Amidst the 2024 business outlook, recent research supported by DP World and conducted by Economist Impact tells that Egyptian companies are increasingly embracing technology despite the challenges faced in 2023 and concerns over geopolitical events affecting the economy.
The fourth Trade in Transition report highlights a notable increase in technology adoption and flexible trade strategies among Egyptian businesses. This study draws insights from global trade experts and senior executives, including those from Egypt.
Despite challenges such as inflation, interest rates, and market downturns, Egyptian companies are reevaluating risks through various strategies. One such strategy is friendshoring, where companies align with suppliers from economically and politically similar countries. Additionally, they are exploring new markets for export growth and implementing dual-sourcing strategies.
According to the survey, 28% of Egyptian executives plan to leverage technology to enhance supply chain efficiency and agility in the context of global trade’s future. Technology adoption is seen as a driver of business optimism.
Almost half of the executives (48%) acknowledged their firms’ use of AI in 2023 to transform supply chain operations, with an additional 20% aiming to adopt it in 2024. They are exploring advanced automation (33%) and blockchain (28%) to improve traceability, security, and data protection.
Consolidation is a key priority for Egyptian businesses aiming to minimize supply disruptions. They are balancing between diversification and control, and risk management. About 34% are practicing friendshoring, shaping trade and supply chain operations, while 31% are creating parallel supply chains for different markets. Additionally, about a third are opting for fewer suppliers.
As Egypt’s economy expands into new sectors and positions itself as a manufacturing hub in Africa, 28% of executives view market expansion as the primary driver for export growth. Europe (37%) and North America (34%) are expected to significantly boost export revenue in 2024. Technological advancements (35%) are anticipated to increase output levels and import values.
Despite cautious optimism, business leaders face substantial export and import challenges due to transportation costs, input shortages, rising inflation, economic volatility, tariff uncertainties, and political instability in crucial markets.
Rizwan Soomar, CEO & Managing Director of DP World for North Africa & the Indian Subcontinent, expressed optimism in line with the surveyed Egyptian executives. He highlighted initiatives in Egypt where technology implementation addresses business challenges and strengthens resilient supply chains. The aim is to build resilient supply chain solutions enabling businesses to navigate trade challenges seamlessly and efficiently.
