Egypt witnesses aggressive growth in net foreign direct investments inflows during Q3 2021, increasing 47.3%

Newsletter

19 Aug 2021

For our hottest news of the day, Egypt witnesses aggressive growth in net foreign direct investments (FDI) inflows during Q3-2021, increasing 47.3% year on year to record 1.42 billion USD compared to 970 million USD in Q3-2020. Non-oil FDI inflow also increased by 21.72% year on year to 1.91 billion USD during Q1-2021. The growth in Egypt’s FDI is in line with the International Monetary Fund’s (IMF) expectations of annual growth in FDIs over the next four years.

Second, Germany signs an agreement with Egypt to provide a soft loan worth 151.1 million EUR to finance 15 development projects in Egypt covering technical education, vocational training, innovation in the private sector, immigration, labor market, management reform, urban development, and efficiency of energy and renewable energy.
The financing comes as part of the mutual economic ties between the two countries, with the aim of supporting Egypt’s reform plans in achieving the objectives of sustainable development.
Third, the number of electronic wallets (e-wallets) backed by mobile phone operators climbed by 16 percent year on year (YoY) in H1 2021 reaching 16.3 million.
The number of transactions carried via e-wallet saw aggressive growth surging 175% in the same time frame to 81 million transactions. The Central Bank of Egypt has been promoting the digital transformation of the economy in effort to increase financial inclusion among the population.
On another note, The Egyptian consortium of The Arab Contractors and El Sewedy Electric commence installations of the electricity generating units in The Julius Nyerere hydropower station in Tanzania.
The hydropower station is planned to begin the first phase of filling before the end of the current year and upon completion is expected to double the electricity generation capacity on the Tanzanian Grid.
Moving on to the investment coverage, Cairo for Investment and Real Estate Development (CIRA) and El Sewedy Capital establish a university in New Damietta city through their JV Cairo Egypt for Education (CEE) with investments over 2.5 billion EGP.
The JV has already finalized the acquisition of a 58 feddan land plot from the (NUCA). The university will include 16 faculties and potentially serving more than 25 thousand students both locally and regionally with the inauguration of the first phase expected in September 2023.
Equally important, EFG Hermes advises on the secondary bloc sale of four institution’s stakes in Fawry for Electronic Payments (Fawry) worth 80 million USD.
The transaction involved the sale of 73.9 million shares of Fawry, representing around 4.3% of Fawry’s total outstanding shares. EFG acted as the sole financial advisor and lead bookrunner for the selling the shareholders namely The American Egyptian Enterprise Fund, Link HoldCo B.V, Responsibility for Investment, and MENA LTV.
With regards to our company coverage, EFG Hermes’ revenues surge to 1.6 billion EGP in the second quarter of 2021 on the back of the strong performance of the investment banking and the NBFIs.
Revenues from the consumer finance arm and the factoring activities increased threefold while revenues from investment banking grew 69% in Q2 2021 supported by advisory fees as a result of the increase in the M&A deals.
Finally, for Covid’s Watch, The United Kingdom donates 299,700 doses of AstraZeneca vaccine to Egypt under the Covax program supported by0020UNICEF and the World Health Organization.
This is the first batch to be dispatched by the UK part of a total of 100 million doses to be distributed by the UK to countries worldwide within the next year. We had already received 1.76 million doses of the AstraZeneca vaccine last Friday through the Covax program.