The Central Bank of Egypt’s Monetary Policy Committee is expected to increase interest rates by around 100 to 150 basis points in its next meeting, Thursday 19th of May 2022
For our top talks today, first, the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) is expected to increase interest rates by around 100 to 150 basis points in its next meeting, Thursday 19th of May 2022. The Egyptian pound is likely to be subject to downside risks as the currency rate is “flow-driven”, noting that higher outflows from further industrial imports after being exempted from the letters of credit (LCs) requirements. It is worth noting that Egyptian President Abdel Fattah El-Sisi recently directed the government to exempt production supplies and raw materials from the previously applied procedures on the importation process. Moreover, she highlighted that the net foreign liability (NFL) position of the Egyptian banking sector, including the CBE, increased to 12.1 billion USD in March from 3.39 billion USD in February. Excluding the CBE, the NFL of Egyptian banks stood at 7.04 billion USD in March, down from 11.4 billion USD the month before. It is worth noting that Egypt’s annual headline inflation rate rose to 14.9% in April 2022, compared to 4.4% in the same month of 2021. The international reserve at the CBE rose by around 41 million USD month-on-month (MoM) at the end of April. (Zilla Capital)
- Second, the Egyptian Ministry of International Cooperation announced the launch of the Ezdehar Mid-Cap Fund, with 170 million USD in capital.
The fund aims to reinforce investments in medium-sized enterprises as well as to strengthen their operation support, Minister of International Cooperation Rania Al-Mashat said. El-Mashat stressed the importance of cooperation between bilateral and multilateral development partners and the Egyptian private sector in boosting private investment to support Egypt’s development vision. For his part, Founder and Managing Director of Ezdehar Emad Barsoum said that the fund would provide the necessary financing and administrative support to small- and medium-sized enterprises (SMEs), in order to scale up their businesses and bolster their productivity and contribution to the national economy. (Arab Finance)
- Moreover, the automation and development process of the directorates of finance in Egypt will be 90% completed before the end of June.
This step will support the governance of the finance system in Egypt and boost the efficiency of the financial performance of the administrative entities in line with Egypt Vision 2030, Maait added. A number of directorates of finance are set to be opened in the governorates of Asyut, El-Beheira, the Red Sea, Marsa Matrouh, and El-Wadi El-Gedid, which will help achieve financial control and preserve the rights of the state, citizens, and employees, he noted. The minister stressed that the government is keen on rationalization of public spending to direct financial allocations to the most urgent needs amid global challenges that impacted all economies worldwide, particularly emerging markets. (Arab Finance)
- The Egyptian government is set to sign a supply, execution, and maintenance contract with German manufacturer Siemens for the second and third lines of the high-speed electric railway project before the end of May.
The eco-friendly train will be a great leap in Egypt’s sustainable greenway transportation. new railway will comprise three main lines stretched over 2,000 kilometers including 60 stations, he noted, adding that the second line extends over 1,100 kilometers, across Fayoum, Aswan, and Abu Simbel, covering 35 stations. Moreover, the minister highlighted that the ministry is studying the establishment of a logistics zone and a dry port in Toshka for receiving the area's freight train. The ministry also considers building logistics zones in Qustul, Arqeen, and Wadi Karkar to support trade movement. (Arab Finance)
- Egypt is weighing importing wheat from Pakistan and Mexico after India banned wheat exports due to a heatwave that impacted its wheat output.
The North African country is negotiating with Indian officials over an exemption from the ban on wheat exports, El-Attar revealed. The Egyptian government seeks to diversify wheat exports amid the Russian-Ukrainian war as it holds talks with France, Argentina, and the US. In the same vein, Egypt is set to receive the first wheat shipment from India soon. The shipment, which amounts to around 55,000 tons, complies with the international phytosanitary standards and all the Egyptian agricultural quarantine requirements. (Reuters & Ahram Online)
- Egypt is set to issue a national climate target to reduce greenhouse gas emissions within the coming weeks, according to the Minister of Foreign Affairs Sameh Shoukry.
