A study calls for the adoption of “leaps of thought” to keep pace with the rapid development of the information technology sector worldwide

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The Egyptian Center for Economic Studies held a symposium entitled: “The value chain of the information and communication technology sector in Egypt: Overcoming the triple gap and jumping to the future,” during which a study was presented to the Center aimed at is to provide a detailed assessment of the performance of the information and communication technology sector in Egypt from four aspects; The first relates to the performance of the information and communication technology sector over time and in comparison with competing countries, the second relates to the assessment of the strategic and regulatory framework governing the sector, the third is the compatibility of the foundations of the developing best practice sectoral development strategies, and the fourth and final aspect relates to the extent to which the sector is able to respond to current trends in the world.

The information and communication technology sector is considered as a crucial sector for all countries of the world and the extent of its growth and development affects the country’s ability to achieve the goals of economic and social development, while there is a lack of studies which deals in detail. with the information and communication technology sector as an integrated value chain and its management method, where most of these studies are exposed. One of the links in the chain or trade on the sector as a whole, where this study focused on the sector with its manufacturing and service sides to determine the growth path that the sector is currently following in Egypt, and to what extent it is its full reach potential and its ability to respond quickly to the current technological revolution and how to overcome it.

The study reviewed a number of performance indicators for the electronics industry, software production, content, information technology services, communications and outsourcing services and concluded with a number of conclusions: Consider the electronics industry as the weakest link in the chain despite its importance, and the relative decline in value added in all ICT value chains, in addition to a gradual gradual improvement in the sector’s performance indicators, resulting in a decline. in Egypt’s position compared to competing countries, and the concentration of all activities in Cairo Greater and Alexandria, and the weak presence in the governorates, in addition to the poorly qualified human capital.

The study pointed out that among the gaps in the value-added chain also, dependence only on direct foreign investment in the provision of high-value-added and technologically advanced services, the absence of regulatory policies affecting the transfer of knowledge to local companies, and the weak interrelationships between the links of the value chain, especially between the private production share.In electronics and software, and the service aspect of telecommunications services, with the weakness of the acceptance and investment in future technologies, leading to an increase in the gap between Egypt and its competitors, which means that Egypt is following the lower path in the growth of the information and communication technology sector.

The study confirmed the existence of a set of weaknesses related to the institutional and legislative framework and the strategic framework of the sector, in particular the presence of question marks over the independence of the Telecommunications Regulatory Authority. The institutional framework also lacks a permanent mechanism to represent all parties involved in the policy-making process, the development of legislation and the absence of coordination between the Ministry of Communications and other ministries, in addition to the complications in some laws governing the sector. , the fragmentation of the legislative framework, the absence of some necessary laws and the slow activation of the laws already issued, which are the gaps that led to the delay in Egypt’s position in the sub-index of the legislative and regulatory environment in the network readiness index compared to countries The competition, where Egypt was 95th, compared to 80th in the Emirates, 60th in Saudi Arabia and 40th in the Czech Republic.

The study monitored the key strategies for the sector during the period from 1999 to 2017, which according to the study was characterized by relative weakness in the axis of maximizing the role of the information and communication technology sector in achieving economic and social development goals , while its application has led to a relative improvement in the various indicators of the sector, especially in terms of It relates to infrastructure and access, but this improvement is relatively slow compared to the period in which the application was implemented “17 year “, which led to the poor performance of the sector in Egypt compared to a number of competing countries, led by Saudi Arabia and the UAE.

As for the current strategies announced by the Ministry of Communications, one of the most prominent weaknesses is that they are very common – according to the study – and include a set of goals and general themes, a lack of a specific action plan and a time frame for implementation, and the absence or weakness of performance indicators, and there is a weakness in the role of the private sector in The development of a sector development strategy, as well as the lack of reflection of all programs aimed at to develop the sector in the axes of the strategy, of which mainly the export development program, planning for technological zones, and the absence of an actual estimate of the size of the sector are in view of the lack of clarity in the definition of the sector and its activities by all parties, as well as the absence of a base Data on companies operating in the telecommunications and information technology sector erksaam is.

