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    IDC: Egypt’s IT Industry to Witness Sustained Growth Rate despite World Financial Crisis

    Date published: 4 December 2008

    IDC, a global market intelligence firm, issued last September a report on Egypt’s information technology (IT) industry forecasting Egyptian IT market to grow steadily until 2012.

    The IDC report, entitled “Egypt Vertical Markets 2008–2012 Forecast,” provides a detailed overview of IT spending trends and forecasts for 17 vertical markets (or industry sectors) allover Egypt and ten product categories including hardware, packaged software and services in the country.

    The study includes an overview of key industry developments, industry challenges, vertical-specific IT drivers and trends as well as tables detailing IT spending by vertical market for each product during the period from 2007–2012.

    Analysis is based on continuous research and monitoring of users' IT spending, emerging purchasing patterns and supply-and demand-side research.

    The government, telcos, finance companies, and professional services firms are all set to increase their share of IT spending, since they have both a full range of business needs and the funding and expertise required to solve them, the report said.

    The report noted that the value of the Egyptian IT market increased by about 25% in 2007 to reach $1.58 billion, pointing out that in 2008 the market witnessed a 17% leap in this value.

    Based on the report, such development was due to the incentives the Government and the initiatives undertaken by Ministry of Communications and Information Technology and its affiliates.

    The reported indicated that the promising IT industry in Egypt is based on the country’s competitive advantages playing a key role in boosting the sector.
     
    The report further added that Egypt has been exerting intensive efforts to occupy a distinguished position on the IT services industry global map. It confirmed the Government’s readiness to invest in the human resource development required for the industry growth.

    The report said the industry infrastructure is a developed one due to the Government’s interest in the sector.  
     
    The growing list of multinationals investing in the country’s IT sector is a testament to the state’s determination to move forward in its plan to develop this vital sector, the report noted.

    The report referred to the diverse initiatives and programs carried out jointly with international partners to raise the Egyptian competence, especially with regards to training and preparation. These programs and initiatives aim at creating a new generation of qualified calibers to work in the field.

    The report directly referred to different MoUs signed between MCIT and its affiliate Information Technology Industry Development Agency (ITIDA) on one hand and their counterparts and international companies on the other. 

    The IDC study cited the Indian Wipro Technologies and Satyam Computer Services Ltd as a proof of productive Egyptian-Indian partnerships. The two companies decided to invest in Egypt’s IT sector through establishing customer support centers for their clients in Europe and the Middle East.

    The research indicated that the average growth rate of the IT sector in Egypt is forecasted to reach growth rates about 11.1% between 2008-2012, despite the world economic crisis. 

    The report anticipated an increase in the personal computers’ sales rate, describing it as one the sector’s driving forces.

    The report also stressed on the fact that the IT services industry will witness an outstanding growth during the period 2008-2012, especially that the business process outsourcing (BPO) services will open new horizons for Egyptian companies working in the field.

    The report stated that the success in the BPO services will positively influence IT expenditure. It also predicted a growth in the consultancy services as well as those offering a high added value.


    About IDC
    IDC is a global provider of market intelligence, advisory services, and events for the information technology, telecommunications and consumer technology markets. IDC helps IT professionals, business executives, and investment community make fact-based decisions on business strategy.


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