Chairing the 2022 United Nations Climate Change Conference (COP27), Shoukry invited all countries to introduce their climate pledges, known as Nationally Determined Contributions (NDCs). The minister announced that Egypt’s NDCs would be declared in weeks, expressing his hopes for the world to pay attention to the ambition and commitment of Egypt to its climate goals. The COP27 will be held in Egypt’s Sharm El-Sheikh this year. (Reuters)
- Moving to our EGX and Companies talks, EFG Hermes Holding (HRHO) is set to be added to the MSCI Global Standard Index after its deletion from the MSCI Global Small Cap Indexes.
Moreover, Fawry for Banking Technology and Electronic Payment (FWRY) will be moved from the standard index to the MSCI Global Small Cap Index. Meanwhile, Egypt’s first fintech platform e-finance for Digital and Financial Investments (EFIH) will make its debut in the small-cap index. On the other hand, real estate development companies Heliopolis Housing and Development (HHD) (HELI) and Palm Hills Development Company (PHDC) will be removed from the MSCI Global Small Cap Index. The aforementioned changes will be effective as of May 31st. (Arab Finance)
- e& has acquired a 9.8% stake in the issued share capital of Vodafone Group in exchange for 4.4 billion
The UAE-based company has purchased around 2.76 billion shares in Vodafone to benefit from the expertise of the international company in connectivity and digital services. This transaction will help e& to increase its exposure to international markets and enter possible commercial partnerships in the areas of research and development, technological applications, and procurement. (Mubasher)
- SCZONE, Suez Canal Economic Zone, The Sovereign Fund of Egypt (TSFE), the Egyptian electricity transmission company, the new and renewable energy authority, and the consortium of Total and Enara Capital signed a memorandum of understanding (MoU) to produce green ammonia in Sokhna.
The MoU plans to set up a project for green ammonia production from clean energy in SCZONE and aims for the Sokhna area to become a leading regional center in the green hydrogen industries, coinciding with the global transformation to clean energy uses. SCZone has signed six MoUs for investments worth 10 billion USD for green hydrogen and green ammonia projects with international companies and alliances such as Scatec, Maersk, Masdar and Hassan Allam Utilities among others. (WAYA)
- Misr Fertilizers Production Company (MOPCO) (MFPC) posted a year-on-year (YoY) surge of 604.25% in standalone net profit after tax for the first quarter (Q1) of 2022.
The company recorded a standalone net profit after tax of 2.03 billion EGP in Q1 2022, compared to a profit of 289.28 million EGP in the corresponding three-month period last year. Moreover, Mopco generated standalone net sales of 1.605 million EGP in Q1 2022, rising from 637.56 million EGP in Q1 2021. MOPCO is an Egypt-based company that is engaged in the production, marketing, wholesaling, and distributing of fertilizers and petrochemical products. The company's various products include ammonia, urea, and nitrogen. (EGX)
- Raya Contact Center (RACC) has recorded a 305.8% year-on-year (YoY) surge in consolidated net profit attributable to the parent company for the first quarter (Q1) of 2022.
The company’s consolidated net profit attributable to the parent company has reached 7.11 million EGP in Q1 2022, growing from 1.75 million EGP in Q1 2021. The company also generated consolidated revenues of 252.17 million EGP in the January-March period of 2022, compared to revenues of 182.86 million EGP in the same quarter of 2021. At the level of standalone financial statement, Raya has turned to profitability in Q1 2022, with a net profit after tax of 1.95 million EGP, versus a loss of 6.19 million EGP in Q1 2021.
- Credit Agricole Egypt (CIEB) has posted a 30.49% year-on-year (YoY) growth in standalone net income after tax for the first quarter (Q1) of 2022.
The bank recorded a standalone net income after tax of 486.38 million EGP in Q1 2022, compared to 372.73 million EGP in the year-ago period. Meanwhile, interest income rose by 8.55% YoY in Q1 2022 to 1.35 billion EGP from 1.24 billion EGP. (EGX)
- And finally, Abu Dhabi Islamic Bank Egypt (ADIB) reported a 33.7% year-on-year (YoY) increase in consolidated net profit after tax for the first quarter (Q1) of 2022.
The bank recorded a consolidated net profit after tax of 444.297 million EGP in Q1 2022, compared to a profit of 332.224 million EGP in the same quarter of 2021. Meanwhile, the bank’s standalone net profit after tax amounted to 423.905 million EGP in the three-month period ended March 31st, up by 33.1% YoY from 318.369 million EGP. (EGX)
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