Huge capital investment is changing the face of modern Egypt, but is this growth being reflected in its AV sector? Paul Milligan speaks to those on the ground.
It has been anything but dull in the last five years in Egypt. Internal and external investment has surged which has seen a slew of huge infrastructure projects get the go-ahead, including the construction of a whole new city. Egypt’s economic outlook is on an upward trajectory, with a predicted GDP growth of 4.7% in 2025-2026, surpassing the IMF’s previous forecast of 4.1%.
Running in tandem with this growth is a dual devaluation of its currency in the last three years, the last time in 2024 when the IMF intervened. While the country’s financial fortunes have been fluctuating, it has become politically stable, and you can’t say that of many of its neighbours, with wars in recent times in Ethiopia, Sudan, Libya and the ongoing conflict in Gaza to name a few. So where does this leave the country’s AV sector? We spoke to a selection of system integrators, events companies and distributors to find out.
According to recent figures, Egypt has the second biggest economy in Africa behind South Africa, but is that reflected in the size of its AV market? In 2025 so far and in the latter half of 2024 the answer would be no says Hisham Allam, CEO and founder of systems integrator Egyptian Micro Solutions (EMS), with Allam highlighting the economic crisis and the new regulations from the IMF as a major reason why. The AV market in Egypt has seen steady growth in the last five to six years says Mohammed Attia, managing director of integrator Quality Egypt, “but it’s still not as mature as some of the markets in the Gulf area. The economy is ranked second in Africa because of our location. There’s tremendous potential for the AV market, especially in the education, transportation, and visitor experiences (sectors).”
The increasing adoption of digital technologies in Egypt, and ongoing investments in various sectors will drive demand for AV systems in the next two to three years says Tarek Harby, AV department manager for integrator Tatas AV Solutions. There are several contributing factors he says, “Egypt’s ongoing infrastructure projects and increasing foreign investments are creating opportunities for AV systems in business, education, and entertainment [sectors]. Increased internet penetration and the growing adoption of digital technologies in Egypt is contributing to the demand for AV products and services. This includes corporate AV systems, and educational technology in schools and universities.”
The last two to three years has been fantastic for the AV sector says Allam, “because Egypt was building a new capital (the New Administrative Capital – more on that later) and 12 new cities as well, plus a new military complex 10 times the size of the Pentagon, so the projects were fantastic, and we’ve done a lot of those projects. We worked on the new parliament and did 500 meeting rooms for the new Egyptian cabinet, as well as crisis rooms and operational centres.”
However, Allam is not as buoyant looking forward, “2025 will decide what’s going to happen in 2026 and 2027 because of the geopolitical conflict we have in Gaza, Sudan, Libya, and Ethiopia. There are a lot of challenges for Egypt, it’s not easy, plus the new tariffs imposed by President Trump will affect everyone.” Money will still be invested says Attia, just in different areas than we’ve seen in the last five years: “I think there’s a big shift in more of the sectors now, infrastructure projects are slowing down and projects in hospitality and heritage and museums and culture are getting more active. What we’re there’s around 20 hotels are being built in in Egypt now, for the first time Egypt has reached around 16 million visitors in one year. There are five new airports being built (or expanded from private use) in new areas (Ras El Hekma, St Catherine, Borg El Arab, Sphinx and El Alamein), we are looking at a lot of growth in the coming years.”
There is certainly a lot of activity in Egypt right now, figures from last year show that Egypt was home to $85 billion worth of ongoing and upcoming infrastructure projects. With total government projects standing at $187 billion (for comparison, South Africa is second placed in Africa with $120bn). A lot of this work is under the umbrella of the ‘Egypt Vision 2030’ strategy and the ‘Digital Egypt’ initiative. The latter project aims to modernise government processes through automation, and to enhance public services through technology, ultimately building a digital economy. Key recent projects include the building of the largest railway station in the country in Bashteel with a capacity of 250,000 passengers a day.
The Ras El-Hekma project is a massive investment on Egypt’s North Coast, involving a partnership between the Egyptian government and the UAE’s ADQ (an Abu Dhabi-based investment company). It aims to develop a new city with tourism and financial districts, potentially attracting over $150 billion in investments. The digitisation strategy was also behind the announcement in 2023 from Egyptian prime minister Mostafa Madbouly that Egypt is to build 24 smart cities, with plans to expand that to 38 cities by 2050. Launched in 2016, the first phase of Egypt’s Smart Cities program, funded with over $1.25bn, focused on redeveloping 312 residential areas previously deemed unsafe for habitants.
The ongoing second phase, with a budget of $10.25bn, aims to revitalise more areas by 2030. The goal is that these areas will be powered by renewable energy sources and feature eco-friendly housing, green spaces, all underpinned by technology. The New Administrative Capital or NAC for short (the city hasn’t been given an official name yet), is located 45km (28 miles) east of Cairo, and is the flagship of Egypt’s smart city programme. Designed to ease overcrowding in Cairo, this new city will ultimately cover an area the size of Singapore, and be home to six million residents, along with Egyptian government offices, a financial district, and other facilities, all powered by renewable energy again. Phase one of NAC has cost $10.6bn, with future plans for NAC that include 18 hospitals, 1,250 mosques and churches, a 93,440-seat stadium, 40,000 hotel rooms, a theme park four times the size of Disneyland, 90 sq km of solar energy farms and an electric railway link with Cairo.
