All posts tagged africa

Egypt Imports More Than It Exports …Trade Deficit Grows

THE CENTRAL BANK OF EGYPT (CBE) released Balance of Payments (BOP) figures for the first half of FY2007/2008 (July to December 2007). The merchandise trade deficit rose to $11.3 billion, up 71% from $6.6 billion in 1H FY2006/2007. Exports grew strongly, by 22.8% year-on-year (Y-o-Y) to $13.1 billion, but were outpaced by the growth in imports, which rose by 41.2% Y-o-Y to $24.4 billion, a reflection of both Egypt’s strong economic growth and increasing demand for some goods, but also by global price rises in commodities, amongst other items. Tourism receipts climbed to $5.6 billion in 1H FY2007/2008, up from $4.3 billion a year before, and workers’ remittances also showed very strong growth, rising to $4.0 billion, from $2.7 billion in 1H FY2006/2007. The Current Account registered a deficit of $245.7 million, down from a surplus of $1.9 billion in I H FY2006/2007. The net inflow of Foreign Direct Investments in the first half of FY2007/2008 rose to $7.8 billion versus $7.2 billion last year. The overall balance achieved a surplus of $3.1 billion in 1H FYO7/08 versus $2.9 billion in the corresponding period in 2007. Egypt’s Net International Reserves (NIR) registered a new high of $$32.9 billion at the end of February 2008, up from $32.1 billion in January 2008. NIR had been rising steadily since October 2004 when they registered $14.8 billion. The increase in NIR could be due to the inflow of foreign currency from the execution of the sale of the cement arm of Orascom Construction Industries (Am Cham member) to Lafarge and to portfolio investments targeting the Egyptian stock market.

Etisalat Unveils Mobile Phone Network in Nigeria

ETISALAT, NIGERIA’S FIFTH MOBILE phone company, has unveiled its new network. Hakeem Bello-Osagie, chairman of Emerging Markets Telecommunications Services, or EMTS, owners of the license operated by Etisalat, said that the company is expected to use a marketing strategy of reduced tariffs to take market share from established operators in Nigeria. EMTS, a Nigerian firm, entered into partnership with Mubadala Development Co. of the United Arab Emirates following Mubadala’ s acquisition of a Unified Access License that includes a mobile phone license from the Nigerian government in January 2007 for $400 million. Etisalat has acquired a 40% stake in EMTS and operates the license in Nigeria. Saoud Al Shamsi, Etisalat’s chief executive officer, said the company has built a network that spans the Middle East, Africa and Asia. Nigeria has more than 40 million mobile phone subscribers. Operators include MTN, Globacom, Celtel and Visafone.

LITERACY: Moroccan Book Fair promotes women’s literature

THE MOROCCAN CITY OF FEZ HOSTED  A book fair devoted to women writers in early March 2008. Dozens of Moroccan writers, poet and literary publishers convened March 7th in Fez for the first-ever Women’s Book Fair. The event offered Moroccans the chance to meet writers and discuss gender issues, as well as enjoying various theatrical and musical displays. Female academic’ students, activists, journalists and housewives attended the two-day event entitled “Female Writers of Yesterday and Today”. Feminine Creativity Association, one of the oldest defenders of women’s rights in Morocco, co-sponsored the event with the Mubadarat (Initiatives) Association “We felt that women’s creative writings, when so highlighted, become significantly prominent. However, when they are presented in a joint spat with men’s writings, the latter’s writings dominate,” Tanana said. “In ordinary book fairs, important women’s books would be kept on shelves. They don’t appear amidst the congestion of writings,” Roughly 85% of attendance was Moroccan and Arab female writers.

AGRICULTURE: Nigeria to get $38million loan for agric development

NIGERIA’S DECISION-MAKING FEDERAL Executive Council (FEC) has approved total loan package of $37.9 million for the development of the agriculture sector and poverty eradication in the country. The Rome- based International Fund for Agricultural Development (IFAD) will contribute $27.78 million, representing 67.8 per cent of the total loan, as well as a total grant of $386,800 towards the initiative. The Ford Foundation will provide a total grant of $500,000, the Nigerian government $6.17 million (15 per cent of the loan), the participating institutions $4.762 million and the beneficiaries (farmers) $785,100. The interest- free loan, payable over 40 years, has a moratorium on payment of 10 years, but will attract a service charge of 0.75% of the amount outstanding. The loan is aimed at the execution of a programme that will grant rural farmers direct access to credit. Some 345,000 beneficiaries from 23 of the country’s 36 states will benefit from the programme.

Nassef Sawiris Has Even Grown Richer, Selling Orascom Cement To Lafarge

THE FIRST SEEDS OF THE ORASCOM DEAL were sown at a conference in London, where Bruno Lafont, chief executive of Lafarge, the world’s largest cement company, spoke alongside NassefSawiris, a member of Egypt’s richest family and chief executive of Orascom Cement. “There were two speakers in the cement sector and we were sitting close together,” Lafont explains with a Gallic laugh. “We had never met before. I was interested to know how [Orascorn] was doing business. What was he doing differently from us? I spent five years in Turkey and I learned there that entrepreneurs can have different approaches that can be extremely smart.”

Lafont and Sawiris met again last summer. Lafont was impressed that Orascom had begun as a local, general construction business and was therefore able to anticipate demand for materials much earlier than Lafarge. Orascom had a presence in Egypt, Algeria, northern Iraq, the UAE and Pakistan and has plants under construction in Saudi Arabia, Syria, Nigeria, South Africa, North Korea and Turkey. Lafarge, by contrast, was only in Egypt and Turkey, though it had announced plans to build 45m tones of new cement capacity — about 25 new plants — in 20 countries, mostly emerging market by 2010. But Orascom would give Lafarge another 45m tones of cement capacity by the same date. Little surprise then that a takeover was decided upon. The deal includes $40MM equity, and leaves Sawiris with an 11.4% stake in Lafarge. Shares in Lafarge, a leading member of the CAC 40, rose 13% on the announcement as investors and analysts backed the deal.

-From Business, a UK Weekly, January 3-8, 2008

Blood Money Fuels The African Economy

By Toyin Akinosho

THE VERYTOP OF THE LISTING ON THE Cairo and Alexandria Stock Exchange (CASE) is Orascom Telecommunications, 57% of which is owned by the Sawiris family. Next on the list is Orascom Construction, almost 70% owned by the same family. The third largest company on CASE, Africa’s second largest stock exchange, is another family owned company, which doesn’t have anything to do with the Sawiris. Abdel-Azziz Ezz is the chairman and managing director of both Alexandria National Iron and Steel(ANSDK), which is Number 3 on the CASE top 10 and Ezz Steel Rebars (Ezz Steel), which shows up on Number 9.

To understand how significant these four, family owned companies mean to the size of the Egyptian economy, we must understand this:

Egypt’s top 10 companies on the CASE make half the money on the exchange and if an exchange is a barometer of the health of an economy, then it means they simply dominate the economy. Whereas combined net profits for bt100-Egypt’s largest and most actively traded 100 stocks-grew to $2,457 billion in 2004 from $1,487 billion, the gulf between the top 10 and the rest of the list continued to widen.  With combined revenues of $8,980 billion in 2004, the top 10 accounted for 57.91% of bt100’s revenues, and their $1,381 billion in net profit was 56.19% of bt 100 profits.

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