Egypt Offers Example How Developing Countries Can Plan For Ecommerce
Famed for its ancient souks and bazaars, Egypt is now looking to the future of commerce by backing a far-reaching strategy that aims to double the number of businesses selling products and services online by 2020.
UNCTAD’s National Ecommerce Strategy for Egypt was presented in Geneva during Ecommerce Week as a best practice example of how developing country governments can work with intergovernmental and private sector partners to plan for an ecommerce ecosystem that boosts growth, skills and jobs.
The potential for ecommerce in the Arab-speaking world’s most populous country is pyramid-sized. A government survey found that just five percent of internet users over 15 years old in Egypt shop online, and this figure drops for women, older people and people living outside cities and towns.
And very few Egyptian enterprises currently sell online—only one in 10 handicraft enterprises use the internet in any way, and only a fraction of these sell their products online.
“This strategy is not only relevant to Egypt since it could be replicated elsewhere,” UNCTAD Deputy-Secretary Isabelle Durant said. “We hope that it will be useful for Egypt to share its experiences with other countries.”
“Ecommerce offers developing countries like Egypt opportunities for inclusive growth and enhanced market access,” said Yasser El Kady, Egypt’s minister of communications and information technology. “Small and medium sized enterprises are the engine of growth, hence leveraging e-commerce can bring great benefits. Egypt hopes to be among the top 30 knowledge economies by 2030.”
El Kady said that the strategy is part of the Vision 2030, a national economic plan elaborated by the Egyptian government.
“We have been investing big time in information and communication technology infrastructure over the last three years, including, for example, in 5G networks,” he said. El Kady added that with more than 4,000 post offices, Egypt’s logistical and micro-financial infrastructure offered a competitive advantage. A similar opportunity existed in its young, well educated population and its geographical position as a global telecoms hub.
In devising the strategy, UNCTAD and the Ministry of Communications and Information Technology worked with other United Nations agencies and the World Bank. Funding was provided by US multinational financial services corporation Mastercard.
“Mastercard will continue to support the execution of the strategy to further advance the payment ecosystem and showcase the benefits of digitization in the country,” said Khalid Elgibali, Mastercard’s Division President for the Middle East and North Africa region. “The National Ecommerce Strategy is a testament to our shared goals of a more inclusive, effective payments ecosystem.”
The strategy, the first such national ecommerce strategy developed by UNCTAD after a request from a member state, sets out an overarching objective and six sub-strategies, recommendations, six “mega-projects”, and an action plan. The strategy also gives guidance on implementation, monitoring and evaluation.
It focuses on bottlenecks identified by an analysis of Egypt’s e-commerce landscape, and makes recommendations in eight policy areas: technology infrastructure and telecom services; logistics and trade-easing measures; laws and regulations; electronic payments; and electronic platforms; skills development and building talent.
Research undertaken as part of the strategy found that Egypt needs to establish an authentication framework for e-payments, such as 3D secure, adopt universal banking, create new payment methods, and strengthen e-money products such as mWallet.
The strategy advises that awareness of e-payments could be raised by such measures as lucky draws and a national lottery, and that zero liability for customers in unauthorized transactions should be adopted.
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