Egypt's annual headline inflation rate rose to 10% in February 2022, compared to 4.9% in the same month of 2021 | Zilla Capital

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13 Mar 2022

Egypt’s annual headline inflation rate rose to 10% in February 2022, compared to 4.9% in the same month of 2021

For our top talks today, Egypt’s annual headline inflation rate rose to 10% in February 2022, compared to 4.9% in the same month of 2021. The accelerated inflation is attributed to the surge in prices of the vegetables segment by 19.6%, the meat and poultry segment by 6.1%, the fruits segment by 5.5%, and the grains and bread segment by 2.2%. Moreover, the prices of the mineral water, soda, and juices segment rose by 2.2% last February, while the prices of the dairy products and eggs segment increased by 2%. Furthermore, the monthly consumer price index (CPI) recorded 121.4 points in February, representing a 2% growth rate as compared to January. It is worth noting that the annual headline inflation rate grew to 8% in January, compared to 4.8% in the same month of 2021. (the Central Agency for Public Mobilization and Statistics (CAPMAS))

The Central Bank of Egypt (CBE) decided to extend the deadline for banks to comply with the new banking law regarding the minimum limit of capital as per Article 4 of Law No. 194 of 2020.
Accordingly, the deadline has been extended for a year until September 14th. It is worth noting that the new banking law requires local banks to increase their minimum paid-up capital to 5 billion EGP. Under the new law, foreign banks shall raise their capital to 150 million USD or its equivalent in any foreign currency. (CBE)
The value of letters of credit (LC) and collection documents offered by Suez Canal Bank (CANA) has reached around 14 billion EGP in 2021, according to the bank’s Chairman Hussein Refaie.
The CBE’s decision to abide banks to only accept letters of credit to ease the purchase process of imports and to not accept documentary collection from exporters. The decision will control imports and the quality of imported products. Moreover, the top official revealed that the bank’s securitization portfolio grew to 4.2 billion EGP at the end of February 2022. Suez Canal Bank is an Egypt-based company engaged in providing corporate, retail, and investment banking products and services. (Al Mal)
Saudi Egyptian Developers Company (Secon) is in talks with a number of banks, including Banque Misr and National Bank of Egypt (NBE), to obtain a loan worth 1.5 billion EGP.
The company will use the loan to partially finance its Bleu Vert in the New Administrative Capital. On the other hand, Secon has entered preliminary talks to borrow a sum of 1 billion EGP from some banks to finance the construction of the first phase of the administrative commercial project in New Cairo. Moreover, the company intends to launch a mega project in New Cairo, with targeted sales of 17 billion EGP, noting that this project will be built over four years with 12 billion EGP in investment. Secon is considering the issuance of securitized bonds this year. Furthermore, he said that the company’s management targets achieving sales of 11 billion EGP in 2022, to reach 15 billion EGP within three years. (Al Mal)
The Suez Canal Economic Zone (SCZONE), the Sovereign Fund of Egypt, Egyptian Electricity Transmission Co. (EETC), New and Renewable Energy Authority (NREA), and Norway’s Scatec have signed a memorandum of understanding (MoU).
The MoU has been signed regarding the green ammonia production from green hydrogen at the SCZONE. The project will be implemented at a cost of 5 billion USD over two phases. Production from this project is expected to commence in 2025. The MoU has been signed by Chairman of the SCZONE Yehia Zaki, CEO of the Sovereign Fund of Egypt Ayman Soliman, Chairperson of EETC Sabah Mashali, Chairman of NREA Mohamed El-Khayat, and CEO of Scatec Raymond Carlsen. (Arab Finance)
Egyptian exports recorded a growth rate of more than 15% during the first two months of 2022, according to the Minister of Trade and Industry minister Nevine Gamea.
The geopolitical tensions could affect the volume of Egyptian exports this year, noting that the impact could be positive. On the other hand, Egypt has not been impacted by the Russia-Ukraine war yet as it has enough strategic reserve of commodities, referring to the government’s ability in handling crises. Moreover, the trade exchange between Egypt and both Russian and Ukraine will be subject to current variables that could occur due to the status quo. It is worth noting that the Egyptian Food Export Council revealed that Egypt's total exports of food industries to Russia and Ukraine in 2021 are worth a combined 67 million USD. (CNBC Arabia)
