Ministry of Communications and Information Technology
23 March 2023
Egypt Emerges as Regional Electronics Hub

Egypt Makes Electronics (EME) initiative aims at transforming Egypt into a regional and global hub for advanced electronic design and manufacturing in Arab, African, and European markets, before the end of 2030.

The initiative aims to position the electronics industry as a key driver of economic growth in Egypt. It is schemed as a main contributor to doubling exports, reducing imports of electronics, and providing jobs for researchers, engineers, and skilled technicians.  

With that in mind, the Egyptian government developed a far-reaching vision to bolster the ICT industry. The vision involves building capacity, qualifying young people for the ICT job marketplace, attracting foreign direct investment (FDI), launching innovation programs, advancing electronic design and manufacturing, and promoting digital transformation.

Owing to its unique features, Egypt is poised to become home to a thriving electronics industry. The country has a strategic location that helps transform it into an export hub; skilled labor, and a huge consumer market. In addition, the government offers tax incentive schemes and duty exemptions on certain tools and equipment to investors in industrial and free zones.

To ensure a successful implementation of EME, the Ministry of Communications and Information Technology (MCIT) has adopted a digital upskilling strategy to make available the needed IT and manufacturing workforce. A Creativa Innovation Hub has been established at the Knowledge City in the New Administrative Capital to provide an enabling environment for the integrated circuit (IC) design and electronic system industry and its development. The Hub houses advanced labs, a training academy, and a technology incubator for IC design-specialized startups.

The three-phase initiative is undertaken by the Information Technology Industry Development Agency (ITIDA) through a team of experts in management and electronics technologies. ITIDA also collaborates with strategic partners, including ministries, state agencies, universities, and research and training centers to support this flagship initiative.

EME focuses on two main scopes. First is the superior design and production of electronic circuits and systems with high added-value and backed with a high level of tech support. Second is creating a labor-intensive electronics manufacturing industry.

The initiative is carried out based on several pillars: attracting investors to manufacture promising electronics characterized by high and fast payoffs, empowering R&D and innovation in electronics, fostering industry-academia collaboration, encouraging exports, maximizing the utilization of Egypt's trade agreements, investing in people to fulfill the industry needs, and branding Egypt as a leading regional hub for innovative electronic designs.

Moreover, ITIDA has been creating a favorable environment, with a smart infrastructure, cutting-edge digital manufacturing centers, advanced testing labs for microelectronics, and Industry 4.0 Innovation Center (IIC). This is in addition to specialized labs in IoT, robotics, and multimedia, a training academy, along with professional business services and well-equipped office spaces, all to support and empower tech companies.

The most promising items for local manufacturing and export include smart phones, tablets, GPS devices, complementary products such as lithium batteries and chargers; lighting products, TVs, LED displays, smart meters, solar systems such as solar cells, power adapters, control chips, and battery energy storage systems (BESS).

Within EME, nine subprograms are implemented, including for investing in technology parks by building specialized complexes for electronics design and fabrication, promoting investment partnerships in capital with tech companies, deepening local manufacturing, and attracting capital in technology parks and smart villages. This is in addition to attracting international manufacturers with their supply chains, helping transform Egypt into a regional industrial base, and implementing R&D and innovation support programs.
Other programs are carried out for developing design companies in technology parks and smart villages by supporting the establishment of prototype fabrication facilities, financing startups, and implementing electronic design programs and a product testing and adoption program, which involves establishing MENA first laboratory for testing and adopting communication devices and electronics, in collaboration with a specialized international lab.

For developing human capital, in-depth training programs are implemented, targeting senior officers, engineers and technicians to meet the industry needs. In addition, customized programs are provided for companies’ employees (in design or manufacturing), in Egypt and overseas, to transfer advanced technology based on the requirements of each facility. This is in addition to activities for cementing Egypt’s position as a hub for innovative design, and for a developing enabling legislative frameworks and creating a favorable environment for that industry.

ITIDA has been an ardent supporter to R&D. In 2022, the Agency funded seven research projects in advanced electronics for mass production. This is in addition to the registration of five international patents and publication of 12 research papers produced by electronics specialists in collaboration with national and international companies operating in Egypt, all to further enhance the R&D and technological innovation landscape in Egypt.

Moreover, the Electronics Research Institute (ERI) in Egypt is the biggest national research center in electronics engineering. ERI team has nearly 300 researchers specialized in different fields of electronics. It also boasts high-tech labs equipped with state-of-the-art measuring tools, as well as central labs, including the Nanotechnology Specialized Laboratory and the Cloud and High-performance Computing lab.

ERI also houses Egypt’s first electronics-dedicated business incubator, Tarieic. It targets innovators and entrepreneurs specializing in electronics, with a focus on research areas of strategic goals and objectives, such as renewable energy, smart sensors, IT applications, and alternatives to imported products.

MCIT has provided several facilitations, programs and initiatives, with a goal set to make Egypt the ultimate destination for electronics manufacturers.

The country has successfully attracted several manufacturers, now operating in Egypt, catering to both the local and regional markets. In 2022, three major companies: Vivo, Nokia, and Samsung, invested EGP 2 billion to make smartphones and tablets at a 20 million device production capacity.

Furthermore, an agreement with OPPO was concluded to establish a smartphone plant in Egypt, joining another 10 OPPO manufacturing plants worldwide. With an annual production capacity of 4.5 million devices and investments of about US$ 20 million, Egypt’s plant will serve as OPPO’s regional hub for manufacturing and exporting to Arab and African markets.

Along the same vein, two fiber optic cable factories started operation at a production capacity of about 8,000 km, with foreign and local investments. The two factories feed local and regional markets and they started exporting to Europe during the fourth quarter of 2022.

All those efforts helped increase the number of electronics companies 22% and attract new international manufacturers to the market. Ten new companies specializing in IC design and embedded systems started operating, and existing electronics design companies have been expanding. As a result, the number of job opportunities grew 18%, and the size of international and national electronics companies in Egypt reached 57. This in addition to agreeing with 26 national and international companies specializing in electronics design and embedded software to operate in the Electronics Innovation Center at the Knowledge City in the New Administrative Capital.

In a recent milestone, Egypt was selected to have the Global Semiconductor Alliance (GSA) first external division, GSA Egypt. This capped the efforts made to enhance collaboration to grow the semiconductor industry and create a favorable business environment. More than 20 specialized companies have joined GSA Egypt.

Egypt has taken bold steps toward deepening local manufacturing through EME, with the goal of developing a thriving electronics industry, attracting foreign investors, establishing partnerships to create job opportunities for young people, and realizing the national vision of leading a strong local manufacturing scene.
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