It is interest rate week. Zilla Capital expects that Egypt will keep interest rates unchanged in the Thursday meeting

Newsletter

30 Oct 2023

It is interest rate week. Zilla Capital expects that Egypt will keep interest rates unchanged in the Thursday meeting. The Central Bank of Egypt, in its seventh meeting for the year 2023 next Thursday, will keep interest rates unchanged, despite continued inflation rates. It is predicted that the CBE is holding back this step until it is ready to liberalize the exchange rate of the Egyptian pound against the dollar. The Central Bank of Egypt raised interest rates by about 100 basis points to 19.25% in August, bringing the total increase in interest rates to 1100 basis points since March 2022 when the bank adjusted the Egyptian pound’s rate. (Asharq Business).

The Central Bank of Egypt (CBE) has eased its restrictions on credit card use abroad that triggered a flight to the greenback and caused the EGP to weaken significantly in the parallel market.
The Central Bank of Egypt (CBE) has emphasized its commitment to simplifying the use of credit cards for citizens when covering their expenses while traveling overseas. As part of this effort, the CBE has decided that customers can access their predefined credit limits without the need for additional documentation. To do so, they simply need to contact their card-issuing bank's customer service or visit a branch. (Daily News)
When first announced, the restrictions sent the EGP plunging against the greenback in the parallel market as people rushed to acquire FX.
The USD weakened against the EGP on Thursday following the announcement, according to traders, who said that the currency was changing hands to 43-44 / USD compared to 48 on Wednesday. The credit card restrictions came a few days after most banks began blocking the use of EGP debit cards abroad as the central bank moved to stem outflows of FX. (Bloomberg)
The private-sector minimum wage will rise by 17% starting January 2024
after the National Council for Wages (NCW) decided to raise the threshold for the third time in less than a year to support workers amid soaring inflation. In a statemen t on Friday, the Planning Ministry said that private-sector firms will have to pay their employees a gross wage of at least EGP 3.5k a month from January, up from EGP 3k currently. Inflation reached an all-time high in September as the impact of the foreign-currency shortage and a series of devaluations continued to stoke price pressures. (Hapi Journal)
Travco has seen cancellations for reservations through the end of the year hit the 50% mark
as holidaymakers look to other corners of the world on concerns above Israel’s war on Gaza. Cancellations could spill over to next year, as bookings for the new year have slowed down significantly since the outbreak of hostilities. The war in Israel remains, where Israel warning residents to flee to the south as IDF troops “expand” operations on the ground in Gaza for a second day. Israeli PM Benjamin Netanyahu may not be calling it a full-on ground invasion just yet, but it’s certainly starting to feel like one. (Asharq Business)
Italian energy giant Eni expects to resume LNG exports from Egypt when seasonal demand eases even as Israel’s war in Gaza curbs our imports of Israeli gas.
Egypt has barely exported any LNG since the start of the summer due to declining local production and rising domestic demand. These two factors together have put pressure on local supply and triggered months of daily blackouts across much of the country. Shipping data show that Egypt has exported just two cargoes this month. (Bloomberg)
It’s worth noting that the value of the country’s LNG exports fell almost 60% y-o-y to 2.3 billion USD during the first seven months of the year.
Shipments of Egyptian gas to Europe have fallen to 2% of the continent’s total imports so far this year, down from 4% in 2022. Gaza war throws another wrench into the works: Egypt has seen its imports of Israeli gas curbed by 20% after Chevron suspended production at its Tamar field. (Bloomberg)
The EU may include the plan to link the power grids of Greece and Egypt on a list of “projects of mutual interest”, which would help the project secure licensing and funding.
Local renewable energy developer Infinity Power signed an agreement with Greece’s Copelouzos Group in May to conduct a feasibility study into the proposed 950-km, 3-GW link. GREGY is among five proposed projects to link Egypt’s power grids to Europe, which if implemented, would see Egypt exporting its surplus to Italy, Cyprus, and Greece.` (Bloomberg)
SCZONE signs contracts worth 3.57 billion USD for 60 projects in Egypt.
The SCZONE's Chairman, Waleed Gamal El-Din, disclosed that out of these, 53 projects, totaling 2.23 billion USD in investments, were located in industrial zones, while the remaining seven, with an investment value of 1.34 billion USD, were situated in ports. Gamal El-Din further mentioned that the authority also granted preliminary approval for an additional 55 industrial projects with a cumulative investment of 1.7 billion USD and officially registered 68 new companies within the region. Furthermore, 50 companies received construction permits, and 11 framework agreements were executed to produce various types of eco-friendly fuels annually. (Daily News)
Four new companies have been granted golden licenses to invest around 487 million USD.
The first license was obtained by "Samsung Electronics Egypt" to establish and operate a mobile phone factory in Beni Suef Governorate with an investment cost of 55 million USD. The second license was granted to the Egyptian Natural Gas Company "GASCO" to increase the capacity of its gas complex in the Western Desert by adding a fourth production line with a capacity of 600 million cubic feet per day, with an investment cost of 380 million USD. The third license will be used by "Egypt SAT2" to establish an electric car and bus factory in the Tenth of Ramadan City, with an investment cost of 9.7 million USD at the official exchange rate. The fourth license will be utilized by "El Fayoum Warehouses and Depots" to implement investments worth 42.07 million USD to establish strategic warehouses with a storage capacity of 75,000 pallets. (Economy Plus)
Egypt and Turkey discuss cooperation in the healthcare sector.
The Head of the Egypt Healthcare Authority, Ahmed ElSobky, held a meeting at the authority's headquarters in Cairo with the Turkish Ambassador to Egypt, Salih Mutlu. The primary objective of the meeting was to investigate opportunities for sharing expertise and strengthening collaboration between the two nations across multiple healthcare domains, including advanced services, digital innovations, and medical tourism. (Daily News)
Turkey is participating with 170 businessmen in the second international forum and exhibition for manufacturing in Egypt.
Engineer Ahmed Samir, the Minister of Trade and Industry, and Dr. Omar Bulat, the Turkish Minister of Trade, visited several pavilions at the second International Forum and Exhibition for Manufacturing organized by the Egyptian Industries Federation. During the visit, the ministers discussed various products exhibited at the event. The tour was also attended by Engineer Mohamed El Swedy, the President of the Egyptian Industries Federation, and various company representatives. (Arab Finance)