DOW JONES AND CASE LAUNCH BLUE CHIP INDEX Source: Hedgeweek, April 20, 2006.
Dow Jones Indexes has teamed up with the Cairo & Alexandria Stock Exchanges (CASE)(link here)to launch the Dow Jones CASE Egypt Titans 20 Index.
This blue-chip index measures the performance of the Egyptian stock market by following the transparent and objective methodology of the Dow Jones Global Titans 50 Index and includes 20 leading Egyptian stocks ranked by free-float market capitalization, sales/revenue and net income.
The Dow Jones CASE Egypt Titans 20 Index is designed to serve as an underlying for investment products such as mutual funds, exchange-traded funds and other financial products that enable investors to participate in the performance of the Egyptian stock market.
"The cooperation with CASE - the biggest stock exchanges in North Africa - sets the standard for investible indexes in this region and provides reliable underlying tools for financial products for these expanding regional investment communities," says Lars Hamich, managing director of STOXX Ltd, the joint venture that is responsible for Dow Jones Indexes' business development in Europe and Asia. "We are optimistic that this index will raise the profile of this thriving financial market and will help to attract more international investors."
The methodology of the Dow Jones CASE Egypt Titans 20 Index is consistent with the transparent and rules-based Dow Jones global index family. The top five companies in the index by free-float market capitalization are: Orascom Telecom Holding, Orascom Construction Industries, EFG Hermes Holding, Egyptian Kuwaiti Holding and Commercial International Bank.
The Dow Jones CASE Egypt Titans 20 Index is reviewed annually in June. Float figures, provided by CASE, are updated bi-annually in June and December, while the weightings are reviewed quarterly. The index has a 94.05% annualized total return performance from December 31, 2001 until March 31, 2006. The base value is set at 100 and historical data is available back to December 31, 2001. The Dow Jones CASE Egypt Titans 20 Index is calculated in Egyptian Pounds as well as Euro and US Dollars.
WORLD ECONOMIC FORUM SHOWING SOLIDARITY WITH EGYPT Source: MENA Reports, April 25, 2006.
Following the terrorist bombings Monday night the World Economic Forum has issued the following statement concerning its planned meeting in Egypt next month: The Executive Chairman of the World Economic Forum, Klaus Schwab has written to President Mubarak to express his deep sympathy with the Egyptian Government and people.
“The immediate temptation would have been to cancel our Forum in Egypt next month, but for the sake of a more peaceful future for humankind we have to show our solidarity by holding this meeting. We must demonstrate to the world that political and economic leaders take on their responsibility to work for a more harmonious and prosperous development of the Middle East - despite all the challenges and difficulties,” he said.
The World Economic Forum has organized meetings in the Middle East for many years last year the Forum was in Jordan. This year, in cooperation with the Egyptian government, 1,000 participants from the highest levels of business, government and civil society will come together in Sharm-El-Sheikh to take decisions to help shape the regional agenda.
ARAB FUND OFFERS EGYPT TWO LOANS Source: MENAFN & www.Arabonline.com, April 28, 2006.
The Arab Fund for Economic and Social Development (AFESD) signed two loan agreements with Egypt whereby the latter gets USD 216 million to upgrade a power plant and an airport.
The first loan (for USD 116 million) will be used to spruce up the Hurghada city international airport to receive increasing flocks of tourists to it.
The second loan (for USD 100 million) will finance a key regional power plant.
Signing the loan agreements for Egypt was its minister of International Cooperation Fayza Abul-Naga and for AFESD its Kuwaiti chairman Abdullatif al-Hamad.
In statements to reporters, the Egyptian minister noted that the interest on the loans will be 3 percent, payable over a period of 21 years. There will be a grace period of 5 years for the first loan and 6 years for the second, said the minister.
She indicated that the loans were part and parcel of the cooperation between Egypt and AFESD that has in recent years materialized in the financing of many Egyptian infrastructure projects.
US SENATOR: EGYPT PLAY KEY ROLE IN MIDDLE EAST Source: Global News Wire, April 20, 2006
President Hosni Mubarak received Monday April 17th US Senator Richard Shelby, Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, and his accompanying delegation.