The study reviewed a comparison with the Indian experience in the field of ICT sector strategy, which emphasized that the Egyptian strategy does not have the characteristics of the Indian strategy in all aspects.

Due to the previous gaps, the study indicated that the sector suffers from the inability to keep up with technological changes and global trends in this sector. Its inability to take full advantage of the opportunities offered by global trends and its weakness in dealing with challenges.

The study concluded that Egypt follows the minimum path of growth by following the gradual method in upgrading the sector, and within the framework of this gradual path there is a slowdown in the implementation of sector development strategies, which has led to a gradual improvement in the sector’s performance over a long period of time in a way that is not in line with rapid development sector worldwide.

The study recommended adopting the idea of ​​leaps to put Egypt on the map of international competition in this sector, by starting to focus primarily on placing Egypt on the global map in a specific number of value chain activities, and it states in this regard before. three basic activities: software industry, outsourcing services and a data and analysis center. .

Within this group, it is necessary to focus on high-value-added activities and products that enjoy intellectual property rights, with the need to increase the capabilities of the human factor by developing the education system, identifying the required skills and in all governorships to distribute. , and benefit from immigrant minds, with a comprehensive review of sector strategies to avoid weaknesses. program for the Egyptian government led by the Ministry of Communications and not a program for the Ministry, and its expansion to include all services (personal and business services), and the existence of a complete unified model for the digital transformation process, With a clear action plan to implement the program.

Dr. Maged Othman, CEO of the Egyptian Center for Public Opinion Research “Baseera” and former Minister of Communications and Information Technology, commented on the study and the performance of the center, which he described as professional and independent, praised and pointed out that there is a lack of studies related to the communications and information technology sector in Egypt, and calls on the Center to continue conducting more studies in this regard.

Othman pointed out the challenges facing the study of the sector in terms of the lack of data and the difficulty of its availability, as it is difficult to register technology companies and individuals and not be monitored in GDP and information dissemination in the sector’s work, calling for the need to approve incentives for technology companies to register and official work, especially as informal work is much easier.

Osman called for the creation of an “ICT satellite account” that reflects the value chain of the sector and other sectors, and called on the center to adopt the idea, and a similar experience can be had in Australia benefits because for what it needs the sector to look at itself objectively.

Othman pointed to the need to propose another alternative to the subordination of the National Telecommunications Regulatory Authority to the Minister of Communications, pointing out that there are political dimensions and dimensions related to international cooperation and national security that are not covered by the study, because it is primarily an economic study.The field of international cooperation is related to submarine cables.

Marwa Abbas, general manager of IBM Egypt, in turn said that Egypt has a clear strategy for the technology sector represented in the Digital Egypt Builders Program, and then the Digital Egypt Ashbal program for young people aged 13-18 to qualify. year, in which a number of global technology companies participate Programs to provide platforms to increase youth skills and rehabilitate human cadres, which should not be concentrated in Cairo and Alexandria and should be spread across all governorships.

Abbas indicated that outsourcing services are the fastest growing areas during the last period, reflecting companies’ strategies for growing their businesses in Egypt, an area that is experiencing good competition, and pointed out that challenges are more opportunities in the sector create.

On the key thing companies need to expand business in Egypt, Abbas said companies need infrastructure that is available at a competitive price, and clear strategies and policies for digital transformation, that attract foreign companies to invest more in Egypt to pump.

Dr. Abla Abdel Latif, Executive Director and Director of Research at the Center, said that there are plans to establish a new unit at the Egyptian Center for Economic Studies, which is responsible for the studies of the information and communication technology sector, and this study is the first of its kind, as this sector needs further study due to its challenges and great opportunities for the Egyptian economy.

On the preference of technology companies not to register, Abdel Latif pointed out that there are many reasons for companies not to register, including the tax authority’s handling of taxes on technology companies in a way that assumes everyone is bad until it proven otherwise.

On the other hand, she stressed the need for the Telecommunications Regulatory Authority not to be subordinate to the Minister of Communications, and to follow the Prime Minister, calling for co-operation between ministries in implementing strategies to the sector develop and rehabilitate the human factor, not only within the sector but in other disciplines serving the work of the sector, and to invest in it all opportunities that Egypt can make a breakthrough.

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