Egypt plans to issue international bonds worth 5 billion USD in 2022-2023
For our top talks today, Egypt plans to issue international bonds worth 5 billion USD in 2022-2023. Egypt issued 3 billion USD in bonds last September, taking advantage of lower borrowing costs before the US Federal Reserve began scaling back its economic stimulus program. Egypt expects the issuance of Islamic instruments, green bonds and samurai bonds before the end of next June. Today, Egyptian bonds joined the index JP Morgan Emerging market bonds, which will attract billions of dollars in liquidity in the coming months, given that Egypt’s return to the index gives investors more confidence.
- In addition, the Deputy Finance Minister, Ahmed Kojak stated that Egypt will receive 7 technical support missions from the International Monetary Fund in 2022. Noting that press reports indicated that Egypt is negotiating with the International Monetary Fund a new agreement worth 3 to 5 billion USD.
During the period from 2016 to 2020, Egypt borrowed $20 billion from the cash fund, through 3 different agreements. There are always official meetings going on with International Monetary Fund, whether in technical support or communication, and there are always consultations, and we are open, and all things are available. (Zilla Capital)
- Moreover, Egypt’s privatization program is set to resume in March, according to Egypt Finance Minister Mohamed Maait. “We can expect more state-owned companies to offer shares on the EGX in the coming weeks,” Maait said.
This comes a few days after Planning Minister Hala El Said announcement that the government plans to accelerate privatization by selling stakes in state-owned firms every month or two. The government’s privatization drive started to gain momentum late last year with the successful IPO of state fintech firm e-Finance and a secondary stake sale by Abu Qir Fertilizers. (Bloomberg Asharq)
- The Egyptian Minister of Planning and Economic Development raised her country's economic growth forecast for the current fiscal year to more than 6%, compared to previous expectations of 5.6%, according to the Minister Hala Al-Saeed.
Al-Saeed added, "We would like to assure everyone that the growth figures for the current quarter are better than expectations, and we will announce the figures in mid-February. For the whole year, the growth will be more than 6%." The minister did not go into more details. The Egyptian economy recorded a growth rate of 2% during the second quarter of 2020-2021, and about 1.35% in the first half of the same year, the year that witnessed the repercussions of the emerging “Corona” virus on various economies of the world. (Bloomberg Asharq)
- Egypt’s Ministry of International Cooperation announced launching an interactive map that showcases results of matching development finance with sustainable development goals, according to the ministry’s annual report for 2021.
According to the report, the map sheds light on the distribution of projects funded by multilateral and bilateral development partners nationwide in all development sectors. It added that the move came as part of directives of President Abdel Fattah El Sisi to harness financial resources to support the State's vision and facilitate the decision-making process in the future. (Arab Finance)
- On the other hand, The European Union (EU) is challenging Egypt’s import registration rules at the World Trade Organization (WTO), calling them “arbitrary” and in violation of WTO rules. According to the EU, exports to Egypt have fallen 40% since 2016, which it blames on the country’s compulsory import registration requirements.
The government in 2016 began requiring some foreign companies to register with Egyptian authorities before exporting goods to Egypt. Registration is currently required for 29 categories of goods, including agricultural and food products, cosmetics, toys, textiles, garments, household appliances, furniture, and ceramic tiles. Government officials said the move was designed to improve quality control of imported goods, while some observes had suggested at the time that it was intended to slow demand for foreign exchange. (Arab Finance)
- In a similar context, local Egyptian debt probably won’t be made “Euroclearable” until the second half of 2022 due to an unresolved “technical point” between the government and the Belgium-based clearinghouse, according to Egypt Finance Minister Mohamed Maait.
