Microsoft’s focus over the next period is to complete the implementation of the automation of databases for government bodies. According to Khaled Abdel Kader, general manager of Microsoft Egypt, the Egyptian market is promising with a great deal of potential on the horizon after the flotation of the Egyptian pound.
What is Microsoft’s evaluation of the investment climate in Egypt after the local currency’s flotation?
The flotation of the pound is positive for the investment climate. Our partners in Egypt suffered severe losses due to high price of the US dollar against the pound and the unstable exchange rate. Their losses amounted to 50%, though we bore these losses on their behalf by collecting the contract value in Egyptian pounds since 2011.
In addition, the collected contract value remained at banks and was not repatriated. This caused Microsoft to lose 120% of the value of these contracts, on the back of the exchange rate rising from EGP 7.5 to EGP 17.
But we believe that the Egyptian market is promising with much potential for growth. This is why we are continuously investing more in Egypt.
Floating the pound should bring an end to the losses we have suffered over the past year. It is also a first step in the path to improving the investment climate. To be effective, this step should be followed by monetary and financial policies that secure hard cash. The government should step on the gas pedal and issue the new investment law, especially after the International Monetary Fund approved the loan. Moreover, the state should work to restore tourism and continue improving the investment climate, amid the interest of big investors in the Egyptian market.
Why is the Egyptian market still attractive for investment?
Mainly because it is a large market of more than 90 million people. The demographics of Egypt and its location can be used to move Microsoft’s Digital Transformation Centre to the rest of the continent. In addition, the influence that Egypt has on many countries and the abundance of unexploited manpower helps its market.
What strategic plan does Microsoft have for the coming period?
Owing to the availability of human resources, the information technology sector in Egypt is highly competitive in the Middle East, as well as Eastern and Central Europe. This makes us confident in the importance of the market, which was the main reason why we continue to increase the size of our investment in Egypt, especially over the past four years, during which we doubled the number of employees.
In the coming period, we will work to support small- and medium-sized enterprises (SME) with technological services and solutions, in addition to women empowerment programmes and entrepreneurship support schemes. We believe that Microsoft will have a more effective role in the coming period, as clients will need technological solutions to rationalise spending and increase productivity—which is our field of expertise.
Did you change the value of your contracts with the government following the flotation of the pound?
We did not change the value of these contracts with government bodies, but rather endured the losses of the exchange rate. Some of our contracts dropped by 50% in value.
How many partners do you have in Egypt?
We now have 1,300 partners in the Egyptian market.
What are the most prominent government projects you are implementing now?
We have ongoing contracts with government bodies and ministries. There are over 60 projects that we are implementing with the government. For example, we are now implementing a mechanisation and automation project for the General Authority for Investment (GAFI). We have completed part of it—related to the establishment of companies. This project, along with other factors, helped Egypt advance 39 rankings on the Competitiveness Index.
We are also working on a similar project for automating domestic trade. This is a big and important project, starting with food holding companies through more than 500 distributors. Furthermore, we are working on the Gam’iety project, which is linked to subsidies and aims to supply basic commodities at affordable prices in governmental stores.
Moreover, Microsoft is carrying out a project to link databases, which is related to the automation of domestic trade. This is a project that targets to improve the subsidies system and deliver support to the most vulnerable segments of society.
What are your solutions for SMEs in the coming period?
We have provided a comprehensive initiative that works through establishing an electronic platform for the development of SMEs, in cooperation with the presidential Economic Council, the ministries of communications and information technology and industry and trade, the Federation of Egyptian Chambers of Commerce, the Federation of Egyptian Industries, and the Central Bank of Egypt (CBE).
The initiative aims to enable and empower all investments in SMEs, starting from the core idea of transforming the ideas into real projects that offer products or services. The initiative will provide human resources development solutions to SMEs and assist them in obtaining funding from banks or grants, as well as investment funds and the Social Fund for Development. It also assists companies in designing work plans that fit their activities and plan their expansions abroad.
Through the platform, anyone with an idea can reach out to experts and discuss it. If the innovation is valid, it will be patented. Then, a scheme is penned to help implement the idea and turn it into a company through training programmes and preparing work plans. The entrepreneur is later connected to funding institutions and consulting firms that can train the required manpower. The platform then markets their production in Egypt and abroad. If the company goes bankrupt, we would also begin to restructure and rehabilitate the company.
Moreover, the platform can assist start-ups in obtaining the necessary government permits online. This initiative is not limited to projects in the IT sector, but is aimed at all projects across all sectors. No matter what the idea is, entrepreneurs are directed to assist entities that fit their schemes.
Once the platform is complete, it will become an SMEs investment map and will contribute to the implementation of the Sustainable Development Strategy: Egypt Vision 2030. Our plans include serving some 300,000 SMEs.
What will Microsoft present during Cairo ICT 2016?
We will present our solutions in digital transformation, its importance, and its outcome through illustrating the difference made by adopting this service. We will also explain our definitions for privacy and our security solutions.