CAIRO: Dairy producers announced plans last week to raise cheese prices by 12 to 15 percent over the next six months to keep up with inflation in other sectors.
Mohamed Kamel, sector head at the Food Industries Division (FID) of the Federation of Egyptian Industries, said rising costs in parallel sectors has made it impossible for producers to continue selling their products at old prices.
Despite the inflation rate reaching 12.4 percent at the end of December, dairy products have generally maintained their prices. Since June 2006, non-pasteurized milk, for example has increased by just LE0.25 per kilo to LE 2.75.
Following a producers meeting Wednesday, Kamel said price increases will be implemented gradually to avoid shocking the market.
Earlier this month, the Monetary Policy Committee decided in its monthly meeting to maintain overnight lending and deposit rates at 8.75 and 10.75, respectively, despite wide analyst expectation of another raise to counter rising inflation. Food products account for nearly 40 percent of the consumer price index used by the Central Bank to determine the annual inflation rate.
Mubarak insists National Bank of Egypt and Banque Misr remain under government authority
CAIRO: In a meeting with the economic cabinet Tuesday, President Hosni Mubarak emphasized the importance of keeping the National Bank of Egypt (NBE) and Banque Misr under public ownership.
Both banks have been under sizable restructuring campaigns, even prior to the sale of the Bank of Alexandria in August. Banque Misr is scheduled to complete its merger with Banque du Caire this year, a process that will cost the government LE 11 billion and create the state s largest financial institution with an estimated LE 136 billion in assets.
Mubarak said restructuring of NBE and Banque Misr, including settling non-performing loans of public companies, should be aimed at developing and modernizing both banks to compete with the increasing role of the private sector as a result of privatization of other banks.
The government is now working on the second phase of settling public company debt after paying off LE 6.9 billion prior to the sale of BOA. The phase, to be financed entirely using the LE 9.2 billion earnedfrom the auctioning off of BOA, will settle the debts of 46 companies, bringing down public company debts to almost LE 10 billion.
Al Ezz Steel Rebars proposes LE 2.7 billion capital increase
CAIRO: Al Ezz Steel Rebars (ESR) announced last week it will call its general assembly to a meeting Feb. 17 to discuss a LE 2.7 billion capital increase by way of issuing 50 million new shares.
The proceeds will be used to finance a new electric arc furnace to raise the company s flat steel production to 3 million tons per year, and to build a new direct reduced iron plant with a productioncapacity of 1.7 million tons per year. The company s expansion is expected to cost about LE 3 billion, with plans for production to start in mid-2009.
ESR, who controls an estimated 60 percent to 70 percent of the local market, has been under investigation by the newly-formed Competition Commission for possible exercise of monopolistic practices, but no further announcements have been made by the commission.
After increasing its share in Alexandria National Iron and Steel Company in 2006 from 21 percent to 50 percent, ESR became the largest sector producer in the Middle East. The company s final 2006 earnings have not yet been released, but consolidated 3Q 2006 figures show LE 739 million in net income on LE 7.9 billion in revenues.