. Macro raised about 1.3 billion EGP from offering 45.8% of its shares on the EGX at a price of 4.85 EGP per share. The Saudi Public Investment Fund, the financial group "Hermes", the "Franklin Templeton Fund" and funds affiliated with the Abu Dhabi sovereign fund participated in the private placement of the company. (Bloomberg Asharq)
Heliopolis Housing and Development (HHD) (HELI) is planning to launch its first real estate development project in New Heliopolis over a 100-acre land plot in the fourth quarter (Q4) of 2022, according to the CEO of HHD Tamer Nasser.
The company aims at developing integrated projects and selling them as per market’s demands, Nasser said, adding that HDD has nearly 4,700 undeveloped acres in New Heliopolis city. (Arab Finance)
Huawei, a leading global provider of information and communications technology (ICT) solutions, announced that it will take part in the Egypt Petroleum Show "EGYPS 2022”.
EGYPS 2022 is set to take place from February 14th until February 16th under the patronage of President Abdel Fattah El-Sisi. Huawei will participate in the show as the Bronze Sponsor, which comes in line with Huawei’s strategy aiming at offering new solutions and technologies to back digital transformation in the energy sector, as well as support the United Nations Sustainable Development Goals and Egypt vision 2030. The company will also exhibit its vision for clean energy and carbon emissions reduction in light of Egypt’s preparations to host the UN Climate Change Conference (COP27). (Arab Finance)
Tatweer Misr is planning to submit a request to the New Urban Communities Authority (NUCA) to buy a 627-acre land plot in New October city for 4 billion EGP.
The company has been keen on purchasing a land plot in West Cairo to diversify its urban projects portfolio. The NUCA has offered a 627-acre land plot in New October city for sale at a price of 1,570 EGP per square meter (sqm) and Tatweer seeks to get this land in accordance with the direct land allocation system. The real estate developer is intending to establish an integrated urban project in West Cairo that would feature villas and residential units. (Al-Mal)
Nile Developments is planning to invest 13.5 billion EGP in the New Administrative Capital to establish two projects, namely 31 North and Nile Business City, within a four-year period, according to the Chairman Mohamed Taher.
The two projects are set to be delivered in 2025, with target sales of around 24.5 billion EGP. The company aims at pumping investments worth EGP 2 billion in both projects in 2022. 31 North is being established with 2.5 billion EGP in investments, noting that the company is targeting 4.5 billion EGP in sales from it. Meanwhile, Nile Business City comprises five towers at a cost of 11 billion EGP, with expected sales of 20 billion EGP. (Al-Mal)
And finally, the Planning and Budget Committee at the Egyptian House of Representatives announced its final approval on the draft law regarding the amendments to the Income Tax Act issued within Law No.91 of 2005.
The draft law targets cutting the property tax to be fixed tax brackets, instead of calculating it at 2.5% as per the current applied law. Under the first tax bracket, sellers of properties worth up to 250,000 EGP will be taxed a sum of 1,500 EGP. As for the second bracket, sellers of properties worth over 250,000 EGP to 500,000 EGP will be taxed 2,000 EGP. At the level of the third bracket, sellers of properties worth more than 500,000 EGP to 1 million EGP will be taxed an amount of 3,000 EGP. (Al Mal)