5G in Egypt: A Catalyst for Investment and Innovation

Updated 11/26/2024 8:00:00 AM

Egypt is on the verge of a technological revolution as it gears up to deploy 5G networks. Telecom Egypt’s Managing Director and CEO Mohamed Nasr announced during the Cairo International Technology Exhibition that network commercial operations are expected to start in the first quarter (Q1) of 2025 at the latest.

The 5G network activation is set to reshape the country's economic landscape, catalyzing growth across various sectors.

As the world embraces the transformative power of 5G, Egypt is well-positioned to capitalize on its potential and emerge as a regional digital powerhouse.

5G: A Multi-Sectoral Boon for Egypt's Economy

The introduction of 5G technology in Egypt holds significant promise for driving economic growth and development across various sectors. Dina Samir ElWakkad, an economics instructor and economist, tells Arab Finance: “5G technology can significantly boost key sectors in Egypt, such as healthcare, agriculture, manufacturing, transport, education, and tourism.”

“By enabling enhanced connectivity, automation, and real-time data processing across industries, 5G drives productivity, fosters innovation, improves operational efficiency, reduces costs, and supports scalable growth,” ElWakkad says.

For his part, Ahmed Mewafi, a PhD holder and strategic management and continuous improvement consultant, shares with Arab Finance, “5G infrastructure investment is a strategic necessity for Egypt to compete in the global digital economy.” He believes it would unlock innovation, bridge societal gaps, and support sustainable economic growth.

The deployment of 5G networks will support smart cities in Egypt. According to ElWakkad, 5G will facilitate IoT-based systems for efficient urban management, including smart energy grids and waste management.

Additionally, Ezzeldin Mostafa, a process manager at a leading telecommunication company in Egypt, praised 5G’s ability to provide high bandwidth and low latency for smart cities. “5G will ensure effective connectivity between various IoT devices simultaneously,” he says.

"5G allows near-instant communication and data transfer, minimizing downtime and enabling faster decision-making," ElWakkad adds.

She further explains that 5G networks are sought to offer ultra-reliable, low-latency connectivity, allowing companies to monitor their operations, supply chains, and equipment in real time. This in turn will help prevent issues from escalating.

Overcoming 5G Deployment Hurdles

Egypt has made significant strides in adopting 5G technology, but several challenges hinder its widespread deployment and full potential, with infrastructure being the most pressing issue.

“5G requires dense networks of small cells and towers to ensure widespread coverage and high speeds,” ElWakkad says, adding, “Egypt’s existing telecommunications infrastructure, especially in rural and remote areas, may need significant upgrades to accommodate 5G.”

Mostafa agrees, noting that network infrastructure needs to be stable, which depends on developing cell sites all over Egypt.

However, this obstacle can be overcome by infrastructure sharing. “Telecom companies can collaborate by sharing resources, such as fiber optic cables, cell towers, and base stations,” ElWakkad points out, suggesting that this approach would reduce costs and speed up the 5G deployment process, easing financial strain on individual companies.

Another challenge is spectrum availability. “5G requires a broader spectrum of radio frequencies compared to 4G,” ElWakkad explains. “Securing sufficient spectrum and managing interference demands coordination between regulators and telecom operators.”

To address this, the government should expedite the 5G spectrum allocation process and ensure fair distribution among telecom providers. This would foster competition, lower prices, and accelerate the rollout of 5G networks across the country, she illustrates.

High-speed backhaul networks are also essential for optimal 5G performance. Unfortunately, Egypt's current fiber optic infrastructure may not be sufficient to handle the massive data traffic that 5G will generate, as per ElWakkad.

“To unlock the full potential of 5G in Egypt, a multi-faceted investment strategy is essential,” Mewafi says. This includes upgrading infrastructure, bolstering innovation, forming partnerships, and building human capital.

“By focusing on these areas, Egypt can position itself as a regional leader in digital transformation, driving economic growth and enhancing the quality of life for its citizens,” Mewafi points out.

Attracting Investments with 5G

The launch of 5G networks will offer better connectivity, opening doors to more investments across various economic sectors. Mostafa says, “The future lies in IoT and generative AI, paving the way for investors to the future.”

Startups in Egypt can highly benefit from 5G networks. ElWakkad notes, “5G will offer startups numerous opportunities for innovation to emerge and thrive in areas, such as IoT, AR/VR, telemedicine, fintech, and smart infrastructure.”

“It can also help startups address market gaps like rural connectivity, urban management, and supply chain transparency, fostering economic growth and job creation,” she adds.

However, financial returns from 5G may take time to materialize as the technology requires widespread adoption across industries. “This creates uncertainty about investment recouping timelines, potentially deterring private sector participation,” ElWakkad warns.

Therefore, integrating private sector companies and the Egyptian government is critical to making the best returns of 5G deployment in Egypt. Mewafi emphasizes, “Public-private partnerships (PPPs) offer a win-win solution for deploying and utilizing 5G in Egypt. They combine government support with private-sector efficiency and innovation, enabling shared investment, accelerated rollout, and inclusive policies.”

“PPPs can position Egypt as a leader in the digital economy, driving sustainable growth and technological advancement,” Mewafi says.

As Egypt stands on the precipice of a digital revolution, 5G deployment is poised to reshape the nation's economic landscape. By addressing infrastructure challenges, securing sufficient spectrum, and fostering collaboration among stakeholders, Egypt can harness the full potential of 5G technology.

By Sarah Samir