Egypt: Qatar loan puts IMF on hold
On the face of it, for a crunch week, Egypt has had a better time than usual.
The IMF is in town for talks on a $4.8bn (or more) loan; March inflation figures showed an improvement. And to top it all, on Wednesday it was announced that Qatar was stumping up another $3bn for the country.
But dig a little more, and there are worrying signs ahead. Continue reading »
Mohamed Morsi, Egypt’s Islamist president, has called parliamentary elections to start on April 27 and to be held over four stages, culminating in late June.
Mr Morsi and his Muslim Brotherhood group are hoping the poll will help restore stability and arrest economic deterioration in a turbulent country rocked by protests and periodic violence. Continue reading »
Egypt: in search of stability
January 2013 will mark the two year anniversary of the Egyptian uprisings which overthrew Hosni Mubarak. Amid the optimism which followed the transition to democracy, few serious analysts expected the path ahead for the country to be smooth, and indeed it has not been. An FT special report on Egypt highlights the challenges faced by the Arab world’s largest democracy. Continue reading »
Egypt: Morsi’s second U-turn in two days
“Like a train without a driver” is how one commentator described Egypt after President Mohamed Morsi’s latest policy U-turn, scrapping a planned increase in taxation. In a different vein, one joke doing the rounds in Cairo has doctors telling Morsi that, like a pregnant woman at risk of miscarriage, he should lie down for a few weeks to let his decisions take hold.
But there is a grimness to the humour. Stocks and the currency fell on Monday as the air of uncertainty became pervasive. With government supporters and the opposition preparing fresh rallies before Saturday’s controversial referendum on a new constitution, the danger of further violent unrest is rising. Continue reading »
Egypt: stocks soar on Morsi retreat
Egyptian equities jumped 4.4 per cent on Sunday after president Mohamed Morsi rescinded the controversial decree in which he extended his powers and plunged the country into a new wave of protests.
Investors clearly hope that Morsi has done sufficient to restore enough stability for the International Monetary Fund to implement its crucial planned $4.8bn loan. But has he? The opposition doesn’t think so – it is still demanding a delay on the planned December 15 constitutional referendum. Watch out for more seesawing in the markets, as the Islamists and the opposition fight it out. Continue reading »
Egypt: investors nervous as politicians prepare new constitution
With Egypt on political tenterhooks on Thursday as president Mohamed Morsi prepared to address the nation, investors were understandably nervous.
Egyptian shares slumped 2.6 per cent at the opening before recovering slightly to trade 0.9 per cent down on the day, and have lost 12.3 per cent since Morsi (pictured) last week precipitated the latest crisis by assuming increased powers. Continue reading »
Egypt: market falls on political tension
Source: Egyptian Exchange
Egypt’s political leaders are raising the temperature – and the stock market is wilting in the heat.
The EGX30 index fell 4.6 per cent on Wednesday, as the Constitutional Court threw down the gauntlet to president Mohamed Morsi saying it would not intimidated after he last week unilaterally exempted all his decisions from judicial view. Continue reading »
Egypt: market stabilises – for now
Egypt’s stock market seems to have stabilised since its dramatic 9.6 per cent fall on Sunday, triggered by the latest round of political turmoil. On Monday, the EGX30 index rose 2.6 per cent and was trading flat in the early afternoon, Cairo time, on Tuesday.
But the political confrontations of the last few days are a reminder that Egypt’s leaders are a long way from giving priority to the economy. The International Monetary Fund programme announced last week is anything but a done deal. Continue reading »
Egypt: shares plunge as investors assess economic impact of protests
Investors have punished Egyptian president Mohamed Morsi for his power grab. Egypt’s benchmark equity index plunged 9.6 per cent on Sunday, the first trading day since Morsi’s decision to award himself sweeping new powers prompted nationwide demonstrations.
That still leaves Egyptian shares over 35 per cent up on the year. But it won’t take long to lose more of those gains if there is any doubt about the implementation of the International Monetary Fund programme announced last week. Without it, Egypt will face an immediate financial crisis. Continue reading »
Egypt protests could raise questions over investor confidence
Investors cheered this week when Egypt announced it was ready to sign up to an International Monetary Fund programme that includes extensive fiscal and structural reforms. And they cheered again when newly-elected president Mohamed Morsi made such a significant contribution to the Gaza ceasefire.
But they may stop cheering following a controversial decision to boost his presidential powers that has prompted protests across Egypt. A salutary reminder that however pressing the economic challenges, in Egypt politics comes first. Continue reading »
Egypt’s credit rating: stable, for now
With the IMF in town, Egypt’s finances have been under the spotlight this week. Standard and Poor’s have chipped in to the discussion with the release of their credit rating for the country.
The good news: Egypt has been taken off S&P’s CreditWatch, where it was placed on June 25 following feuding between SCAF and Islamist politicians which led to the dissolution of parliament on June 14. It has also had its long and short-term B/B rating affirmed. The bad news: despite a modicum of stability recently, it remains on negative outlook. Continue reading »
[video] Egypt’s military relegated
Egypt’s first elected civilian president, Mohamed Morsi, has forcibly resigned a number of senior military staff, marking a turning point in the country’s transition from the old regime of Hosni Mubarak. But what does the move mean for the army and are fears of President Morsi’s increasing powers well-founded? Seb Morton-Clark reports.
Egypt-IMF: more money, more likely?
Egypt’s proposed deal with the International Monetary Fund has been in the “maybe” category for many months – but there were strong indications this week that the deal will be done.
The positive signs are from both sides. First, the IMF announced that its managing director, Christine Lagarde, would be visiting the country. Then Momtaz al Saeed, the finance minster, told reporters that the country would be looking for $4.8bn, up from the $3.2bn that had been mooted since last year. Continue reading »
Egypt: investors welcome Morsi gambit
Investors have broadly welcomed Egyptian president Mohamed Morsi’s bid to assert his power over the country’s strong military leaders.
Egyptian equities rose 1.5 per cent on Monday after Sunday’s dramatic announcements and the central bank successfully completed a regular bond auction that netted 5.1bn Egyptian pounds, 100m more than planned.
But the latest developments don’t herald the end of the long-running political conflict between the Muslim Brotherhood backing Morsi and the army. The president has won an important battle but he has not won the war. Continue reading »
Egypt’s new cabinet: short-termism wins over forward planning
Maintaining the status quo, short-termism and a failure to address Egypt’s need for change and reform. That seems to be the promise of Egypt’s new cabinet, sworn in on Thursday after a deal was struck between the country’s military and its new president, Mohammed Morsi of the Muslim Brotherhood. Continue reading »
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