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As Zilla Capital Expected, the Central Bank of Egypt kept the interest rates unchanged last Thursday

Morning Talks
As Zilla Capital Expected, the Central Bank of Egypt (CBE) kept the interest rates unchanged last Thursday, following the Federal Reserve’s decision to leave interest rates also unchanged. For Egypt, the main two reasons behind holding rates steady are, firstly, the latest inflation rates came last month less than expected, and the second reason is that the exchange rate is stable, whether in the official or parallel market. The overnight deposit rate stands at 19.25%, while the overnight lending rate is 20.25%, and the main operation and disc. rates are at 19.75%. The central bank has increased rates by 1.1k bps since March 2022, with 300 bps of hikes coming this year. The MPC last raised rates in August when it decided on a 100-bps hike. (Zilla Capital)
  1. The US Federal Reserve decided to leave interest rates unchanged but signaled that policy will remain tight for longer amid the continuing strength of the economy. 
    Most Fed officials expect to need to lift its benchmark rate by another 25 bps to 5.5%-5.75% this year, though Fed chair Jerome Powell made sure to emphasize that the central bank will “proceed carefully” with any further hikes. The meeting came on the heels of August data that showed inflation picking up again, raising expectations in some quarters that rates may need to move higher than currently though, especially in light of the recent surge in oil prices. (Asharq Business)

  2. On the other hand, Egypt upgrades GDP growth forecast for 2 FYs. 
    The Egyptian government has raised the state’s gross domestic product (GDP) growth target to 4.4% for the current fiscal year (FY) 2023/2024, from a previous projection of 4.1%. Moreover, Egypt has upgraded its GDP growth target for the next FY of 2024/2025 to 5%, up from a previous estimate of 4.7%. This upgrade in Egypt’s economic growth target has been backed by the real estate and infrastructure sectors. (Asharq Business)

  3. Egypt to establish tyre factory with 1 billion EUR investment.
    The Egyptian government has made a significant step towards bolstering its manufacturing sector by announcing plans to establish a tyre factory in the Suez Canal Economic Zone. This venture is set to be worth 1 billion euros, equating to approximately 1.07 billion USD. The move was made public in a cabinet statement released on Wednesday. The factory is part of a contract signed with Rolling Plus for chemical industries, a consortium whose shareholders include Egyptian, Saudi, and Cypriot companies. It will have the capacity to produce an impressive 7 million tyres annually. (Al Mal)

  4. The International Finance Corporation (IFC) are considering extending 125 million USD loan to Egypt to fund the construction of Damietta Port’s second container terminal. 
    The board is expected to make a final decision on the facility on 30 October. The funding is part of a 455 million USD financing package involving the IFC, the European Bank for Reconstruction and Development (EBRD), the Asian Infrastructure Investment Bank (AIIB), Deutsche Investitions und Entwicklungsgesellschaft (DEG), and the French Development Agency’s private-sector investment arm Proparco. The AIIB is chipping in 100 million USD, and EBRD announced funding the project with 125 million USD last month. (Enterprise)

  5. Moving to the Education sector, KOICA and Egypt forged an 8 million USD deal to boost Beni-Suef Technological University's capacities, aiming to provide the Egyptian labor market with skilled manpower. 
    The Korea International Cooperation Agency (KOICA) and the Egyptian Ministry of Higher Education and International Cooperation have signed an agreement on a project termed 'Enhancing the Educational Capacity and University-Industry Cooperation of Beni-Suef Technological University'. The project includes the development of an innovative industry-specific curriculum for ICT, Mechatronics, Autotronics, and newly established Railway Technologies departments. (Egypt Business Daily News)

  6. In addition, CIRA Education saw a net increase in enrolment numbers of around 5k students across its facilities for the 2023-2024 academic year which is 25% more than its previous annual record. 
    The education provider admitted some 11k new students in total across its two universities and 27 schools. Of the new intake, some 3.5k students came from the higher education segment, while the remaining 1.5k came from the K-12 segment. (Al Mal)

  7. For the oil and gas sector, Kuwait’s KUFPEC acquires 40% in Shell Egypt’s Nile Delta offshore block 
    Kuwait Foreign Petroleum Exploration Company (KUFPEC) signed an agreement with BG International, a subsidiary of Shell. Shell Egypt has been operating in Egypt for 100 years. Today, most of the company’s operations are located in the Western Desert and Nile Delta. KUFPEC started its first production in Egypt in the Western Desert in mid-2007. Egypt is working to maximize its energy resources to meet domestic demand and position itself as an energy hub. (Egypt Business daily News)

  8. It is worth mentioning that the government announced in August a plan to drill 45 natural exploratory gas wells in the Mediterranean and the Nile Delta with 1.9 billion USD in investments until mid-2025.
    Similarly, global energy giant British Petroleum (BP) plans to invest 3.5 billion USD in the exploration and development of natural gas resources in Egypt over the next three years. The country expects to produce about eight million tons of liquefied natural gas (LNG) in 2023 after discovering a new gas field in the Nargis area in January. (Egypt Business Daily News)

  9. Moreover, Egypt Grants Golden License for Electric Vehicles & Gas Expansion Projects.
    This expansion will span about 33 acres within the Renaissance Industrial Zone in Al-Amiriya, Alexandria Governorate. The Egyptian Natural Gas Company, Jasco, has been granted a Golden License for its project to increase the capacity of the Western Desert Gas Complex with a fourth production line, designed to produce 600 million cubic feet per day. The project, estimated at around 380 million USD, is expected to create employment opportunities for about 2,500 local workers. (Egypt Business Daily News)

  10. And for startups news, Egypt’s Health Insurance Startup Sehatech Garners 850,000 USD in Funding.
    In the rapidly digitizing world, Sehatech, an emerging health insurance startup from Egypt, has successfully clinched funding of 850,000 USD. This financial boost comes courtesy of A15 and Beltone Venture Capital, a subsidiary of the Beltone Holding Company. Sehatech’s primary objective is to harness its unique technology to streamline and digitize the interactions between insurance companies and healthcare providers. This includes processes like claim submissions and approval management, often termed third-party administration (TPA) within the healthcare sector. (Egypt Business Daily News)

  11. Finally, the real estate developer Al Ahly Sabbour is at the final stages in setting up a presence in Saudi Arabia.
    The developer inked a cooperation agreement with Saudi’s National Housing Services Company to set up a real estate project in Riyadh, the details of which were not disclosed. The General Authority for Investment and Freezones (GAFI) and the Financial Regulatory Authority are reportedly mulling changes to real estate fund law, aimed at encouraging the launch of more real estate funds. (Asharq Business & Al Borsa)

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