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Ministry of Communications and Information Technology

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Presentation on theme: "Ministry of Communications and Information Technology"— Presentation transcript:

1 Ministry of Communications and Information Technology
ICT Sector in Egypt: A Model For Reform Amr HASHEM Ministry of Communications and Information Technology Arab Republic of Egypt

2 Agenda Outlook of Egypt ICT Reform Process Way Forward Timeline
Major Policies Success Stories Way Forward

3 Egypt Potential Geography Resources
Cross Connection between Europe, Africa and the Middle East. Resources $80 billion invested in modernization of infrastructure in 21 years 72 Million inhabitants with 50% under the age of 20 Ranking 17th worldwide in no. of yearly graduates 71 million with 2% annual growth rate GDP per Capita of almost $ 1000 (PPP $ 4500) with almost 5% growth rate Almost 17 million in school 2.1 million in higher education

4 Reform Process Empowerment of the Democratic Process
Multi-Candidate Presidential Elections Parliamentary Elections under full supervision of the judiciary Transition into a Market Economy Building the institutional and regulatory framework Multitude of opportunities for private investment Stable Egyptian pound since December 2004 Strong increase in customer spending and confidence since new Cabinet Appointment in July 2004 Reduction of personal and corporate tax rates to become second lowest in the region Increase in FDI and significant acceleration in privatization process

5 ICT Reform Process 1999 2002 2004 2005 1998 2001 2003 Jun. 1999:
Launch of Attempt to Privatize Telecom Egypt Oct : Establishment of Ministry of Comm. & IT 2002 Sept, 2002: Failure of negotiations for establishment of revenue-sharing scheme for WLL Jan. 2002: Launch of a Subscription-Free Internet service Jun. 2002: Commitments to WTO concerning Basic Telecom. Apr. 2004: Ratification of E-Signature Law and establishment of ITIDA May 2004: Launch of Broadband Initiative 2004 Nov 2004: Telecom Egypt receives investment grade rating 2005 Feb. 2005: Launch of Universal Service Fund Apr. 2005: Initiating Privatization Attempt for Telecom Egypt Dec 2005 De-regulation of telecom. market 2000 Jun. 2000: Adoption of the Telecom. Master Plan Jan. 2000 Announcement of National CIT Plan Oct. 2000: Postponement of Privatization of Telecom Egypt 1998 Apr. 1998: Separation between telecom Regulation and Operation May. 1998: Privatization of mobile sector 2001 Jan. 2001: Launching of a number of PPP projects Jun. 2001 Public Consultation on draft Telecom Act Jan. 2003 Ratification of Telecom Law 13/2003 Apr.2003: Joining WTO- Information Tech. Agreement. 2003 Need some colors on the plan 1998: Separation of Operation and Regulation. Establishment of an Independent Regulatory Authority 1998: Privatization of mobile sector 1999: Establishment of Ministry of Communications & Information Technology. Development of 1st National CIT-Plan. 2000: Development of Telecommunications Master Plan 2001: Licensing of Network Service Providers 2002: Launch of a Subscription-Free Internet service 2002: Commitments to WTO Basic Telecom agreement 2003: Ratification of Telecom Law 10/2003 2003: Joining WTO- Information Technology Agreement. 2004: Ratification of E-Signature Law and establishment of ITIDA 2004: Launch of Broadband Initiative 2005: Launch of Universal Service Fund 2005: Privatization of Telecom Egypt Dec 2005: Full De-regulation of Telecom market

6 Commitment of Political Leadership to support ICT development
Policy Principles Involvement of partnerships throughout the process Empowerment of the role of the civil society Free flow of information to all stakeholders Good Governance Decentralization of decision making Critical Role of Regulatory Institutions Commitment of Political Leadership to support ICT development

7 Information Society Initiative
Inclusion of the stakeholders in the analysis and policy development process Government Technology Providers Service Providers Formulation of a master plan for ICT sector development in a deregulated environment E-Readiness E-Learning E-Government Execution of the plan in a Public-Private Partnership approach Network operators Academia Financial institution E-Health E-Culture ICT-Exports E-Readiness : Equal access for All E-Learning : Nurturing Human Development E-Government: Government Now Delivers E-Business : A New Way of Doing Business E-Health : Increasing Health Services Availability E-Culture : Promoting Egyptian Culture ICT Export Initiative : Industry Development

8 Integration in Regional and Global Economy
Bi-lateral Trade Agreements Multilateral Trade Agreements Euro-Mediterranean Partnership Greater Arab Free Trade Agreement Common Market for East and South Africa World Trade Organization Full commitment to Reference Paper Technology-neutral approach to licensing of services Full Market Liberalization by the end of 2005 No limitations on Foreign Capital participation

9 World Trade Organization
Undertook commitments for Basic Telecom Liberalization under the BTA in June 2002: Full commitment to Reference Paper Technology-neutral approach to licensing of services Full Market Liberalization by the end of 2005 No limitations on Foreign Capital participation Reasonable and non-discriminatory terms for access and use of public telecommunications network Right to interconnect with public networks Telecommunications operators have flexibility to build or lease infrastructure Creating a competitive market and regulating dominant operators Consultative process in rule making De-regulation when free competition emerges Technology-neutral approach to licensing More than 3.5 Gbps of international capacity for 5 million dialup users and 80 thousand broadband users

10 World Trade Organization
Egypt joined the Information Technology Agreement in April 2003 Progressive Approach to Tariff reductions over 4 years Drop of tariffs by 2005 Extension for nascent industries till 2007 Accelerated the execution as part of the customs reform package in September 2004 Dropped the cost of deploying new ICT infrastructure by more than 33% Instrumental in various initiatives for PC-ownership and broadband deployment Joining the WTO- Information Technology Agreement for reduction on customs on ICT related products in April 2003 Successive annual reductions of tariffs to 0% While the commitment of Egypt was to be implemented in 2005, Egypt has chosen to facilitate the process and removing customs on IT products as a part of the tariff reform process in September 2004 Weighted Tariffs on ICT products

