Investors update: August 28 2023 - Network International invests $32m to expand Egypt operations.

Network International invests $32m to expand Egypt operations 

Highlights

• Network International, an e-payment solutions provider across the Middle East and Africa (MEA), has pumped $32 million in investments to ramp up digital payment solutions in Egypt.
• A large part of the investment will be allocated to acquiring, installing, and maintaining about 100,000 advanced Point-of-Sale (POS) machines.
• The rest of the investment will be directed to the implementation and smooth operation of Network One, the company’s payments technology platform.

Source: Zawya

Our Takeaway

Fintechs —across several verticals—have enormous potential in Egypt, a country where 2 of every 3 individuals are partly or totally excluded from formal financial services but 50% of its 100 million people actively use smartphones. In addition to high mobile and internet penetration, the North African country boasts a young and tech-savvy population with 61% below 30. That explains why a huge financial services company like Network International, is doubling on investments in the North African nation, thereby helping to further drive the booming fintech sector.

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Nigeria’s GDP records 11th consecutive quarter of growth

Highlights

• Nigeria’s annual economic growth rate slowed to 2.51% in the second quarter, hurt by a fall in oil production amid a series of reforms by new president Bola Tinubu aimed at reviving Africa’s largest economy.
• The data, which marks the 11th consecutive quarter of growth, is the first release since Tinubu embarked on the country’s boldest reforms in decades.
• A popular but costly petrol subsidy is gone while foreign exchange trading restrictions have been lifted. But the action has worsened inflation currently in double-digits, fuelling anger and frustration among the population.

Source: Nairametrics

Our Takeaway

Nigeria, Africa’s top oil producer, recorded an average daily oil output of 1.22 million barrels per day (mbpd) in the second quarter, down from the daily average of 1.43 mbpd registered in the same quarter of 2022. The dominant oil sector which accounts for the bulk of government revenue and 90% of foreign-exchange reserves, contracted 13.43%. The NBS said second-quarter growth was driven by the services sector, which grew 4.42% year on year.

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EGX stocks hit record high as investors seek to offset inflation

Highlights

• Egypt’s benchmark stock index hit a record high last week, spurred by investors looking to hedge against surging inflation driven by a series of currency devaluations and the fallout from Russia’s invasion of Ukraine.
• The Egyptian Stock Exchange’s blue-chip index climbed 1.7%, as most of the stocks on the index were in positive territory.
• Egypt hopes its imminent inclusion in the BRICS bloc of developing nations will help ease its shortage of foreign currency and attract new investment, but analysts say it may take time before any benefits appear.

Source: Bloomberg

Our Takeaway

Most stock markets in the Gulf and by extension North Africa ended higher on Sunday after U.S. Fed Chair Jerome Powell said at the end of last week that the Federal Reserve does not think the inflation fight is over but that it will proceed “carefully” in its next move. Oil and gas exporting countries in the Gulf tend to follow the Fed’s rate moves, as most regional currencies are pegged to the U.S. dollar.