Saturday, January 15, 2011

Egypt’s new frontier - ArabianBusiness.com

Egypt’s new frontier - ArabianBusiness.com

Wael Fakharany, Google’s North Africa head, is sitting in a fake pyramid in the middle of a man-made lake in a business park somewhere near Giza.

We’re down the road from those other pyramids — the famous ones — which represent Egypt’s tradition. This new triangle — in a sprawling, glass-walled area they call Smart Village, home to internet companies and the Ministry of Communications and Information — represents its latest effort to modernise.
For a country which boasts seven millenniums’ worth of history, its experience as a global technology player is small — just twelve years, since then-communications minister (and current prime minister) Ahmed Nazif looked at the success India and China were having as outsourcing centres and thought, hey, we can do that.
Down the road from the holy site where his ancestors laid the building blocks for centuries of frenzied tourism, he laid the foundation for a technology infrastructure which could not only rival but surpass other emerging markets in one key area — innovation.


Egypt has painstakingly laid the groundwork by luring foreign companies like Intel and Microsoft as an outsourcing centre. It’s up to $1.1bn in outsource revenue, with plans to hit $3bn by 2015.
In terms of sheer size, India and China and even Brazil will probably always beat Egypt in the race to be an outsourcing hub — sales, marketing, and, yes, call centres. They’ve got the manpower and physical space Egypt never will.

But where the country can surge ahead is as a hub for the almost untapped North African and Middle East markets. There are ten million internet users in North Africa, excluding Egypt’s 21 million.
Its push begins now.

Which is why Fakharany and I are here, in this pyramid cafe that looks like a revolving airport restaurant.
“We came as an investment — there was very little in revenue but we followed the user,” he says.
Fewer than eight million people were online in Egypt when he arrived. That was in 2007.

Building blocks

Google, which set up its North Africa headquarters in Cairo in 2007, is arguably the biggest coup wrought by ITIDA, the Information Technology Industry Development Agency. It’s the government office which serves as Egypt’s technology rep to the world and its point-of-contact for foreign investment.

Other companies who have set up shop in Cairo since 2000 include Intel, Microsoft and Cisco. Before the presence had been limited to IBM, ICL and Fujitsu, which had its ancient operation in place since the 1960s.
“We are doing the outreach — focusing on positioning and rebranding Egypt as a destination for tech giants,” says ITIDA’s CEO, Yasser El Kady.

The fact that the tech sector is the brainchild and pet project of the current PM means ITIDA and the government are committed to helping private companies succeed more than they might be in other countries, with an emphasis on public-private collaboration.

“Government encouragement is key in driving our strategy here,” Fakharany tells me. “They’re faster than the private sector. They’re very open and tech-pro, for sure.”

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