IT Outsourcing - Egypt

Egypt

Revenue in the IT Outsourcing market is projected to reach US$576.10m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 15.30%, resulting in a market volume of US$1,174.00m by 2029.
The average Spend per Employee in the IT Outsourcing market is projected to reach US$17.41 in 2024.
In global comparison, most revenue will be generated in the United States (US$197.30bn in 2024).

Key regions: Netherlands, United States, Japan, Germany, Italy

Definition:
The IT Outsourcing market refers to the external contracting of IT functions, services, or projects instead of relying on company-owned resources. By outsourcing IT tasks (e.g., to IT suppliers or software developers), enterprises are able to focus on their core functions and save internal resources and costs (e.g., office space, maintenance, and utilities). Thus, outsourcing teams becomes a viable cost resilience strategy in an environment where companies are looking to save money more than ever.

In an IT context, these activities include IT administration, IT application, and web hosting services. Non-IT-related outsourcing services are excluded.

Structure:

IT Outsourcing contains four distinct markets that are based on different services:

Administration Outsourcing refers to the market for services associated with the external sourcing of typical IT administration tasks such as hardware supply, setup, configuration, maintenance, security, and support.
Application Outsourcing refers to the market for all IT application services in a software production context, spanning from requirement assessments to concept and design of software applications.
Web Hosting includes all types of internet hosting services that allow companies or individuals to provide access to their web page via the World Wide Web.
Other IT Outsourcing refers to aggregated revenues of the types of IT outsourcing that are not specifically mentioned in the other IT Outsourcing markets, such as infrastructure outsourcing, network outsourcing, and managed services.

Additional Information:

The IT Outsourcing market comprises revenues, revenue change, average spend per employee, and revenues of the outsourcing types. Market values represent revenues that are generated by primary vendors either directly or through distribution channels at the manufacturer price level (excluding VAT). Reported market revenues include spending by enterprises (B2B) and governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed. Key players in the market include IBM, Accenture, Capgemini, NTT, and Hewlett Packard Enterprise.

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Market

Region

Region comparison

Currency

Analyst Opinion

Egypt, a country with a rich cultural heritage and a rapidly developing economy, has been making strides in the IT outsourcing market.

Customer preferences: Egypt has become an increasingly popular destination for IT outsourcing due to its highly skilled workforce and competitive pricing. Many companies are attracted to Egypt's low labor costs and the availability of talented engineers and developers. Additionally, the country's favorable time zone and language capabilities make it an attractive option for businesses looking to outsource their IT needs.

Trends in the market: One of the major trends in the IT outsourcing market in Egypt is the growing demand for software development services. Many companies are looking to outsource their software development needs to Egypt due to the country's highly skilled workforce and competitive pricing. Another trend in the market is the growing popularity of cloud computing services. Many companies are turning to cloud computing to reduce their IT costs and increase their efficiency. This has created a significant demand for cloud computing services in Egypt.

Local special circumstances: Egypt's strategic location and favorable time zone make it an ideal location for IT outsourcing. The country is located at the crossroads of Europe, Asia, and Africa, making it easily accessible to many countries around the world. Additionally, Egypt's favorable time zone allows companies to work with their Egyptian counterparts during normal business hours, which can help to increase efficiency and productivity.

Underlying macroeconomic factors: Egypt's economy has been growing rapidly in recent years, which has helped to fuel the growth of the IT outsourcing market. The country has made significant investments in its infrastructure and has implemented a number of economic reforms to attract foreign investment. Additionally, Egypt has a large and highly educated workforce, which has helped to attract many IT outsourcing companies to the country. Finally, the country's favorable tax policies and business-friendly environment have also helped to make it an attractive destination for IT outsourcing.

Methodology

Data coverage:

The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.