Egypt’s annual urban inflation went down to 6.2% in November
For our top talks today, Egypt’s annual urban inflation went down to 6.2% in November, compared to 6.3% in the same month in 2020, according to official data on Thursday. The consumer price index (CPI) stood at 118 points in November, maintaining its October level. The stability in Egypt’s inflation on a monthly basis is attributed to both the increase and decrease in prices. Grocery prices declined by 11% in November, while fruits as well as meat and poultry witnessed a plunge of 5.1% and 3.4%, respectively, in their prices. On the other hand, the prices of oils, grains and bread, and dairy products rose by 13.7%, 3.2%, and 1%, respectively. Annually, food and beverage prices in Egypt surged by 9.3% in November this year, compared to the same month in 2020. (Central Agency for Public Mobilization and Statistics (CAPMAS))
- That will lead us directly to the CBE’s final policy meeting of the year, which will take place on 16 December. Policymakers have held off lowering interest rates further this year
and it is expected that will continue to remain doing so next week in the face of Egypt’s current account deficit. The current account deficit widened by almost two thirds during FY 2020-2021 to 18.4 billion USD due to falling tourism revenues and rising imports. It is expecting it to narrow to 4.0% of GDP during the current FY from 4.8% in 2020-2021. (CBE)
- The Central Bank of Egypt (CBE) has signed a cooperation protocol with the Ministry of Finance, the Egyptian Banks Company (EBC), and Misr Technology Services Company (MTS)
in order to link the national single window for foreign trade facilitation “Nafeza” with the Egyptian network of banks, according to a statement by the bank. The step aims to facilitate exchanging data and documents necessary for import operations electronically. It also falls in line with the country’s direction to implement the Advanced Cargo Information system, which aims to improve Egypt’s global index in the field of cross-border trade, and reduce the cost of imports by reducing the release time and accurately identifying the parties to the transaction in accordance with the procedures. (CBE)
- In a similar context, Egypt’s Supply and Internal Trade Minister Ali Moselhi announced the start of the implementation of a major project to establish a logistical zone in the northern Dakahlia governorate.
The step follows President Abdel-Fattah El-Sisi’s directives to develop the trade system in Egypt. The new zone will be built over an area of 46 feddans, and will comprise commercial, administrative, and logistical activities in addition to recreational activities and a hotel, with a total volume of investments amounting to 2 billion EGP. (Arab Finance)
- Moreover, Georgy Borsenko, the Russian ambassador in Cairo, said that the El-Dabaa nuclear plant in Egypt is among the most modern and safest plants in the world, and will contribute to reducing carbon emissions.
He added, during the Egyptian-Russian Nuclear Energy Forum, that the forum is dedicated to implementing the sustainable development goals of the United Nations, noting that close cooperation between various countries is one of the important factors that ensure the achievement of these goals, and Russia and Egypt are a good example of such cooperation. (Al-Mal)
- Equally important, the Chemical and Fertilizers Export Council (CFEC) plans to raise Egypt's exports of chemical industries to 6.5 billion USD in 2023,
compared to 5.2 billion USD in 2020, the council's Chairperson, Khaled Abou El Makarem, announced. El-Makarem remarked that the council is setting a strategic plan to increase the country's exports of chemical industries, as part of the government's objective to raise exports of various commodities to 100 billion USD. The council's chairperson called for applying a subsidy scheme for the shipping industry, under which exporters obtain a 10% subsidy if the value-added ratio reaches about 80% and a 7% subsidy upon a 70%-60% value-added ratio. (Mubasher)
- And for our EGX & companies talks, last Wednesday, the Egyptian government sold 10% of the shares of a company Abu Qir Fertilizers and Chemical Industries about 2.25 billion EGP, and the secondary offering was implemented later in last Thursday’s trading session.
The company's share on the EGX jumped to 22.11 EGP, up 20% last Thursday, after it was down 2.1% last Wednesday, and the government's share in the company reached 41.3% after the deal was executed. A source familiar with the offering said that it was "covered about 3.2 times by investors. The market value of Abu Qir Fertilizers Company is about 23 billion EGP, and the company's paid-in capital is 1.892 billion EGP, distributed over 1.261 billion shares, with a nominal value of 1.5 EGP per shar (Al-Sharq Bloomberg)
- Furthermore, Al Ahly Capital Holding and the National Investment Bank (NIB) has sold 37.85 million shares and 42.39 million shares, respectively, in Abu Qir Fertilizers and Chemicals Industries Company (ABUK).
