Mobile phone production leads the localization of electronics manufacturing in Egypt

Writing: Wael Al-Toukhi

Dr. Amr Talaat, Minister of Communications and Information Technology, confirmed that the tendency to localize the mobile phone industry represents one of the areas of electronic manufacturing sought by the Ministry of Communications and Information Technology 2030 strategy to accelerate and accelerate the process of digital transformation reach. a comprehensive and sustainable development process, as the Ministry seeks to localize technological industry operations, microtechnologies and small electronic circuits. By helping investors to inaugurate various factories and providing the necessary incentives for them, in addition to preparing human cadres on the latest training programs and to qualify them with the required skills as long as investment in human mind is the best type of investment ever.

He explained that the support and strengthening of electronic manufacturing operations helps implement a number of other axes for the telecommunications and information technology sector, the most important of which is the increase in technological exports, as the value of digital exports reached $4.9 billion during the fiscal year 2021 /2022. Egypt’s Digital Strategy Targets; Double Egypt’s digital export revenue by 2026.

The strategy aims to attract promising investments to the Egyptian industrial market in the sector and to develop the local product of the highest quality and qualify it for the world to be in an advanced position to compete with its foreign and regional counterpart to compete, which was confirmed by Dr. Amr Talaat, Minister of Communications, that the ministry places the process of manufacturing devices and electronic products on its list of priorities, of which the mobile phone industry is the most important.

4 international companies benefit from the benefits of industrial investment during 2022

These efforts are represented in various works, including the cooperation concluded by the Chinese company Infinix for mobile phones in Egypt with SICO Mobile to rely on the second factory and install lines for the production of Infinix mobile devices in the technological zone in Assiut, as it steps towards turning Egypt into a production center for the company in the Middle East and Africa region With the growth of its sales, considers Egypt as a promising market in the region.

A cooperation agreement was also signed between HMD International, the owner of the global brand Nokia, and Egypt’s Etisal Advanced Industries, which was witnessed by the Minister of Communications with the aim of producing one million mobile devices of various models between traditional feature phones and smartphones, during the year The current production will double in the coming period.

HMD supplies Etisalat Factory for Advanced Industries EAI production requirements of raw materials, inspection and testing tools and calibration equipment necessary for the production process and development of the company.

It is worth noting that EAI, through its factory located in October 6, develops and manufactures advanced electronics in Egypt, with a production capacity of more than two million units this year, and reaching ten million units annually in the coming years.

The Minister of Communications also met with the Vice-President of Sales and External Services and Head of the Mobile Business Center at Oppo, which specializes in the production of smartphones, during the Smartphone World Congress in Barcelona early this year, with the aim of discussing the pumping of new investments in the field of electronic manufacturing and the establishment of a mobile phone factory.

electronic manufacturing

Vivo Smartphone Company has also established a new factory in the Tenth of Ramadan City in Sharkia Governorate, which is established on an area of ​​11,000 square meters, with investments estimated at $20 million, which within a year will be $30 million amount. The factory also contributes to the provision of 1,500 jobs within a year. The latest international technologies in production lines and devices for surface installation, assembly, calibration and testing.

During his visit to the factory, the Minister of Communications was informed about the company’s investment plan and future expansions in Egypt, export plans, the start of trial operations and checking its readiness, and making sure that production begins with the highest international technical specifications. , and it is scheduled that the proportion of the local component in production will reach 45%.

The shift to phone manufacturing is contributing to an increase in digital exports

Minister of Communication, Dr. Amr Talaat emphasized the government’s eagerness to encourage and stimulate the private sector to manufacture within Egyptian factories to transfer knowledge and expertise and localize the electronics industry, noting that Egypt is taking rapid steps to localize manufacturing deepened in the implementation of the presidential initiative “Egypt makes Electronics”, which aims to improve Egypt’s position in the field of electronics Electronic design and manufacturing.

The minister said that the ministry’s strategy for the production of mobile phones depends on two main axes, adding that the first axis aims to increase the percentage of the local component used in its manufacture.

The minister revealed that the second axis is based on the training of the human element on the latest manufacturing skills and their qualification in accordance with international training programs related to the microelectronics industry, and explained that support for training operations through artificial intelligence- technology and machine systems will be taken. in consideration

10% expected drop in prices of devices during the first production phase

Ihab Saeed, Chairman of the Board of Directors of the General Division of Communications, Electronic Payments and Financial Services at the General Federation of Chambers of Commerce, emphasized the need to invite international companies to be present in Egypt and local manufacturing and localization of industry, especially with the launch of the presidential initiative “Egypt manufactures electronics.”

The head of the department added that the unprecedented investment incentives and tax and customs exemptions on production components and raw materials have pushed the two largest international companies “Nokia – and Vivo” to manufacture in Egypt, which will lead to direct employment opportunities for the educated Egyptian. labor qualified by the Ministry of Communications.

Saeed added that the localization of the electronics industry and its supplies is one of the priorities of the state plan represented by the Ministry of Communications, noting that the production of approximately 1.5 million mobile phones annually in Egypt will result to the reduction of shipping costs and the reduction of imports from abroad for these strategic products for citizens, in addition to preserving the dollar, and not depleting it in the import process. .

He explained that during the last period, the mobile phone market experienced great confusion as the import bill dropped due to shipping and transportation conditions with the repercussions of the Corona pandemic, followed by the global economic crisis and the crisis of lack of production of electronic chips . and the subsequent outbreak of the Russian-Ukrainian war, which affected all countries and led to the difficulty of imports and delay of shipments.

electronic manufacturing

Saeed revealed the change in the thinking and policy of international companies regarding industrialization in Egypt and their view as a platform for exporting to Africa as a safe gateway, where there are approximately 1.5 billion consumers on the black continent.

Legislation and the local component are the main challenges of the electronics industry

Engineer Ahmed Salem, head of one of the companies specialized in the electronics industry, explained that the legislative regulations are one of the obstacles blocking the way to establish the industry in Egypt, especially in light of the inappropriate laws and legislation entrusted with encouraging foreign and local investors to pump their money into projects, in addition to not motivating them by providing facilities and providing support. It is necessary, note that without the success of the legal legislation , Egypt loses more than 60% of its investment projects due to the investors’ belief that the state does not support them, and therefore they see that the market is not suitable for them.

In his statements to Ahl Masr, Salem added that the fourth challenge revolves around the efficiency of the information technology infrastructure to pave the way for small manufacturers of developers and entrepreneurs in Egypt to achieve a technical boom in the telecommunications sector, referring to the American experience that constantly seeks to control the field of advanced technical industries. A company in the United States does not need more than 24 hours to pass until the procedures are completed, the opposite of what happens in Egypt. Therefore, America is working to capture the global market for the software industry in a large percentage, which calls for an acceleration of reliance on technological learning and investment in the human element to make the Egyptian experience successful.

Mohamed Azzam, an information technology expert, said the other challenge to technological industrialization in Egypt is the decline in the efficiency of the human element and the weakness of its capabilities.

At the same time, he explained the lack of investment in education in the human element, which caused its negative effect on the delay in the establishment of the technological industry in Egypt, as production decreased, exports decreased and competitiveness weakened in light of of reliance on aggregate. industries based on importing their raw materials from abroad.

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