Deutsche Bank is holding a call right now on Egypt, and we’re eavesdropping.
Mostly right now they’re going through headlines:
- Several members of Muslim Brotherhood detained.
- At least 1000 detained overall.
- There are reports of security forces having disobeyed the regime in Alexandria.
Options for the government:
- NPD convention in May might allow for Mubarak to announce that neither he nor his son will continue.
- Government may try increasing the minimum wage.
- Government may revise the existing subsidy scheme.
- It’s not all that obvious that we could have permanent calm.
Now talking markets:
- Currency markets not moved wildly. Very much so on equities.
- The optimistic economic story derived from a few sources: 1) favourable demographics. 2) Egyptian economic can achieve high growth rates, with a relatively low current account deficit.
- Economic weakness: Ugly deficit situations. Obviously high inflation.
- This crisis may have a “silver lining” and lay the groundwork for advance and reforms.
Q: If we do get regime change, what would the new government look like, and would existing business relationships last.
A: Difficult questions to answer. With respect to commercial transactions, analyst is highly confident that they would remain in place.
Q: When was the last comparable event?
A: Nothing like this in ages.
Q: What per cent of the population does this involve?
A: A lot.
Q: What role does the Muslim Brotherhood play in all this?
A: Not clear.
Q: What’s the status of the army?
A: No guidance. I think the army is very loyal to the current regime, especially in the senior ranks. The Chief of Staff is a longtime supporter of Mr. Mubarak.
And the call concludes.
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