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EGP 120bn investments in communications sector over the next five years: Atef Helmy - Daily News Egypt

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EGP 120bn investments in communications sector over the next five years: Atef Helmy

We are working to erase obstacles facing investors by amending rules and regulations, says Ministry of Communications and IT

Atef Helmy says that his ministry is developing public services in order to make them more competitive, productive, and transparent in offering clear services to the people. (DNE Photo)
Atef Helmy says that his ministry is developing public services in order to make them more competitive, productive, and transparent in offering clear services to the people.
(DNE Photo)

By Mohamed Alaa El-Din

The Ministry of Communications and Information Technology is looking to attract investments worth EGP 5bn over the coming five years, said Minister of Communication Atef Helmy in an interview with Daily News Egypt.

In the next few weeks, the ministry will begin building 27 buildings in the Technology Zone in Maadi, with investments worth EGP 2bn. According to Helmy, the ministry is establishing a suitable investment environment in the sector by amending rules and regulations and providing attractive investment opportunities.

Helmy declared that the ministry is issuing a smart electricity metre in the coming weeks in cooperation with the Ministry of Electricity and Renewable Energy. Thirty million meters will be issued with investments worth EGP 5-7bn. The ministry is also working with the Ministry of Industry and Foreign Trade and United Arab Emirates (UAE) to train 10,000 workers on technological equipment as part of the ministry’s plan to train the workforce.


What are the investment opportunities made available by the Ministry of Communications and Information Technology?

The state of the economy is currently a priority, and the communications and information technology sector is one of the most promising when it comes to investment opportunities due to its workforce and previous successes in investment plans. The Ministry of Communications and Information Technology has a plan for the sector’s strategy which focuses on two main points; the first is to attract investments and create job opportunities, while the second is to develop other sectors in the country through information technology.

This first point focus depends on the country’s past successes in leading the outsourcing industry of exporting information technology services to the Middle East, Africa, and Europe with more than 45,000 professional workers. To develop the industry, first the number of young workers has to increase, and the appropriate technological infrastructure must be provided in order to offer a convenient investment environment in the form of “technology villages”.

Regarding the focus on technology villages, within weeks, 27 buildings will be constructed in the technology zone in Maadi with investments worth more than EGP 2bn. Meanwhile, studies are being finalised for seven technology zones in Aswan, Assiut, Beni Suef, Damietta, Borg El Arab industrial city, 10th of Ramadan City, and Sadat City. Project studies should be completed by the end of this year so that they may be presented at the economic summit which will be held in Egypt in March 2015.

The Ministry of Communications and Information Technology is developing public services in order to make them more competitive, productive, and transparent in offering clear services to the people. The ministry will rely on cloud computing technology to apply these projects as well as the public-private partnership (PPP) system. The estimated amount of public sector investments through these services is between EGP 14bn -16bn.

Currently, we are working on an important project in cooperation with the Ministry of Electricity and Renewable Energy to provide 30m smart electricity metres and smart infrastructure with an investment cost ranging from EGP 5bn to 7bn. A workshop was conducted for this project few days ago, and another will be held within the coming days. The smart electricity metres help provide accurate analyses for electricity consumption and how it should be utilised best, in accordance with priorities.

Regarding the manufacturing and design of electronics, these form the main focus of the ministry’s plan, and we have a strategy approved by President Abdel Fattah Al-Sisi with investments ranging between EGP 15bn and 70bn within the next five years.


What role will information technology play in mega-projects?

The ministry has plans to develop and improve education through technological equipment, as well as the health and justice sectors, with a focus on implementing projects according to the current situation on the ground while taking into consideration tight liquidity. This is why the PPP system has risen to prominence. There are also many investment opportunities in the communications sector available as part of new Suez Canal projects, New El Alamein, and the Golden Triangle, as they will particularly need technological infrastructure.


The Suez Canal area is also poised to become the largest logistics area in the world and will require many technological services, as well as more than 17 marine internet cables. This will put Egypt in the centre of data transfer between east and west, north and south, especially in light of an increased reliance on internet services and applications which adds to Egypt’s competitiveness in attracting investment. Regulations for existing services must also be taken into account due to the fierce competition that Egypt faces in this arena, and especially since the global reports indicate that more than 5bn devices that connect to the internet will have been obtained by the year 2020.

