Egypt has consistently positioned itself to become a major hub of business and technology services to organizations situated in North America, Europe, the Middle East and Africa. As a result, the Middle East and North African nation has grown to become one of the leading business process outsourcing (BPO) and information technology outsourcing (ITO) destinations in the global marketplace.
Egypt’s BPO/ITO Market:
According to the International Data Corporation (IDC), Egypt’s market share of the global BPO market was estimated to grow to 16.9% by 2019. Moreover, the combined IT, BPO, and KPO export market in Egypt was forecast to grow from $3.2 billion in 2017 to $4.7 billion in 2020, according to IDC.
BPO/ITO Value Proposition:
In a nutshell, Egypt’s core value proposition in the BPO/ITO market includes:
Egypt as a Key Location for IT/ITES Services
“Egypt has one of the largest IT workforces in the world. Engineers comprise a significant portion of Egypt’s human capital pool,” says Rasha Ezz El-Din Mohamed, Sales and Marketing Director of Egyptian BPO/ITO outsourcer, Xceed.
“Out of its 540,000 annual university graduates, over 50,000 have IT-related qualifications, further adding to the talent pool, as well as growing Egypt’s IT-enabled service (ITES) capabilities. Together with a thriving entrepreneurial scene, Egypt has a rapidly growing market for digital and analytics offshoring.”
Workforce Quality
The variety of skills and knowledge stemming from graduates have deepened the Egyptian BPO/ITO talent pool. According to the national statistics office, CAPMAS, Egypt produces the following variety of graduates that flow into BPO/ITO businesses per annum, on average:
This enables BPO/ITO service providers to draw new workers from a variety of different specializations and industries, including data management, customer experience, education, training and financial services.
Multilingual Offering and Cost Competitiveness
“Graduates in Egypt are finishing their university education with proficiency in a wider variety of languages that allows companies in Egypt to provide tailored BPO/ITO services,” says says Ezz El-Din Mohamed. “In fact, over 90,000 Egyptians graduate annually with English-language qualifications, making Egypt highly-favorable in the United States and Australian BPO/ITO markets.”
Arabic is also the native language of Egypt and thus opens doors to offer BPO/ITO services to 300 million Arabic consumers globally, including its home market. Other languages spoken by Egyptians include:
Low Labour Costs
Despite having proficiency in a wide number of languages, Egyptian BPO/ITO services are cost-performance-effective. BPO/ITO workers in Egypt have lower salaries compared to other established BPO/ITO destinations. The average median salary for contact center agents is estimated to be US$402 per month and for contact center managers it is estimated to be US$950 per month, according to the All-Africa Global Business Services Benchmarking Survey by Knowledge Executive (2020).
Median monthly salaries for contact center agents across African BPO/ITO markets:
Source: All Africa Global Business Services Benchmarking Survey by Knowledge Executive (2020)
In the ITO market specifically, the labor costs are low compared to other established ITO destinations. On average, an Egyptian Junior Software Developer earns between US$480 to US$601 per month. Data analysts earn an estimated US$346 per month and IT Managers up to US$1,051 per month according to salary reviews conducted for the All Africa Global Business Services Benchmarking Survey.
Covid-19 Response and New-Normal Transition
“During the global Covid-19 pandemic, Egypt’s BPO/ITO industry experienced a smooth transition to work-from-home set-ups thanks to its existing reliable, internet infrastructure,” says Ezz El-Din Mohamed.
“This enabled BPO and ITO companies in Egypt to migrate 50% to 85% of their workforce to work-from-home in a two-week timeframe with zero disturbance in service delivery.”
In fact, Egyptian BPO companies made the necessary arrangements to make sure that their workforce was able to work-from-home effectively by providing laptops, installing business and security systems, and allowing workers to take other office equipment home, according Ryan Strategic Advisory. This resilience of the country to the pandemic has encouraged a number of multinational companies to divert their attention to Egypt as an ideal location for business continuity.
ITIDA has also implemented several Covid-19 initiatives to support the country’s BPO/ITO industry, which are aimed at boosting remote working and freelancing, providing solutions relating to the pandemic, expediting cash reimbursements and shifting to online processes. These initiatives include the following:
Conducive Business Environment
The Egyptian government has successfully crafted a business environment that makes it appealing and easy for foreign investors to establish BPO/ITO operations in the country. This has been achieved through the implementation of key economic reforms and programs.
Specialized centers and laws have been established to vastly improve ease of doing business and thus attract foreign direct investment (FDI) into Egypt. Some of the laws that have created a conducive business environment in Egypt include the following:
The centers that have been instrumental in fostering a conducive business environment include:
As a result, Egypt is ranked fourth in the cross-market favorability rankings for front office BPO buyers globally.
Egypt has also achieved the following rankings and accolades:
Source: 2021 Global Front Office BPO Omnibus Survey by Ryan Strategic Advisory