Egypt looks to capitalise on booming ICT market

Egypt’s Information Technology Industry Development Agency (ITIDA) is looking to reinforce the country’s growing reputation as an ICT hotbed at GITEX Technology Week. ITIDA CEO Dr. Hazem Abdel Azeim reveals the organisation's plans to further develop Egypt's IT export market and edge ahead of India and Eastern Europe.

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By  Administrator Published  October 21, 2008

Egypt’s Information Technology Industry Development Agency (ITIDA) is looking to reinforce the country’s growing reputation as an ICT hotbed at GITEX Technology Week. ITIDA CEO Dr. Hazem Abdel Azeim reveals the organisation's plans to further develop Egypt's IT export market and edge ahead of India and Eastern Europe.

Tell us about ITIDA. Why was it formed and what is its mission?

ITIDA is a governmental entity spearheading the development of the Egyptian IT sector. ITIDA is the arm of the Ministry of Communications and Information Technology tasked with developing the IT industry through identifying the needs of the local industry and addressing them with tailored programmes. ITIDA is a one-stop-shop for foreign investors and a strategic advisor to multinational companies investing in the Egyptian IT sector. It is also a self-sustainable agency that plays a leading role in enhancing the Egyptian cyber-security and data protection framework towards a more secure e-business and business process outsourcing services positioning.

The global outsourcing market is a competitive arena. What makes Egypt a viable outsourcing destination?

In recent years, Egypt has undergone record development in the ICT sector and is now one of the most attractive, dynamic and fast-growing locations for outsourcing communications and technology in the world. Linking the East to the West in terms of language, culture, geography and infrastructure, Egypt is an asset for any investor who wishes to tap into the business benefits of the region.

India and Eastern Europe occupy strong positions on the global outsourcing stage. Are you confident that you can compete with established locations as these?

Egypt is able to offer cost-effective business process outsourcing services due to its robust infrastructure, low telecom costs with VoIP services and some of the lowest internet rates in the world — undercutting India and Bulgaria. Egypt’s government hopes to increase bandwidth, internet penetration, fixed line and mobile phone use, WiFi, WiMax and broadband services while providing free internet access and government programmes in schools, universities and IT clubs. Egypt’s highly motivated and multilingual labour pool reinforces the country’s ability to deliver top-class business process outsourcing solutions, creating an investment zone with government telecoms incentives, training and competitive pricing in support of intelligent investments.

Is Egypt’s geographical location an advantage when it comes to promoting its outsourcing capabilities?

Egypt is on the border between north-east Africa and south-west Asia with its northern border in the Mediterranean so its geographical position — near Europe and accessible from both the East and West — makes it ideal for outsourcing operations. There is an average four-hour flight time to most European capitals and a similar time zone so the proximity to Europe supports advantageous business partnerships. In addition, Egypt is geographically closer to North America than India and the Philippines, and near the Gulf, Asia and Africa. As an intercontinental business destination, it has access to a number of world markets on the strength of its location alone.

What are you doing to attract foreign investment?

In order to attract direct foreign investment various packages of incentives and subsidies are offered, for which Egypt and its outsourcing partners enjoy key advantages. To increase Egypt’s attractiveness in the commercial environment, the government has introduced anti-trust and unified tax laws, tariffs on ICT imports and addressed many of the legislative, trade and non-trade barriers to building a strong ICT industry. Egypt’s government also offers tax exemption to companies investing in its infrastructure. These steps are coupled with financial sector reforms, which are being brought in line with international standards. In order to aid IT businesses at ground level, the minimum capital requirement to start a business has been cut from $9,000 to $200. Last year, 27 Egyptian companies had capability maturity model (CMM) or capability maturity model integration (CMMi) certification, with several achieving level five — the highest level of certification ensuring quality output.

How much talent do you need to support your outsourcing vision? Are there graduates coming through the universities and institutions at the moment?

In the interest of enhancing the capacities of Egypt’s graduates, the Ministry of Communications and Information Technology set up a programme with the Information Technology Institute in Cairo, which trains up to 1,000 graduates every year. It is responsible for the execution of the ‘EduEgypt’ initiative which involves training university graduates on the soft, technical and language skills required for the business process outsourcing and call centre industries. The initiative produced 3,000 graduates in its first year and aims to supply the market with 40,000 graduates a year by 2011.

The ‘Smart Village’ trade zone in Cairo appears to have been successful in attracting many of the world’s top technology companies. How important is this hub to your ICT and outsourcing ambitions?

The Smart Village offers a state-of-the-art modern infrastructure with facilities for more than 35,000 people over 600 acres. Additional Smart Village offices are being planned for Alexandria and Damietta to accommodate Egypt’s expanding ICT industry. The Maadi Contact Centre Park, which will be Egypt’s first dedicated call centre park, is also being built in Cairo and will offer a further 60,000 seats when it is operational in 2012. The two parks will work together to create a dynamic platform for local and international communities to outsource world-class ICT technology services.

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