Why Egypt becomes IT hub for the software

Why Egypt becomes IT hub for the software

Egypt has an excellent opportunity to establish a relatively small but effective software industry. The potential is already there and growing but could be extended way beyond the current levels. The efforts and support enabled by the government, industry, financial institutions and the educational system will ultimately determine the level of development and success of the industry making it an effective contributor to Egypt’s economic development.

 

The software industry in Egypt is still in its first stage.

However, it is diverse and heterogeneous in nature with the presence of local vendors and multinationals about 28% of its population, who are enrolled in education programs (schools and universities education) and 19 million represent its workforce (www.idsc.gov.eg).

Pro-business government policies and regulations have helped grow the software industry and have encouraged a number of multinationals to invest in Egypt including, but not limited to, the likes of IBM, Intel, Valeo and Oracle that have invested substantially in setting-up facilities and grew their operations.

Since 2005, there has been various efforts and steps taken to position Egypt as an alternative location for investment in intellectual capital as well as offering software development, business process outsourcing and call center services. This has led Egypt to invest in accelerating its high-tech infrastructure by developing technology parks with over 130 multinational company in the areas of ICT, software development, outsourcing and call centers.

 

Following analysis describes Strengths & Opportunities points of Software industry in Egypt:

 

Strengths:

  • Growing generation of well-educated fresh graduates interested in the fields of information technology.
  • Accumulated, though limited, experience, technical skills and capacities in the industry.
    Young, educated and competitive workforce with required knowledge.
  • Low and competitive labor costs.
  • Other languages are also learnt, such as French and Spanish.
  • Same time zone advantage with Europe and possibility of a second shift for the United States.
  • Geographically well located for most African and European cities and some Asian countries.
  • No shortage of entrepreneurs willing to take risks in the development of their businesses.
  • Encouragement of the government by facilitating procedures and logistics related to the software industry.

 

Opportunities:

  • Creation of software business incubators such as the smart villages’ model.
  • More proactive role played by educational institutions and training centers.
  • Internships and scholarships from software vendors both local and multinationals.
  • Promotional role played by software associations to activate the role of software development companies.
  • Government support role needs to be more at the macro and micro levels.
  • Changes in tax treatment, reduction on telephone tariffs and the introduction of new IP laws.

 

Since 2005, there has been various efforts and steps taken to position Egypt as an alternative location for investment in intellectual capital as well as offering software development, business process outsourcing and call center services. This has led Egypt to invest in accelerating its high-tech infrastructure by developing technology parks with over 130 multinational company in the areas of ICT, software development, outsourcing and call centers.