11 Further Liberalization under WTO
An offer for commitments on Computer Related Services for improving Egypt’s positioning as an IT hub for MENA No limitation on foreign staffing for the first 4 years of operations No restrictions on foreign ownership or national treatment Permitting cross-border supply of services whenever required Restructuring of the postal sector in Egypt inline with international best practices Licensing several companies for provision of Courier services in Egypt No limitations on National Treatment or foreign participation in courier companies

12 Professional Training
Developing highly qualified experts through Internationally certified programs Decision Support & E-Commerce System Analysis & Design Software Development Communication Networks Management & Security Call Centers Operations and Management Executed in cooperation with Multinationals in a win-win approach Quality of Human Resources Agents Wages (DataMonitor) USA Canada Mexico Egypt India Hungary Poland Agent Cost 100% 89% 60% 54% 49% 54% 61% Languages Availability Proficiency in western languages due to the strong tourism industry Major foreign universities residing: AUC, Canadian College, French University, and German University All spoken languages are accent-neutral Availability of scarce languages Geography Stability Government Incentives Over 15 Million Egyptians are currently in education university graduates and 1.06 Million high school graduates annually Over graduates each year are bilingual or multilingual Over graduates each year from technical universities Number of certified professional are almost IBM Technology Development Center : Largest software development lab owned by a multinational in the region. Employing a team of over 350 highly qualified and certified technical professionals Expected to grow to around 500 people in 2005. Eight patent applications were filed in different technology areas this year. 99% of its services are delivered to IBM labs and customers in the USA and Europe. Intel Software Enablement Lab & Platform Definition Centre Established in March 2005 Technical support for regional software vendors to help market their products Platforms designed specifically for the needs of Intel’s customers in Egypt, the Middle East and Africa Intel chose Cairo as the location due to its central location in the Middle East, its skilled workforce and strong government support for ICT Oracle Global Support Center Established in Cairo in February 2005 in the Smart Village. Provides high level technical and professional services to Oracle customers around the world. Started operations with 40 highly skilled and qualified professionals, delivering 24X7 coverage to customers in Asia, Europe and the Americas. Centers of Excellence for Transfer of Know-how Establishment of virtual R&D centers of excellence in association with multinational and local companies working in Egypt and Egyptian ex-pats Data Mining and Computer Modeling Wireless Communications Mobile and E-Services Electronic Design Graduates in Thousands

13 ICT Skills Development
Aiming towards improving ICT literacy Office Applications Internet Web Development Executed in cooperation with universities and NGOs Qualifying trainees for International Computer Driving License E-Learning Competence Center in cooperation with Cisco - a regional initiative supported by the WEF Nile University A graduate-level, research-oriented university specialized in technology and management Graduates in Thousands

14 ICT Growth Private sector is leading the growth in ICT sector
Investments of private-owned ICT Companies exceeded EGP 10 billions Number of private owned ICT companies exceeded 1500 companies employing 35,000 employees Supporting the ICT Associations’ formation: Egyptian Information Telecommunication Electronics &Software Alliance (EITESAL) Adding ICT activities to the Investment Incentives law. (Year 2001) Issuing Intellectual Property Law (Law No. 82/2002) Issuing a progressive law to govern the communications industry (Law No. 10/2003) Issuing a law for E-signature and establishing the IT Development Agency ( Law No. 15/2004) Tax Reform Law (Law No. /2005) Investments of ICT Companies in Egypt exceeded EGP 30 billion in the past 7 years Share of ICT exceeded 3.5% of GDP from about 1.5 % in 1998 (100% increase in 6 years) Increase in number of ICT companies to 1571 ( a 700% increase in 7 years) Current number of employees of private ICT companies exceeds 35,000 in addition to almost 100,000 employees in government owned ICT telecom and postal agencies

15 Smart Village A business park over 300 Acres of land:
Multinationals (Microsoft, Alcatel, Vodafone, HP and Ericsson) Call Centers Technological incubators MCIT and NTRA A financial district in Phase III ( ) A business park: Investment incentives (tax exemptions) Over 300 Acres of land (90% are green areas) hosting of up to 54 buildings ( sq.m. of office space) Hosting 25,000 – 30,000 jobs State-of-art infrastructure: Fiber connectivity to each building A high-speed network for transfer of data, audio and video managed by the private sector Customers: Multinationals (Microsoft, Alcatel, Vodafone, HP and Ericsson) Technological incubators & SME MCIT and NTRA moved in Dec as Phase II. A financial district in Phase III ( ) for the Egyptian and Arab Stock Exchanges and other financial institutions

16 Regional Leadership in Converged Services
Emergence of Egyptian Companies as regional operators Egypt is becoming a regional center for mobile network deployment and services ISC – Alcatel RNSC- Ericsson An E-Content initiative for the digitization of Arabic Content Privatization of Mobile Telephony has resulted in a wealth generation of almost EGP 35 billion Egypt companies as regional operators through acquisition of licenses in MENA, Asia and most recently in Europe Alcatel International Services Center Listed telecom companies are becoming the primary driver of Cairo-Alexandria Stock Exchange and are attracting FDI into Egypt either directly or through GDRs

17 A service-oriented Growth
Encouragement of further Public-Private Partnerships for infrastructure, services and industry development Provision of Converged Services Postal Sector restructuring Launch of MVNOs Further regional role in coordination and harmonization of policies and regulations as part of the global Information Society Promotion of ventures serving regional markets Call centers Internet exchange regional service centers

18 Useful websites

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