When you think of Egypt, a thriving IT industry is not the first thing that comes to mind. You think about the great pyramids of Giza and a wide desert with Bedouin tents and camels. It is true that most territory of Egypt is covered with desert (95%), still around 100 million Egyptians make the most of the remaining 5%.[1] Egypt, as a developing country, has heavily invested in its technology and information infrastructure since 1985 to become the platform for the economy’s development and growth. In this article you will learn about Egypt’s IT outsourcing Industry and why you should outsource in Egypt with Evolvice.
Big cities like Cairo and Alexandria accumulated Smart cities and areas that become working hubs for international tech companies. The Ministry is also working on developing six technology parks in the cities of Minya, Menoufiya, Mansoura, Sohag, Qena and Aswan. These parks are aimed at supporting entrepreneurship and innovation and will consist of hardware design labs, startup incubators and training institutions and integrated systems for AI training, data science, and cybersecurity.[2] By now many major tech companies have moved their headquarters to Egypt or at least operate outsourcing destinations there. The IT Industry has become the working force of the Egyptian economy and is still constantly growing. IT exports are expected to rise up to 4,5 Million US$ until 2021.[3]
Evolving into one of the fastest growing offshore destinations
Within the last two decades the country has built up its IT industry and IT economy, it has taken steady steps to establish itself as a service provider partner for the US and EMEA markets. According to the Information Technology Industry Development Agency (ITIDA) Egypt’s global BPO market share is at almost 17% and it is now considered one of the fastest-growing offshore destinations in the world. The country has evolved into a high-quality service hub.[4] Egyptian IT sector is very robust with a growth rate higher than Egypt’s level of GDP growth, it contributes 4% to country’s GDP.
Low wages and many options
One of the reasons of this IT success and why so many companies outsource to Egypt are the low costs, especially the low labor costs, which are lower than in most outsourcing countries. For an outsourcing company, the average cost for a software developer ranges between $2.000 and $4.500 saving an outsourcing company up to 60% in labor costs compared to other destinations.
Nevertheless, the salaries in IT-related jobs are relatively higher than in other jobs in Egypt. Which is why many young people consider a degree in technology, science or engineering. Each year up to 50.000 students graduate in IT-related fields.[5] Most of those graduates speak English, French or German. The multilingual talent pool is serving over 20 languages across more than 100 countries. The government also invests in the development of a new generation of IT professionals by launching programs such as the Next Technology Leaders (NTL), Technology Learning Initiative and other programs it started with major Tech companies like Microsoft or Cisco.[6] Another example is the initiative “Our Future is Digital” from the Ministry of Communication and Information Technology (MCIT) that aims at training 100,000 young Egyptians and develop their IT skills in areas of high market demand, including website design, data analysis, and digital marketing.[7]
Strong workforce and low taxes
Another reason for Egypt’s IT success is its workforce of around 240.000 IT specialists who provide outsourcing services to about 100 countries all around the world. It is also due to an increasing government support that the IT Industry has grown this much. Especially in Egypt the government has built several business parks like Smart villages, where the focus is on simplifying the working process for companies, by providing infrastructure and technical requirements.[8] This way it’s easier for companies to establish outsourcing locations. In addition to that Egypt offers corporate tax releases for companies. [9]
Not only low costs and a constantly growing talent pool speak for outsourcing in Egypt, but also the geographic proximity and small time zone difference. Egypt is only 2 hours apart from most European countries, so the work process won’t be delayed by time difference and it provides business continuity with US and Asia.
Start your outsourcing process with us now
If you’re interested in outsourcing to Egypt, Evolvice can become your perfect partner. As a service provider, we are active in Cairo since 2018, by developing custom software solutions that are tailored to our customers´ needs. Since 2019 we have been offering outstaffing services by providing IT specialists and tech talents who work remotely for our clients (distributed and remote teams). We’ve also successfully established and run Ukrainian development centers and IT hubs Kiev and Uzhhorod. Read our Blog article about the Ukrainian IT Industry if you want to find out more.
Contact us now if you would like to find out more about Egypt and outsourcing opportunities. Many of our customers have been working with us for years. We would be happy to tell you more!
—
[1] https://www.lwf.bayern.de/wissenstransfer/forstliche-informationsarbeit/016491/index.php
[5] https://outsourcing-verband.org/wp-content/uploads/2020/01/Egypt_2019_Guide_WEB_FINAL_Aug28_3.pdf
[6] https://outsourcing-verband.org/wp-content/uploads/2020/01/Egypt_2019_Guide_WEB_FINAL_Aug28_3.pdf