Having local debt cleared in Europe will make EGP bonds more accessible to foreign investors, who can currently only access the market through a small number of local banks. Making it easier for foreign funds to invest should translate into greater inflows into Egyptian debt. The Egyptian government has been working to meet Euroclear’s conditions since signing the initial agreement back in 2019. The ministry was originally expecting a final agreement in the fourth quarter of 2021, which was then pushed into early 2022 as talks dragged on. (CNBC Arabia)
- Moving to our EGX and companies talks, Taqa Arabia, a subsidiary of Qalaa Holdings (CCAP), is planning to list its shares on the Egyptian Exchange (EGX) in 2023, according to the company’s Managing Director Pakinam Kafafi. The company has postponed the offering of its shares on the EGX for two years due to the Covid-19 pandemic, Kafafi said.
EFG Hermes Holding (HRHO) and HSBC Bank have been chosen to act as the financial advisor on the offering, she remarked. Chairman of Qalaa Holdings Ahmed Heikal previously revealed that the company is planning to float 30% of Taqa Arabia’s shares on the EGX in April. It is worth noting that Qalaa Holdings holds a 55% stake in Taqa Arabia, according to Heikal. On the other hand, Kafafi noted that Taqa Arabia has allocated around EGP 1.5 billion for investments in 2022. These investments will be pumped into adding new gas or diesel stations and desalination plants, as well as the establishment of a warehouse at a cost of up to EGP 500 million within two years, she added. (Al Borsa Newspaper)
- Henkel Egypt announced the signing of a cooperation agreement with "Cartona" to be the first leading detergent company on the app to facilitate product reach through cashless transactions.
It is worth noting that wholesale and retail trade is one of the leading sectors of the Egyptian economy which has witnessed huge growth and developments in recent years as demand grew increasing the profitability of the sector. Moreover, Retail and wholesale trade account for 85% of the detergent sector in Egypt, which is positively reflected in Henkel's efforts in this field to improve performance and develop strategic plans to convert traditional transactions into digital ones. (Arab Finance)
- El Sewedy Electric for Trading and Distribution, a 99.8%-owned subsidiary by Elsewedy Electric (SWDY), has signed a new sub-contracting contract at a value of 615 million EGP. Under the contract, El Sewedy Electric for Trading and Distribution will handle the supply, installation, execution, and testing of networks and infrastructure works of Alexandria Port.
This comes as part of the implementation of the all-purpose station of quays No.55 to 62 that have been awarded to EDECS for the Egyptian company for all-purpose stations. The project is set for completion within a seven-month period. (Arab Finance)
- Al Ahly Pharos Securities Brokerage Research has set its fair value (FV) of Eastern Company (EAST) at EGP 17.6 per share and the fair value (FV) of Cairo for Investment and Real Estate Development (CIRA) at EGP 20.0 per share with both an “Overweight” recommendation, according to a report released on Monday.
The Egyptian tobacco producer reported a net profit of EGP 4.28 billion in FY 2020/2021. Noting that CIRA’s consolidated net profit declined by 18.1% at the end of November 2021 to 100.3 million EGP, compared to 118.5 million EGP in the same period of 2020. (EGX)
- Egypt Aluminum (Egyptalum) (EGAL) has turned to profitability during the first half (H1) of fiscal year (FY) 2021/2022 recording a net profit after tax of 814.156 million EGP in H1 FY 2021/2022, versus a net loss of 341.30 million EGP in H1 FY 2020/2021.
Meanwhile, the company generated a revenue of 6.69 billion EGP in the July-December period of 2021, up from 5.01 billion EGP in the same period of 2020. It is worth noting that Egypt Aluminum reported it achieved a net profit after tax of 304.718 million EGP for the first quarter (Q1) of fiscal year (FY) 2021/2022, against a net loss of 150.97 million EGP in Q1 FY 2020/2021. (Mubasher)
- Master Group Development is approaching completing its construction target in The City Project at the New Administrative Capital (NAC), estimated at 65% of the total project, and is planning to launch a new phase with different privileges to meet the needs of its clients.
The City Project spans over 54 feddans in the NAC’s R7 with total investments worth 4.5 billion EGP. Mostafa Lashin, vice chairman of Master Group, stated that the work in the project has been progressing swiftly during the past three months in order to reach record building rates, in accordance with the company’s plan to complete the entire project in record time. (Arab Finance)
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