Cabinet approves additional incentive for wheat farmers

Newsletter

13 Apr 2023

Cabinet approves additional incentive for wheat farmers. The Egyptian cabinet approved an additional incentive to supply wheat from farmers for the 2023 season, bringing the price of wheat to 1,500 EGP per ardeb of 23.5 carats. This decision comes in implementation of the directives of President Abdel Fattah El-Sisi to revise the supply price of wheat for farmers in the current harvest season. On January 19th, Prime Minister Mostafa Madbouly said that the cost of wheat subsidies would increase to 95 billion EGP by the end of the year, up from 38 billion EGP. (Bloomberg Asharq)

Office rents in Egypt will fall by 30% this year in USD terms as challenging economic conditions dampen demand for office space.
The country’s commercial real estate sector will face pressure this year as higher borrowing costs, soaring inflation, and slowing economic growth weigh on businesses. Average monthly rents in Alexandria will fall almost 36% y-o-y to 8.20 USD per sqm. Monthly rents in Cairo, where demand is greatest and rents are highest, are expected to drop more than 30% y-o-y to 17.40 USD per sqm. Rents in Giza will fall almost 32% y-o-y to 9.30 USD per sqm. (Zawya)
Despite falling rents, returns on investment in the commercial real estate sector will remain roughly the same.
Yields will remain at 8-10% in Cairo and Giza and 6-7% in Alexandria. High interest rates will dampen private investment and weigh on the construction sector. The Central Bank of Egypt has raised rates by 1k bps since March 2022 in a bid to offset the impact of multiple currency devaluations triggered by the war in Ukraine. The spillover effects from the conflict have caused inflation to surge to near-record highs. (Zawya)
IMF trims Egypt’s economic growth forecast for FY2022/23 to 3.7%.
The International Monetary Fund (IMF) has cut its forecast for Egypt’s real gross domestic product (GDP) for the current fiscal year (FY) 2022/2023 to 3.7% from its previous projection of 4%. The country’s real GDP growth for the upcoming FY 2023/2024 is projected to reach 5%, down from a previous forecast of 5.3%. The IMF also expected Egypt’s inflation would hit 21.6% in 2023 before dropping to 18% next year. As per the global economic growth, the IMF expects it to hit 2.8% this year before rising to 3% in 2024. (World Economic Outlook (WEO) report)
Egypt’s Financial Regulatory Authority (FRA) will form a committee to supervise and regulate the country’s soon-to-be launched voluntary carbon market.
The new regulator's mandate will include establishing a rulebook outlining the requirements for issuing carbon credits, mapping out the greenhouse gas disclosure schemes companies would have to follow to verify their carbon output, and setting out the criteria for selecting verified carbon crediting bodies. The committee will be headed by FRA chief Mohamed Farid and include representatives from the country’s Environment Ministry, the Egyptian Stock Exchange (EGX), and the FRA. (Asharq Business)
Egypt inks 22 million EUR agreements to back industrial pollution control projects.
Egyptian Environmental Affairs Agency (EEAA) has signed three financing agreements worth a combined 22 million EUR with SEMADCO, Flex P Films, and Huhtamaki Egypt to support industrial and investment facilities related to the third phase of the pollution control program. (Arab Finance)
Egypt signs document on TFSC program with UNDP, AFD.
The Egyptian Environmental Affairs Agency (EEAA), the Ministry of Foreign Affairs, and the United Nations Development Program (UNDP) have signed the document of "Transforming Financial Systems for Climate in Egypt" (TFSC Egypt), with a grant worth 1.5 million EUR from the French Development Agency (AFD). (Hapi Journal)
Japan’s Sumitomo to build 100 million USD factory for EVs wiring harness production in Egypt.
Tokyo-based Sumitomo Corporation has received the golden License to build the largest factory worldwide for the production of electric vehicles’ (EVs) wiring harness in Egypt with around 100 million USD in investment. The factory will offer about 10,000 new jobs, and its production is set to be exported to global manufacturers of cars in Europe and the Middle East. (Hapi Journal)
Egyptian-Qatari JV wins 800 million EUR EPC contract in Libya.
The joint venture (JV) between Elsewedy Electric and the Qatari Urbacon Trading and Contracting (UCC) has been awarded a 800 million EUR engineering, procurement, and construction (EPC) contract for a 1,044-megawatt (MW) gas-fired power plant in Zliten, Libya. Awarded by the General Electricity Company of Libya (GECOL), the contract covers designing, supplying, installing, and constructing the project, including supplying six German natural gas-run SGT5-2000E turbines from Siemens Energy. (Arab Finance)
Heliopolis Housing to offer Granada city for investments.
Heliopolis Company for Housing and Development (HELI) is planning to offer Granada City for investment in the coming period to companies experienced in managing and operating commercial, entertainment, and service areas. This comes following the completion of the restoration and development of Granada city as part of the company’s plan to maximize the use of its heritage assets to boost its economic and financial return. (Arab Finance)