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'Egypt positioning itself as Africa's tech hub'

Egypt positioning itself as Africa’s tech hub.

Egypt is gearing up its skilled workforce to take advantage of Africa's growing demand for cost-effective technology solutions.

Earlier this year, the Egyptian government's Information Technology Industry Development Agency (ITIDA) announced the "Africa Together" initiative in partnership with the International Data Corporation (IDC).

The initiative is aimed at supporting growth in the country's information and communications technology (ICT) sector and transforming it into a key contributor to Egypt's economy.

According to the IDC, initiatives such as the Africa Together programme will contribute $6.5 billion in 2015 to Egypt's ICT market.

Meanwhile, Egypt's minister of communications and technology has said that mostly private investments into ICT of up to $18.5 billion is forecast to lead to 19% growth in the sector, contributing to a 7% rise in gross domestic product by 2020.

Speaking to ITWeb Africa, ITIDA and IDC said that with demand for ICT solutions growing from across Africa's markets, Egypt's IT-skilled workforce and ability to provide cost effective solutions position it ideally to answer demand from across Africa, and ultimately achieve this forecast economic growth.

"We believe that the next large opportunity lies within emerging Africa," Margaret Adam of the IDC's Middle East, Turkey and Africa unit told ITWeb Africa.

"Economic growth, country transformation and foreign investment are increasing across the continent, presenting a number of opportunities for IT investment. However, the pace of this growth comes with its challenges, particularly in light of the fact that most of these markets face critical shortages in terms of technology skills and only a handful of domestic African IT companies can scale sufficiently to support very large, transformative projects," said Adam.

"Egypt's proximity to many of these markets, time zone affinity and often very cost effective solutions and skills, make for close alignment to the needs of these markets," Adam said.

Meanwhile, ITIDA have said that intra-African business projects have taken priority in Egypt's foreign policy.

"Egypt' ICT strategy is a multi-dimension one with targeted markets [...] One of these markets is Africa which is home to seven of the world's fastest-growing economies and a land of competition for all and still offers the best returns to any investor due to the considerable demand that exists across the wider African continent for skills and knowledge transfer,"

"All these factors make it an extremely appealing prospect for ITIDA and the Egyptian ICT companies to penetrate high-growth markets across the African continent," ITIDA said.

According to ITIDA, Egypt's ICT sector is robust and active thanks to the government's dedication to develop a pro-business environment, including through the establishment of a range of incentives and subsidies.

Alongside the business environment, Egypt's geographic location, the competitive cost of operations, the multi-lingual talent pool and the availability of quality, scalable infrastructure all play to its advantage, ITIDA says, and has resulted in there being a host of both small and larger established ICT businesses ready to service demand from across Africa.

However, both ITIDA and IDC agree competition to "take" the African market is fierce, and players must stay upbeat and flexible if they are to retain pan-African custom.

"There is fierce global competition from both established markets as well as other emerging markets. Many countries are aggressively developing their ICT sectors to become more globally competitive as well as putting incentives in play to attract foreign investment. Also, it is a very fast-moving and dynamic industry, Egypt, like all countries will have to try stay ahead of the curve to ensure global competitiveness," Adam said.

The IDC highlights the quick adoption by Egyptian companies of converged solutions - making the most of mobile and social elements - as a particularly promising characteristic of the Egyptian market.

"I am excited to see that a number of Egyptian software firms are transitioning their custom solutions into cloud based applications which are highly-cost effective and user friendly. There is also a huge amount of innovation in the mobility and content space. As we all know, Egyptians are incredibly social-media savvy and there is a lot of innovation occurring within social too," Adam said.

"Going forward, I would say Egyptian companies are well positioned to embrace the conversion between cloud, mobile and social and will be able to offer highly cost-effective solutions in this space," she said.

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