Al Ahly Capital cut its stake in the company to 4.185% from 7.185%. NIB cut its stake in the company to 21.52% from 24.88%. Additionally, the Industrial Development Authority (IDA) has sold 32.68 million shares in ABUK. IDA cut its stake in the company to 10.1% from 12.7%. Moreover, Chemical Industries Holding Company has sold 13.249 million shares in Abu Qir Fertilizers. Chemical Industries Holding cut its stake in the company to 5.5% from 6.5%. (EGX)
- Egypt-based Minly announced acquiring the UAE’s shout-out platform Oulo for an undisclosed amount. In June, Minly, the MENA region’s fastest growing media & entertainment start-up, closed a 3.6 million USD seed round co-led by 4DX Ventures, B&Y Venture Partners, and Global Ventures.
The acquisition of Oulo consolidates Minly’s position as the leading creator economy platform in the region and will accelerate Minly’s growth trajectory and customer reach. The merged business will operate under the Minly brand and roll out its combined experience offerings across the entire region. (Arab Finance)
- In addition, CI Capital Holding for Financial Investments (CICH) has entered a consortium with Banque Misr through their joint venture (JV) MCI Capital Healthcare Partners to acquire a stake in Cleopatra Hospitals Group (CHG) (CLHO.
MCI Capital Healthcare Partners is 60%-owned by CI Capital and 40%-owned by Banque Misr. The consortium aims at acquiring a minimum stake of 7.87%, representing 125.96 million shares, or a maximum stake of 12%, representing 192 million shares, in CHG.. (EGX)
- Likewise, Estshara, the Cairo based healthtech start-up, has signed a memorandum of understanding (MoU) with Integrated Diagnostics Holding (IDH), a leading consumer healthcare company in the Middle East and Africa, to provide virtual medical advices to patients.
Under the MoU, ALMOKHTABAR patients will have instant access to obtain recommendation and detailed medical support around the clock, seven days a week. (Arab Finance)
- Moving to our top story abroad, Australia is considering issuing a digital currency, along with regulating the cryptocurrency market, as it seeks to reform how state consumers and businesses pay for goods and services.
The government intends to hold consultations on a digital version of the cash, with global access. At the same time, Australia will consider the possibility of issuing a licensing framework that would allow cryptocurrency transfers to be made in a regulated environment. The state expects to have critical advice on both matters by the end of 2022. (Reuters)
- It is worth noting that the rapid growth of cryptocurrencies, which differ from digital currencies issued by central banks, poses a potential threat to monetary systems, and makes the conversation about dealing with cross-border fund transfers all the more urgent.
According to the Australian Taxation Office, more than 800,000 Australians have made transactions with digital assets since 2018. Australia is already part of the BIS experiment with digital central bank currencies, and aims to create a more efficient global payments platform. (Reuters)
- More about cryptocurrencies, money managers have confirmed that cryptocurrencies are among the asset classes that will see big sell-offs in the coming year. This comes after 2021 was in many ways the year that institutions embraced cryptocurrency.
In a survey for Natixis Investment Managers, nearly three-quarters of organizations surveyed said digital assets are a "top candidate" for a "big correction" in 2022, noting that they are not an appropriate investment for most retail investors. Many said that digital assets like Bitcoin can serve as good inflation hedges in an environment full of monetary stimulus. Despite their high volatility, it is not surprising that these various currencies have achieved huge gains, as the Bloomberg Galaxy Index of the largest cryptocurrencies has risen by nearly 200% since the beginning of this year. (Bloomberg)
- And finally, saving the bad news for the last, it is expected that the largest Chinese port in the world will be closed for the second time this year due to the presence of corona cases in the area in which it is located.
This for sure will increase the supply chain difficulties of global shipping, especially since most of the imports received by the Egyptian market come from this port, in addition to many regions in the world. The partial closure of the world's third-busiest container port has exacerbated ship congestion at other major Chinese ports, such as Shanghai, Xiamen and Hong Kong, as ships diverted away from the port of Ningbo amid uncertainty over how long anti-virus measures would take in City. (Reuters)
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