Egypt’s ITIDA disburses EGP 70m in export incentives to IT companies

Daily News Egypt
5 Min Read

Egypt’s Information Technology Industry Development Agency (ITIDA) announced, on Monday, that it has disbursed EGP 70m in export incentives to information and communication technology (ICT) companies in the country.

This comes as part of the 11th round of the agency’s Export-IT 2019 cash rebate on ICT exports by local ICT companies.

The finance has been paid to a total of 131 out of 137 companies that have applied for the programme this year.

ITIDA CEO Amr Mahfouz said, “The export IT programme is part and parcel of ITIDA’s strategy that primarily aims at boosting Egyptian IT exports, increasing competitiveness, and enabling them to expand and access global markets.”

Mahfouz said that ITIDA attaches great importance to its IT export programme, in light of the challenges of the novel coronavirus (COVID-19) pandemic.

This is in addition to the unprecedented government support and commitment to boost exports as one of the main sources of foreign currency for the Egyptian economy.

Based on the request of Egyptian ICT companies, the agency has reopened the submission of documents for the “Export IT” 2020 rebate disbursement for a period of two weeks.

The submission window will now last until the end of July, and aims to expand the base of beneficiary exporting companies.

Earlier this year, ITIDA launched an exceptional round of its annual “Export IT” programme, to handle the challenges introduced by the COVID-19 pandemic. The round aims to offer local IT companies cash incentives on the proceeds of value-added exports for two consecutive years, covering 2019 and 2020.

The agency said that 33 companies applied for the programme for the first time, while 22 startup companies joined this year. The 11th round of the programme saw the participation of new companies from governorates other than Greater Cairo, including Alexandria, Daqahleya, and Ismailia.

All export transactions and supporting documents have been audited, reviewed, and cross-validated by the programme’s external auditor.

The “Export IT” programme accepts local ICT companies that have more than 50% Egyptian ownership, and are headquartered in Egypt. These companies should export ICT services and IT-enabled capacities, such as call centre services, consultation, and training services related to the IT industry.

ITIDA has excluded Egyptian IT startup companies that were founded in 2016 or later from the “headquartered in Egypt” condition.

According to the terms and conditions of the programme, approved companies receive direct cash incentives of up to 10%, and with a maximum limit of 20% of value-added exports. These are based on the company size, with a maximum amount of EGP 2.5m for each company, or EGP 3m for companies operating in or who have branches in one of Egypt’s new tech parks.

The programme offers additional incentives to companies exporting e-commerce, e-gaming, e-health, and e-design services. Further incentives are also granted to companies operating in new tech parks, new entrants to the programme, and companies operating outside Cairo, Giza, and Alexandria.

Exceptionally, ITIDA has accepted medium-sized companies with annual revenues exceeding EGP 50m, those who export emerging technologies services, or those who have succeeded in penetrating new markets.

This falls in line with the agency’s new strategy to promote and encourage exports of disruptive and emerging technologies, such as artificial intelligence (AI), data science, and Robotic Process Automation (RPA).

These companies have enjoyed the benefits by getting full export support on the total value added of their export earnings.

Throughout the eleven previous rounds of the “Export IT” programme, ITIDA has extended support to more than 230 Egyptian companies, with a total value amounting to EGP 480m.

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