Although Egyptian IT companies are late directing their investments to the African market, a number of the sector’s officials confirmed there are many promising growth chances in the continent’s markets.
Officials agreed the African market is in need of technological solutions, especially for governmental services in the fields of health, education, industry, and agriculture.
Chairman of IT Industry Chamber (ITC) Khaled Ibrahim said investment opportunities in the African market are promising since most African countries suffer a lack of IT services especially in health, education, industry, and agriculture sectors. This situation gives Egyptian companies the chance to invest in these markets.
Ibrahim believes English-speaking African countries should be the focus of promoting Egyptian companies’ services. Ibrahim said the difficulty of transferring money in some African countries and transportation in others are two of the most prominent challenges Egyptian companies face for expansion within Africa.
Many countries expanded into Africa before Egypt, most prominently Lebanon, Jordan and China, said Ibrahim. Nevertheless, he finds the African market still has investment opportunities, which enables Egyptian companies to expand there.
Ibrahim revealed the Information Technology Industry Development Agency (ITIDA) agreed with ITC on promoting Egyptian companies in Middle East and North Africa countries, of which ITC already started through its “Bridges” trip to Morocco.
Another visit is scheduled to the Saudi market in March, Ibrahim said; Algeria is planning to visit too. The deal also included promoting services of Egyptian companies in southern African countries by ITIDA. As for competitive advantages of Egyptian companies, Ibrahim said they have an edge on the companies operating in these markets in terms of services and prices.
Vice Chairman of ITC Hossam El Sammad said expanding in African markets is the normal orientation of Egyptian companies in the upcoming period, given the advancement of solutions they provide compared to other companies operating in these markets.
African markets have growth potentially more than the Gulf area, although the purchasing power indicators are in the Gulf countries’ favour. Education and health are two of the most prominent sectors with investment chances for Egyptian IT companies in Africa, El Sammad said.
The “Bridges” trip that ITC organised is an example of the potential Egyptian companies have in Africa. Seven of eighteen companies that travelled with ITC’s trip were able to sign contracts with Moroccan companies to provide their technological services and solutions. The rest of the companies commenced discussions with their Moroccan counterparts to open ports of cooperation between both parties, which shows there are unused investment chances in Africa, El Sammad said. Deals were conducted with hotels in Morocco to provide accommodation to ITC member companies at a discounted rate to make it easier for them to communicate with their Moroccan counterparts.
ITC is studying how to best establish contracts with marketing companies to promote local companies in African markets, as an attempt to increase these companies’ chances of expansion in the region. ITC officials will meet COMESA officials during the conference in Sharm El-Sheikh to discuss ways of cooperation in the field of IT, El Sammad said.
CEO of Sico Technology Mohamed Salem said a number of countries expanded their investments in the African market before Egypt such as China, Lebanon, Israel, and India but that Africa still has a place for Egyptian companies.
Competition in African markets would be easier for Egyptian companies than expanding in the Gulf area especially since huge international companies are already operating in Gulf markets, Salem said. He called on them to take the issue seriously and develop clear plans to facilitate the expansion of Egyptian IT companies.
Revenues can be made faster in Africa than in the Gulf area and IT sectors, especially governmental services in Africa, have promising investment opportunities.
