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Mon 10 Jan 2011 01:38 PM

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Egypt plans $15m funding push to buff up private tech firms

Move is part of aggressive plan to expand Egypt's IT sector to $3bn by 2015, establish outsourcing hub

Egypt plans $15m funding push to buff up private tech firms
Egypts government is pushing to establish Cairo as an outsourcing hub, generating $3bn in revenue by 2015

Egypt’s government is funding a $15m push to coach local technology companies on how to rival foreign IT firms, a top official said in an interview in Cairo.

Yasser El-Kady, the CEO of ITIDA, the Information Technology Industry Development Agency which serves as the government’s point-of-contact for foreign tech companies looking to enter the Egyptian market, told Arabian Business that IT services consultancy Atos Origin is already working with 100 companies in his country.

The move forms part of the government’s continued long-armed support of its fledgling information technology sector. Outsourcing revenue is currently estimated at $1.1bn. El-Kady said he wanted to hit $3bn by 2015.

Part of how it will do that is by attracting more foreign investment. Another, crucial step is making its own locally-grown companies players on the global level.

“We’ve hired consultants to come focus on Egyptian companies – to brand them on a world standard level,” he said. “We’re looking at company structure, how they can build a business plan and focus on HR development.

“We want to take [their standard] outside of Egypt and put them on a level with Europe.”

The cost of the branding push is so far estimated at $15m.

He said the government was also hoping to start a ‘Go to Africa’ programme, similar to its previous scheme, ‘Go to GCC’, calling on technology companies in the Gulf to work with Egypt as an outsourcer.

“We want to help out IT companies grow and develop into bigger markets,” he said. “The Egyptian market has limitations, so I have to take them outside – to the GCC and [now] to Africa.”

He said the Egyptian government would throw its full support behind expansion of its technology sector

“They’ll have strategic political support – we are enabling the companies, trying to have them work together,” he said. “Are they going to go together or as a solo? If you go in together, you have a higher chance of success, and less risk.”

The Egyptian government began its quest to become an outsourcing hub just 12 years ago, in 1999.

Taha Khalifa, the general manager for Intel Egypt, said that he arrived in Cairo in 2001, with one assistant – as the company’s only employee. With government support, he said Intel had swelled to nearly 70 employees, all Egyptian.

He credited the government with the quick expansion.

“There’s a lot of collaboration in the IT community, and the credit for that goes to the MCIT [Ministry of Communications and Information technology] because they put us together and said, ‘work together first on outsourcing’ – and we succeeded at that – ‘and now comes the innovation.’ The feeling is that we’re all working.”

 

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