The meeting was attended by Foreign Minister Ahmed Abul- Gheit and Minister of Information Anas El-Fiqqi, along with Senator Paul Sartre of Maryland, Representative Robert Cramer of Alabama and US Ambassador in Cairo Francis Ricciardone.
The US delegation arrived on Sunday April 16th on a two-day visit to Egypt for talks with officials on Egyptian-US cooperation in eliminating money laundering and encouraging foreign investments in Egypt.
For further information on Egypt-U.S. Relations (click here).
NEW CAPITAL MARKET AUTHORITY (CMA) RULES Source: Zawya, April 17, 2006
The Capital Market Authority (CMA)(link here)approved the CASE new membership rules.
Which includes raising the minimum required capital for brokerage companies operating in the market to LE 5 million, with a six months grace period given to existing companies to make the necessary adjustments. It also approved the Internet trading system.
For Amcham’s Proceedings of the Conference on the “Reform of the Egyptian Financial Sector” (click here).
MIDCOM TO ESTABLISH NEW CEMENT FACTORY IN ASWAN Source: Mist News, Al Alam El Youm April 16, 2006.
Midcom for Real Estate Development Company plans to establish a new cement factory in Aswan, with an estimated investment cost of LE 400 million and an annual production capacity of 900 thousand tons, where almost 70% of its total production will be directed for exportation to Sudan.
The plant is expected to be completed in 14 months and will start operation in 2008.
KUWAIT MAZAYA HOLDING COMPANY SETS UP REAL ESTATE COMPANY IN EGYPT AND JORDAN Source: Asia Africa Intelligence Wire, April 20, 2006.
Chairman of the Board of the Mazaya Holding Company, Rashid Yacob a-Nafisi, said in early March 2006 that Mazaya will set up a subsidiary company for real estate in Kuwait in cooperation with a local company, with equity of $100 million.
The new company will focus on investments in real estate in the Gulf States, especially in Dubai, UAE. Mazaya is acting to set up a subsidiary real estate company in Jordan in cooperation with the international Global Investments Company, with equity of KD 16 million, and one in Egypt on the Red Sea and northern Sinai Peninsula.
EGYPT REGULATOR SEES EGP5.2B BID FOR PHONE LICENSE Source: Dow Jones Newswires, Apr 19, 2006.
Egypt expects a minimum of 5.2 billion Egyptian pounds ($1=EGP5.89) to be offered in a tender for its third mobile license, a business newspaper reported Wednesday, quoting the Executive President of the Regulator.
Al Alam Al Youm daily newspaper reported that Amr Badawy, Executive President of the National Organization For Telecommunications Regulation, said he expected at least 10 offers to be presented after many of the companies which announced their intention to bid formed partnerships with each other.
The successful bidder will be announced in July, he said.
The deadline for receiving offers for the bid is May 4. Offers from international companies which have local partners and firms willing to trade a portion of the shares on the Cairo and Alexandria Stock Exchange after two years of operation will be favored, according to the terms.
Badawy said priority would be given to companies pledging to start operating the mobile network in the quickest possible time and he added that some companies had promised to operate within six months of being granted the license.
Potential bidders include Turkey’s Turkcell (TKC); Kuwait’s MTC, Emirates Telecommunications Corp. or Etisalat, (ETISALAT.AD), of the United Arab Emirates, Egypt’s Raya Holding (RAYA.CI) in an alliance with South African firm MTN Group Ltd (MTN.JO), and Telecom Egypt (ETEL.CI).
Egypt currently has two mobile operators - Vodafone Egypt Telecommunications (VODE.CI) and Egyptian Company for Mobile Services, or MobiNil (EMOB.CI).
Vodafone Group PLC (VOD) owns 50% of Vodafone Egypt while MobiNil’s shareholders include Egypt’s Orascom Telecom Holding (ORTE.CI) and Orange, which is a unit of France Telecom (FTE).
