IT exporters to enjoy new stimulus package: ITIDA

The program is offered to local information and communication technology (ICT) firms with more than 50% of Egyptian ownership

  
Image used for illustrative purpose. Cairo Skyline along Nile River. The bridge, the Nile river & the Corniche Street in central Cairo.

Image used for illustrative purpose. Cairo Skyline along Nile River. The bridge, the Nile river & the Corniche Street in central Cairo.

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ArabFinance: Local IT exporters in Egypt are granted incentives on proceeds of value-added exports for the years 2019 and 2020, the Information Technology Industry Development Agency (ITIDA) said in a January 18th emailed press release.

ITIDA has launched a new round of its annual Export IT program to ease the challenges introduced by the COVID-19 pandemic.

Considered the first of its kind since the launch of the initiative in 2010, the cash incentive aims for IT companies to “develop their resources, enhance competitiveness, and reduce export overheads,” ITIDA noted.

The program is offered to local information and communication technology (ICT) firms with more than 50% of Egyptian ownership, and that are headquartered in Egypt. The firms should be exporting ICT services or IT-enabled services like call center, consultation, and training services.

IT startup firms that were founded in 2016 or later are being excluded from the “headquarter in Egypt” condition to enroll in the program, ITIDA stated.

Accepted IT exporters will receive direct cash incentives of up to 10%, and with a maximum limit of 20% of value-added exports. This will be based on the company size, whether micro, small, medium, or large.

The program offers “a maximum amount of EGP .5 million for each company or EGP 3 m for companies operating in or have branches in one of the new tech parks,” ITIDA elaborated.

The IT state body will be “exceptionally accepting” medium companies with annual revenues of more than EGP 50 million and export IT-related services or have succeeded in penetrating new markets.

“These companies will get the full export support on the total value added of their exports and not only on the growth of their value-added,” ITIDA confirmed.

Through the “Export IT” program, ITIDA intends to boost the growing volume of local IT exports, which recorded $4.1 billion (EGP 64.33 billion) in 2020, up by 13% annually from $3.6 billion (EGP 56.48 billion).

Last year, ITIDA disbursed EGP 11.86 million as the second batch of cash incentives for certain local companies, noting that IT exporters would benefit from the Export IT Program’s 10th round.

*At press time, the conversion rate is $1 = EGP 15.69

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