Download - Zenith

MONEy AND POwER
Pharaoh‘s
legacy
Mubarak promoted the
very IT sector that
ultimately proved his
undoing. The Smart
Village in Gizeh was all
part of the master plan:
plenty of IT specialists, a
good location and low
wage costs. Only now are
we about to find out if it
really works by Simona Pfister
The Intifada on the Nile would have
struggled to cope without internet
platforms to rally support. And the
fact that the country – particularly in the
Northern cities – now has a relatively high
level of connectivity is something for
which the old government only has itself
to blame. While it paid next to no attention
to the needs of the poor, it spent all
the more time focusing on the local branch
of the information and telecommunications
industry (ICT). One thing is clear
12 BusinessReport 1/2011
about the »Smart Village«, the first fully
equipped technology park in Egypt, that
both international and local firms have
found it to be a prime location.
Just a few metres past the turn-off to the
pyramids of Gizeh is the entranceway to the
business park. The dirty concrete deserts
and din of Cairo, along with the demonstrations
and political uncertainties, are soon
forgotten here. You feel as though you are in
a high-tech biotope reminiscent more of
Dubai or Abu Dhabi than Egypt. While the
Smart Village Company – the operator of
the park – put up extra security guards during
the weeks of protest, on the surface at
least, it looked as though the company was
not overly concerned by it.
In the past few years, Egypt has managed
to post steady economic growth – despite
the world financial crisis – of 5.9 per cent in
the first half of 2010. One dynamic branch of
industry is the ICT and outsourcing sector,
which has set up camp in the Smart Village.
According to the government’s own figures,
the sector grew over the past year by 12 percent
and the number of ICT firms rose by an
impressive 16 percent. Today the sector only
contributes a comparatively modest 4 percent
to gross domestic product – putting it
well behind leading nations like India. The
Mubarak government had planned to expand
its share of the economy on a grand
scale; but it is not yet clear how things will
pan out. The aim was for the annual profit of
the industry to climb from USD 1.1 billion to
USD 10 billion by 2020, as Tarek Kamel, who
was Minister of Information Technology
and Telecommunications at the time, announced
in the spring of 2010.
International observers have also become
more aware of Egypt since it won the coveted
European award of »Offshoring Destination
of the Year« in July last year. Cairo was
ranked seventh in 2008 on the list of outsourcing
cities compiled by consultancy
firm Tholons. In July 2010 the London School
of Economics found Egypt to be the most
promising offshore candidate after Brazil,
China, Russia and India.
When you look around the Smart Village,
it soon becomes apparent that international
companies have become convinced of this
too. »After Microsoft acquired a business
premises in a prominent position, the other
companies wanted to follow suit«, explains
the PR spokeswomen for the Smart Village.
pictures: dge