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French Version

Egypt's massive potential

Amidst efforts to develop Jordan's software industry, it is worth taking a look at neighboring countries and their plans to achieve similar, if sometimes more ambitious, goals.

Amidst efforts to develop Jordan's software industry, it is worth taking a look at neighboring countries and their plans to achieve similar, if sometimes more ambitious, goals. This week, a five-year plan was announced in Cairo "to Lift Egypt's Software Exports to $2 Billion." It was an impressive announcement, not only because the Egyptians set a specific target and stated it in figures, but because of the detailed long-term plan it laid out.
The current size of the software industry in Egypt is a staggering $50 million, which should be quadrupled within five years to $2 billion. Studies show that there is tremendous potential for the Egyptian software industry, especially in the domains of localization, customization and consulting. These fields also hold great potential in Jordan. Yet, the Egyptians point out their weakness, which is admirable, singling out high taxation as an obstacle to promoting a competitive software industry and a deterrent to investments in software research and development.

Still, looking at Egypt as a whole, we've got to bet on their chances of becoming the next India or China in software development, simply because of the country's population, amount of investment and talents available.

These are all characteristics that Egypt has in common with the very successful, and continuously developing, software development centers of today, especially India which is truly a success story. Although some people may be betting on countries like the UAE, or even Jordan, as being development centers in the region, Egypt has got the potential to be the front runner. Egypt benefits from a large pool of human talent that comprises a considerable number of software experts, all qualified to localize international modules.

The only problems, so far, with Egyptian efforts is its difficulty in organizing and mobilizing such a vast market, and setting its course in a common direction; something we've succeeded in doing here in Jordan for the last couple of years, probably due to the smaller scale and number of development companies involved. It is estimated that there are 160 software development houses in Egypt, employing around 10,000 developers. However, high taxation on imports has made it hard for Egyptian companies to offer competitive packages. The study advised that high taxation on IT imports is one of the major obstacles facing the Egyptian software industry, and called for a cut in import taxes from the current 25% to 3% in order to make the industry more profitable. The Union's study also called on the Egyptian government to include the software industry as a main item in trade pacts signed between Egypt and the rest of the world.

The Egyptians have managed to shift their attentions in the right direction, following a focus during the early nineties on ready-made Arabic packages. Naturally, Microsoft stamped out everyone else's efforts with its massive marketing abilities and established its office applications as the standard in Arabic computing.

Accordingly, Egyptian software companies started working on Arabizing and localizing software for big publishers, or handling development contracts for any software companies that needed additional 'man and brain' power, especially during the boom that accompanied the crazy Internet economy for a few years.

Now, with things slowing down somewhat in global IT, it seems like the right time to lay the foundation for a long-term, well-prepared action plan. What the Egyptians can also do is take a look at the model of public-private sector cooperation we have managed to create here in Jordan, through the REACH initiative and through the continued work of industry bodies like Int@j. The efforts exerted in Jordan are also beginning to bear fruit. In Egypt, based on the ratio of their population and capabilities compared to ours, the success of similar efforts could mean success that is ten-fold. Hopefully, they will achieve that and much more.

Zeid Nasser
The Star

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