But what does all this mean for the local AV market? If there are big projects around, and it clearly seems there are, will they be going to local AV companies or are big AV companies from outside Egypt swooping in and picking up contracts? If it’s a local client they’re probably looking for a local AV supplier, says Maged Abdel-Wadood, founder and managing director of systems integrator Intellitech, but “if it’s corporate multinational they probably have something signed, either exclusive or semi-exclusive with the AVI-SPL’s of this world, it will generally go through those, and it’s almost impossible to break in.”
Foreign AV firms are often deterred from Egypt because of the paperwork involved says Hamed Arafa, founder and chairman for rental and staging company Hilights Group. “It’s too hard to get an AV company outside from Egypt to come to Egypt because of the customs and logistics, it’s not easy.” Attia agrees: “We don’t have a lot of influence of European and American system integrators like in the Gulf. The main players here have the local recognition they can deliver on the ground, they understand the regulations and the codes, they have integration experience, and they have good engineers on the ground with good engineering experience.”
Is ‘Egypt Vision 2030’ having a positive effect on the local AV sector? Opinion is mixed. It is creating opportunities says Harby, “A core element of ‘Vision 2030’ is the drive towards a digital economy and the integration of technology across all sectors. Vision 2030 aims to create a competitive and diversified economy, attracting both local and foreign investment. This economic growth will spur development across various sectors, including corporate, tourism, and retail, all of which rely on AV technologies.” Others are more cautious about its influence such as Vivek Mishra, VP at Mindstec Distribution. “2030 is considered as a major milestone for overall industry development including AV, but this is all subject to global market stability and investors’ confidence in that particular territory.”
Looking at the wider AV picture, are Egyptian clients willing to invest in service contracts from integrators once the installation is finished or do they just want to pay for the installation? “The IT team will try and run it themselves,” says Abdel-Wadood. “They think they can learn Crestron and QSC coding and all that stuff. Go ahead, give your best shot, but they come crawling back.” It’s a big problem in Egypt agrees Attia; “We’re trying to pass on the knowledge to clients that service contracts are very important, especially in the AV industry. The Egyptian market is still not very mature, the mindset is shifting now, and our role is to give awareness to clients and to the operators of the importance of service contracts and maintenance.”
Finally, what are the biggest challenges facing the Egyptian AV market right now? The biggest problem is the Egyptian currency, which in the last four years has increased almost 400% says Arafa. “We came from $1 was 8 Egyptian pounds, now it’s 52 Egyptian pounds, imagine if you are buying lighting fixtures with $1,000, it was 8,000 Egyptian pounds, now it’s 52,000 Egyptian pounds.”
AV integrators and distributors face a combination of issues right now says Harby, especially currency exchange rates. “The regulatory environment in Egypt must be more flexible too, with varying import tariffs and customs regulations that can impact the cost and availability of AV equipment."
Companies coming into the AV industry from other sectors looking for quick financial wins are causing issues, says Abdel-Wadood. “It’s every Tom, Dick and Harry that believes they’re an AV integrator and doesn’t know how to price, who undercut you by 30 or 40% and go into the project, screw it up completely, and then the client calls you up to come and fix it. I have nothing against people coming into the market trying to get a foothold in it, but there’s a lot of people who don’t actually know what they’re doing, they can install a satellite dish, but they can’t do the rest of the stuff and it’s not an easy job.” Keeping talent is a major issue in Egypt says Attia, “the Gulf is taking a lot of our engineers, and they are going in their hundreds if not thousands. You cannot compete with the salaries and the standard of living between Egypt and the Gulf. We invest heavily in training and in knowledge transfer, but we cannot keep most of our talent here in in Egypt.”
There are clearly challenges in the Egyptian AV market, currency fluctuations being the main one, but that seems to have settled in the last 12 months, and building work across the country is progressing at pace. While some of the big governmental projects might be slowing down, it seems there are other sectors such as hospitality and culture/heritage taking their place, which is good news for AV firms.
The centrality of Egypt’s location is also a benefit and a problem to its AV sector. It has easy access to work in a lot of other neighbouring countries but is also susceptible to competition from richer countries in the Middle East. There does seem to be a significant push from the government to modernise the country and there is a clear goal for all aspects of Egyptian society to become more technologically advanced and to build more digital infrastructure, and that can only benefit the AV sector.
It will be fascinating to watch how much of the vision it has for itself for the future is actually fulfilled, as we have seen from Saudi Arabia’s plans for NEOM that have been scaled back, achieving ambitious goals is not always possible, but that doesn’t mean Egypt shouldn’t try.
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Quelle/Source: Inavate, 01.05.2025
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