EGYPTIAN COMPANY BUYS AMERICAN INTERNET COMPANY Source: Asia Africa Intelligence Wire, April 23, 2006
A-Sharq Al-Awsat newspaper reported on the purchase deals of the American ForeTech Internet Services Supply Company by the Egyptian Internet Company, The Way Out.
The paper quoted President of the Egyptian company, Tamir Sayd Ahmad who announced this deal in early March 2006 and said that the deal was worth EP 25 million ($4.5 million). The purpose of this purchase deal is to enlarge the extent of European operations of the Egyptian company.
LE2 BILLION AGREEMENT TO ESTABLISH A MANUFACTURING ZONE FOR TEXTILES AND CLOTHING IN EGYPT Source: Zawya, April 29. 2006
The Industrial Development Association in Egypt and a leading Turkish company in the textile industry will sign a EGP2 billion agreement to establish a manufacturing zone for textiles and clothing on Egypt’s Mediterranean coast, the Cairo-based al Ahram daily reported Wednesday.
The newspaper did not provide an exact location for the zone or the name of the Turkish company but stated that the project would provide around 500 jobs and all production would be exported to international markets.
The Egyptian minister of trade and industry was scheduled to meet Wednesday with several Turkish companies in order to discuss ways to attract Turkish companies to invest in this new zone. He noted that many textile companies are already establishing factories in a new industrial zone in Borg al-Arab city, near Alexandria.
“Bilateral trade in 2005 stood at US$949 million where Egypt exported US$264 million of goods and imported US$685 million.
Turkish investments in Egypt’s textile, agriculture, services, pharmaceuticals and tourism sectors reached EGP109 million whereas Egyptian investments in Turkey’s services sector amounted to US$5 million,” said the head of the Egyptian Commercial Representation at the ministry of trade and industry.
Egyptian exports to Turkey include rice, cotton, petroleum products while important imports are cars and car spare parts, dried vegetables, and steel products. Egypt and Turkey last year signed a Free Trade Agreement that went into effect in January. According to economic analysts, bilateral trade is expected to double in the coming years once the impact of the agreement starts to materialize.
For AmCham’s Textile & Clothing Industry Study (click here).
NEW MEGA PETROCHEMICALS PROJECT Source: Asharq al-Awsat, April 18th 2006
Construction is scheduled to start in 2008 and the plant would begin operations in 2011. Egypt intends to finance 70% of its largest petrochemical and refining project from banks and financial institutions.
The remaining 30% of the $9.5 billion venture would be financed through subscription in the project’s capital under a private placement. The project is expected to pump about $5 billion in the Egyptian economy over a four-year period. According to a study by International Monetary Fund (IMF), this would contribute to a continuous annual growth of Egyptian GDP by 0.5% to 1%.
This plant would also help improve the Egyptian balance of trade by $1.4 billion and the average investment rate will increase annually by 8.5% during the construction period, he explained. The plant has a proposed annual production capacity of one million tons of refined materials and 4.2 million tons of petrochemicals. It would also generate electric power of 146 megawatts. The production capacity will represent three times the output of Egypt’s Midor refinery and half of overall Egyptian production of refined oil.
EGYPT, ALGERIA IN JOINT VENTURE TO PROSPECT FOR OIL & GAS Source: BBC Monitoring International, April 24, 2006
Minister of Petroleum Samih Fahmi said Monday [24 April] Egypt and Algeria will establish a joint venture to prospect for oil and natural gas in the two countries.
During a meeting with his Algerian counterpart Chekib Khalil on the sidelines of Doha World Energy Forum, Fahmi said contracts for two oil agreements were signed Monday with profits and revenues equally divided.
The two countries have strong inclination to bolster cooperation in oil prospection domain, he said.
Meantime, the Arab natural gas pipeline member states held a parallel meeting on the sidelines of the forum to probe means to beef up cooperation among them.
EGYPT JOINS GAS EXPORTING COUNTRIES CLUB Source: IPR Strategic Business Information, April 17, 2006
President Mubarak Saturday 15/4/2006 opened Edco complex for liquefying and exporting natural gas, one of the biggest projects in the history of oil industry in Egypt.