What is expected value of investments in the communications and IT sector under the ministry’s plans?

We have a plan for the next five years to attract EGP 120bn, a big portion of which will be in infrastructure. The high-speed internet project will receive EGP 40bn of these investments and targeted yearly investments in the sector will exceed EGP 20bn.

What economic incentives will the ministry provide to create a favourable investment climate for the sector?

The ministry is already working on several points to improve the investment climate in the sector. The communications law has been amended and is now pending approval with the legislative committee of the cabinet, with expected adoption in 2015.  One article in the electronic signature law was amended to allow for an expansion in electronic signatures, and the ministry has finalised its portion of the freedom of information law. In this manner the ministry has adopted electronic solutions for payment operations, which is already an option available for paying traffic fines. In near future, the sector will witness the popularisation of cards issued by electronic payment companies, or what is known as the “plastic card”.

When will the main points of the ministry’s plans be implemented?

Several main points of the ministry’s plans for the sector that have been partially implemented, and others are currently being implemented. Still others remain under study, the most important of which is the unified licence. Work is underway to find solutions for all contentious articles in order to create a result that is not detrimental to any of the four major communications companies. As for high-speed internet, the pilot project has already been launched and is currently being implemented.

A government cloud computing project will be launched in the coming weeks, and more than 60 protocols have been signed with various government agencies for the portion of the project dealing with infrastructure informatics and data review and analysis. Projects relating to this initiative number more than 150, and this week, the first of PPP projects pertaining to the mechanisation of 270.

The ministry has taken serious steps in the field of electronics manufacturing and design by establishing an IT institute in Suez Canal University to teach these subjects, and a protocol was signed to construct the first innovation complex in the technological zone in Maadi. This will provide for the construction of what is known as “clean rooms” to facilitate entry into nano-technology manufacturing, and cooperation agreements have been signed with six engineering universities to teach advanced industry in the field of electronics.

The ministry has also intensified foreign visits in order to attract new investments in the sector. A senior Microsoft official, Vice President of VISA in Middle East, and Vice President of Intel visited have all visited Egypt, and in a few days the Vice President of EMC, the CEO of IBM, and the President of Mentor Graphics will also visit the country. The ministry also managed to train between 15,000-20,000 youth on the outsourcing industry and technological services amid plans for community development through which 70% of them have been employed.

An agreement has been signed between the Ministry of Industry and the UAE to train an additional 10,000 youth in the near future, and more than 700 schools have been equipped to suit special needs students. Twenty-three labs were added to various schools alongside computer literacy classes.

With regards to information security, work on the cyber security centre has begun, which is the first of its kind in Egypt in light of the amendment to the cyber security law. Consultancy firms are preparing feasibility studies for the technology valley project so that the correct decisions for the project may be made.

Etisalat Egypt has raised objections to the unified licence to the degree that it has resorted to the Egyptian Ministry of Defence. Should it not be a priority to resolve obstacles faced by investors before seeking to attract new investments?

We are working on addressing both at the same time in order to remove obstacles faced by investors and attract more investments. Etisalat Egypt did not resort to the Ministry of Defence with regards to the unified licence, but to receive new frequencies, and this was done in coordination with the communications ministry.

Mobile phone operators requested new frequencies; what is the status on that? And what are the values?

We are coordinating in the short and long term to provide necessary frequencies for mobile phone operators and we intervene in a limited manner on this subject because there are many authorities that intervene in this regard. As soon as the frequencies are available they will be announced.

Are you satisfied with the performance level of internet services?

Of course not, but we should keep in mind several challenges, most important of which is the fact that infrastructure over the past three years witnessed many incidents of vandalism and theft in addition to the steady increase in the number of internet users. Some customers have even established illegal connections, and companies have not invested properly. All of these form challenges that have a negative impact on internet service performance, while at the same time, the number of users constantly increases in tandem with existing internet-based applications. These challenges will be overcome when a national entity for infrastructure is created.

It will soon be announced that internet use via satellite will be available, while studies and tests are currently being conducted as a prelude to make the service available to users.

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