Total Egyptian exports of food industries to Russia and Ukraine in 2021 are worth a combined 67 million USD.
Egypt’s food industries exports to the two countries made up 1.68% of the country’s total food exports worth 4.1 billion USD at the end of 2021. Egyptian exports of food industries to Russia recorded around 64 million USD in 2021, jumping by 61% from 40 million USD in 2020. Meanwhile, Egypt’s food industries exports to Ukraine rose by 3% year-on-year (YoY) to 3.3 million USD in 2021. In 2021, Russia was ranked 21st among top importers of Egypt’s food industries, while Ukraine came in the 81st spot of the list. The number of Egyptian exporters of food industries to Russia reached 152 last year, while the number of companies exporting to Ukraine amounted to 46. (Egyptian Food Export Council)
And for our EGX and companies talks, Fawry for Banking Technology and Electronic Payment (FWRY) has signed a cooperation protocol with Misr Insurance, a subsidiary of Misr Insurance Holding.
Under the agreement, premiums of different insurance policies will be collected through Fawry network which includes ATMs, electronic portfolios, and outlets, along with the service of FawryPay. Fawry will also provide branches of Misr Insurance with point-of-sale (POS) terminals. The protocol will help us reach clients across the country and collect premiums through Fawry’s diverse network, according to Misr Insurance’s Managing Director and CEO Omar Gouda. (Hapi Journal)
Careem, a subsidiary of Uber Technologies Inc., is seeking to raise up to 500 million USD from investors.
The Dubai-based company is in early-stage talks with regional sovereign wealth funds, including Saudi Arabia’s Public Investment Fund and Abu Dhabi’s ADQ, to secure the funds. Careem is looking to use the funds to expand into services beyond ride-hailing. Bank of America Corp. is acting as the advisor on the transaction. The final amount of investments is subject to change as more funds could join. It is worth noting that Uber acquired Careem two years ago for 3.1 billion USD. (Bloomberg)
Banque Misr has recently signed a cooperation agreement with Noon Payments to provide and upgrade e-collection services by using banking cards and e-wallets through QR Code.
The agreement comes within the framework of Banque Misr’s strategy to expand in the e-payment services sector, in order to offer customers unique services in line with the ongoing digital transformation process. It is worth noting that Banque Misr has been a pioneer in offering e-collection services through QR Code and supporting the digital transformation by providing customers with e-solutions. (Arab Finance)
Ezz Steel (ESRS) increased steel prices by EGP 1,500 per ton which is the second increase in a week.
Under the new pricing, a ton of steel will cost 17,000 EGP as of Thursday, March 10th. In a similar vein, Egypt’s metal exports surged 89% year-on-year (YoY) to 3.4 billion USD in 2021. Iron and steel exports jumped 145% to 1.78 billion USD in 2021, from 728 million USD in 2020. (Amwal Al Ghad)
And finally for our investments talks, Brmaja, a Saudi Arabian technology solutions provider, has boosted its investments in Egypt by 20% in 2022, according to the CEO Hatem Bakheet.
The company and its two subsidiaries, Brmaja IT and Brmaja Innovation, are planning to expand in the Egyptian market and pump further investments in the market over the coming period. Egypt is one of the fast-growing digital services markets, he noted. Brmaja Innovation for IT has presence in 16 countries across the world, providing its customers with high-quality IT consulting. (EGX)
Carrefour Egypt, a subsidiary of Majid Al Futtaim Retail, is planning to invest 250 million EGP in the Egyptian market, according to Carrefour Egypt head Philippe Peguilhan.
Through these investments, the company aims at opening 10 new stores, Peguihan said, noting that Carrefour currently has around 59 stores in Egypt, of which 14 are hypermarkets and 45 are supermarkets. In February, the company opened seven new stores, he pointed out, adding that a new store under the name of “Supeco” will be opened to provide services for customers and retailers. Moreover, he highlighted that the total investments by Majid Al Futtaim in Egypt now stand at around 2.3 billion EGP. (Amwal Al Ghad)