The project heralds Egypt’s entry into the six-member gas exporting countries club. The complex is located on an area of 390 feddans along the Mediterranean coast and its planning allows expansions for building four other liquefying gas plants.
Minister of Petroleum Eng. Sameh Fahmy said investment costs of the project amount to 4.6 billion dollars adding that through Egypt’s expertise record figures were achieved in terms of timing, implementation programs, and investment costs in comparison with similar factories all over the world.
Fahmi said the project is the first integrated complex of the various stages of gas production. He said the project is equipped with the most up-to-date technology in the industry of liquefied gas. He said the production of fields in this area accounts for 40% of Egyptian gas and 60% of the liquefied gas in Egypt.
EGYPT PLAN TO BUILD ARAB DISNEYLAND Source: InfoProd, April 20, 2006
Al-Khaleej Newspaper reported on the decision of a group of local and foreign investors to build a theme park in Egypt on the order of Disneyland at an investment of $5 billion.
The paper quoted Saudi investor Hashim al-Mahdhar who said in early March 2006 that the area of the theme park will be 84 square kilometer and it will include twenty hotels and resorts. It is to be called Arab Disneyland and will supply jobs for half a million young workers.
EGYPT: IFES BEGINS ELECTORAL REFORM PROJECT IN EGYPT Source: IFES, April 26, 2006 - Washington
IFES (link here) is beginning a $1.3 million project that will examine how election administration in Egypt can become more credible and effective.
The project aims to expand public discussion on electoral reform and inform voters about their rights and responsibilities. The year-long project also will seek to connect and expose voters to high-level policy discussions already taking place about electoral reforms.
IFES will work with Egyptian academics, think tanks, government officials and community organizations to find areas of reform in the electoral process. The IFES team will include international comparative experts with experience managing similar electoral transitions in countries as diverse as Mexico, Eastern Europe and India.
“The administrative breakdown of the election process is so severe that there now is a growing consensus among those in government and the opposition that there needs to be some level of reform,” he said. Egyptian voters would benefit from the establishment of a transparent, independent electoral commission, an updated voter registry and a voter education campaign.
IFES began working in Egypt last year with a project that brought together 10 Egyptian nongovernmental organizations into a coalition that promotes voter education. IFES also worked with the Al Ahram Center for Political and Strategic Studies to organize and present three seminars on electoral reform issues.
NEW PROJECTS WORTH US$ 320 MILLION Source: Global News Wire, April 17, 2006
Minister of State for Environment Affairs Eng. Maged George said Saturday that work has begun in three environment-friendly projects worth US$ 320 million. He expected the projects would provide 1000 job opportunities. The largest project of the three is a plant for the production of magnesium alloys, to be established south of Sokhna seaport at a cost of US$ 300 million. The plant will produce 46 thousand tons in the first stage and will provide 900 job opportunities.
KBR CHOSEN TO DESIGN, BUILD AND OPERATE AMMONIA PLANT IN EGYPT Source: www.halliburton.com & Business Wire, April 21, 2006.
KBR (link here), the engineering, construction and services subsidiary of Halliburton (NYSE:HAL), announced today that it has been selected to build and operate Egypt Basic Industries Corporation’s (EBIC) new ammonia plant using the company’s proprietary ammonia technology, KAAP™ (KBR Advanced Ammonia Process).
KBR will provide engineering, procurement and construction (EPC) and operation and maintenance (O&M) services to the 2,000 metric ton per day (mtpd) export-focused Greenfield ammonia plant, to be located in Ain Sokhna, Egypt.
KBR’s proprietary KAAP technology comprises a catalyst of ruthenium on a stable graphite carbon support, with an activity up to 20 times higher than traditional iron-magnetite catalyst. As a result, synthesis loop pressure is lowered to about 90 bar, which equates to significant savings in capital cost and maintenance for the customer. Although KAAP is currently used at several 1,850 mtpd ammonia plants in the Caribbean, the 2,000 mtpd EBIC project represents the largest commercial application of this technology since its introduction to the market in 1992, and the first in Egypt.
