Cairo seemed like the coldest place in the world in January, and all those heaters suddenly getting their yearly workout has apparently got government bigwigs thinking even harder about energy subsidies. Rumor has it that the latest scheme being floated around the ministries is a coupon-style system, under which the price of gas will double, potentially triple, bringing it closer in line to the actual cost of the fuel. To keep things from getting too crazy, eligible motorists will be issued a monthly coupon that entitles them to a set amount of gas at somewhere close to the old, subsidized prices.
Sounds quite like the American food-stamp system to us the subsidy helps those for whom gas makes up a large part of their expenses (i.e. the poor), doesn't make much of a difference to the rich, and does not subsidize bigger fuel consumers. And looking at the waistlines of the average Americans, rich and poor, it seems like the system keeps everyone well fed.
It's not just the Americans who are inspiring to government technocrats these days. Rumor has it that a London-style congestion charge where cars entering the inner city must pay a set fee is being considered for inner Cairo in a bid to ease the crippling traffic of late.
Gee, we can imagine that system will be easy to implement. Yes, no complications that come into mind. Sounds about as easy banning smoking
With all these new initiatives to manage the country the way it's done in the US and UK, won't the government need some better talent in its ranks? No problems. Rumor has it that a state-administered endowment fund is being established that will send Egypt's best and brightest to Harvard. The John F. Kennedy School of Government there is supposedly the best in the world, but could even that great institution handle the daunting challenge of reinventing the civil service corps?
Hot on the heels of Sheraton vacating three of its prime Cairo properties in the past couple of years, the chain has been forced out of Heliopolis, Royal Garden and Gezirah comes news that the Mövenpick, which has lost properties in Luxor and Sharm El-Sheikh, is on the verge of announcing two new hotel developments. Perhaps they might be located in what rumor has it will be "Sharm El-Sheikh, Part Two," an upcoming mega-development that, little birdies tell us, will be driven by Dubai-based giant Tameer.
Tameer isn't the only Gulf investor rumored to be preparing to park a big schoolbus full of petrodollars here in Egypt rumor has it that the National Bank of Kuwait has its heart set on becoming the government-anointed strategic investor in Banque du Caire.
Still, it may have tough competition from what rumor has it will be a new "national champion" on the local banking scene: The merged CIB and AAIB, should in-progress due diligence talks soon wrap.
Most talkative of all this month were people in the IT and telecoms sector, who flooded the rumor desk with a deluge of whispers. If the rumormongers are right, Mobinil may soon be rebranded as Orange, reflecting the expansionary ambitions of France Télécom, partner in Mobinil and owner of the globally successful Orange brand. The company already operates a significant international back-office out in Stars Center and has a friendly relationship with Orascom Telecom, its joint-venture partner in Mobinil. Are those rumors of Sawiris preparing to exit his ownership in OT partially on the mark? We doubt it, but it's the talk of the town after his brother Nassef sold Orascom Construction Industries cement holdings to Lafarge.
For hundreds of years France and Germany used to invade each other on a monthly basis, but all is now well between the two giant neighbors that bankroll the EU. They are now acting in such synergy together that even their privatized, formerly state-owned telecom companies seem to hunt as a pack.
While France Télécom is looking to snap up Mobinil, rumor has it that Deutsche Telekom, owner of the T-Mobile brand, is taking a long hard look at the second fixed-line operator's license to be sold this year. It would be the Germans' first experiment in operating outside of warm, comfy Europe, and rumor has it the company is concerned about doing business the "Egyptian way."
With these foreign operators looking to muscle their way into the country, Telecom Egypt looked to do a bit of muscling of its own. Only it was a bit premature with the announcements, with a TE official telling the press that his company had acquired ISPs NileOnline and EgyNet. Only problem? It hadn't, and NileOnline told the press that although the companies were in talks, nothing was yet finalized.
Timing is everything, folks.
© Business Today Egypt 2008
