In order to assess Egypt’s position in innovation relative to other countries about its readiness to innovation, it is essential to analyze both the national and firm levels.
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Network Readiness Index (NRI)
As it is composed of both quantitative and qualitative sub-components, the NRI provides a unique way of observing how a particular country performs over time with respect to building a competitive information society. It also allows benchmarking national performance vis-à-vis competitors or similar economies.
National Economies often chart a path from being “factor driven” to being “efficiency driven” to finally being “innovation driven” where economies are able to sustain higher wages and support high standards of living based on a national culture of generating endogenous innovation.
In the case of Egypt, a significant number of NRI strengths are ICT-related variables, like government prioritization of ICT. On the other hand, some other strengths are non-ICT specific, yet of direct relevance to innovation. These include venture capital availability, state of cluster development and firm-level technology absorption.
Regarding Egypt’s weaknesses, an area in which Egypt has massive challenges to face is education. Such challenge represents a striking impediment in a country of high population such Egypt causing a lot of harm to its economic and social potential.
When comparing the overall NRI performance of Egypt to that of various income groups, it is easily observed that Egypt does better than most of the ‘low-middle income’ countries, where it was ranked as the 8th out of31 countries in this group. In addition, Egypt was the only African country that progressed by more than 6 ranks.
Egypt’s NRI performance (70th) is comparable to that of countries with higher income levels such as Turkey (69th), Indonesia (67th) or even Poland (65th) and Brazil (61st). It is also significantly better than that of Russia (80th). |
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The Global Innovation Index (GII), featured in the strategy, examines how countries benefit from innovation through the use of enablers that stimulate innovation. GII relies on five enabling parameters (input pillars), namely: institutions, human capacity, general and ICT infrastructure, market sophistication and business sophistication. The two output pillars of GII — scientific outputs and creative outputs and wellbeing — aim at assessing the impact of innovation within the economy.
A closer look at Egypt’s performance
The latest GII rankings show that it is not necessary to be a large economy to be an innovating one. Iceland topped this year’s GII ranking despite the difficult economic situation it has faced over the last two years.
In the 2009 GII report, Egypt ranks 74th out of the 132 countries covered. On the innovation input index, Egypt’s rank was 84th. On the innovation output index Egypt’s rank was 68th.
Comparing Egypt with Middle East countries, Egypt’s GII profile ranks better on the output pillars compared to input pillars. In particular, human capacity is an area in which Egypt possesses a strong base, but also needs to capitalize on and grow in a more dynamic fashion.
Regarding the “creative output” pillar, Egypt’s performance is relatively better. The “market sophistication” pillar is one in which Egypt is able to make progress that would enable Egypt to emerge as a regional lead, which may be the key to its success in attracting foreign investment and branding itself as an innovation hub.
On the other hand, Egypt’s relative performance on the institutions and creative outputs pillar remains relatively strong when compared to Asian countries such as China, India, Malaysia and the Philippines.
Areas that Egypt must target to strengthen its innovation input and output indices are its “business sophistication” and “scientific outputs” pillars. |
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Innovation Readiness Model
The Innovation Readiness Model (IRM) is a way to rank the ability of organizations to innovate successfully.
A survey was conducted concerning the innovation elements by a sample of Egyptian ICT firms.
The survey indicates companies’ confidence in the potential of the employees to explore and discover, although they are very hard to find. It also indicates that there are few data on innovation to be found in Egypt. According to the survey, innovation is still not considered as an essential trend to create nez business models.
Two-thirds of Egyptian ICT firms surveyed have some form of innovation department, which is relatively high. Having an organizational set-up that acknowledges the importance of innovation is a good start.
As for new ideas generated, three-quarters of ideas come from departmental teams, showing that Egyptian firms are relatively more collaborative with their partners (suppliers, clients and third parties) than other firms. |
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