“KBR has been on the leading edge of ammonia plant technology for more than 60 years,” said Lou Pucher, senior vice president, KBR Energy and Chemicals. “The company has licensed more than 200 ammonia plants since 1943, and our exclusive Advanced Ammonia Process technology positions the plant owner as a low-cost producer in the highly competitive ammonia business.”
EPC work began in the first quarter of 2006, with completion of the facility due in the second half of 2008. Natural gas for the project will be purchased from the Egyptian General Petroleum Company (EGPC) and used as a feedstock to produce ammonia using the KAAP technology. The ammonia will, in turn, be purchased by Transammonia and exported by ship from the adjacent Sokhna Port facility. KBR will operate and maintain the plant for EBIC for up to 15 years.
KBR co-developed the project and will be one of the shareholders in EBIC along with Orascom Construction Industries, PSK Holdings, Egypt’s General Petroleum Corporation, Sokhna Port and several private investors. The Export-Import Bank of the United States has provided its guarantees for two-thirds of the project financing, which is provided by five international banks.
NEW ENTERPRISE IN EGYPT PRODUCED OVER 400 LADA VEHICLES Source: RIA OREANDA, April 19, 2006.
The new assembly enterprise of the company "LADA-Egypt" produced over 400 vehicles LADA 2107 and LADA 110. Its official opening was held on February 21, 2006.
In 2005, OJSC "AVTOVAZ" produced and delivered to LADA-Egypt over 2,200 automobile sets LADA 2107 and LADA 110 in total. The plan for 2006 stipulates for production and shipment of over 3 300 automobile sets to Cairo.
The assembly cooperation of OJSC "AVTOVAZ" and company LADA-Egypt started in 2002 with production of automobile sets of LADA 2107. Approximately 5 thousand pieces were produced to the opening of a new enterprise. Current capacities give LADA-Egypt an opportunity to increase the volume of production and produce different models of LADA vehicles.
EGYPT GAFI COOPERATES WITH GAID TO BOOST INVESTMENT Source: InfoProd, April 17, 2006
“The General Authority for Investment and Free Zone (GAFI)(link here) and the General Authority for Industrial Development (GAID) are implementing a program to boost investments in free zones in different governorates, and lure capital and modern technology to be used in new projects,” said GAFI chairman Ziad BahaaEddin.
The program includes signing cooperation agreements between GAFI and investors’ associations at governorates with the aim of activating their role in meeting investors’ needs, solving their problems and providing data on investment opportunities available in various fields. The program also aims at restructuring and developing Investment Authority offices, he said.
EGYPT $192 MILLION COTTON EXPORTS LAST YEAR Source: Asia Africa Intelligence Wire, April 17, 2006
According to Al-Sharq Al-Awsat Newspaper (April 16, 2006), a recently issued report by the Egyptian Exporters Association shows that the value of Egypt's cotton exports hit $192 million last year.
The report shows that seven Asian countries had absorbed 54% of Egypt's total cotton exports last year, of which 22% by India, 20% by Pakistan and 12% by China.
ARAB BANK TO EXPAND EGYPTION OPERATION Source: Asia Pulse, April 24, 2006
The Arab Bank (AmCham Member)(link here)is planning to expand its activities in the Egyptian market. Arab Bank Chief Executive Officer Abdul Hamid Shoman has a held a meeting with Egyptian Prime Minister Ahmed Nazif in Cairo to discuss issues concerning the expansion of the bank’s presence and its activities in the Egyptian market.
The bank has 11 branches in Egypt, seven of which are located in Cairo. Five more are expected to be opened this year as part of a progressive plan to reach 30 branches in the next two years. The bank opened its first Egyptian branch in 1944.
The bank has opened the door for exploring various investment opportunities in Egypt, in accordance with the bank’s plans to build on its existing base in one of the most important Arab economic hubs, said Shoman.
Compiled by: Business Studies & Analysis Center E-mail: Studies@amcham.org.eg If you want to receive this bulletin on a regular basis, fill out this form
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