Business association calls on central bank to accelerate digital transformation in Egypt’s financial sector

Published 21 Oct,2020 via Daily News Egypt - Sherif Makhlouf, member of the Egyptian Junior Business Association (EJB), has called on the Central Bank of Egypt (CBE) to accelerate the implementation of Egypt’s digital transformation process in a number of areas.

“On top of that, it is necessary to work fast on paving the road for digital transformation, as well as investing in capacity building and jobs for the future,” Maghlouf said.

He added that Egyptians must also learn and benefit from the experiences of other countries, which have managed to put digitisation into practice. A framework needs to be implemented in Egypt’s education system to encourage innovation and intellectual openness.

Makhlouf said that the academic curriculum in many Egyptian colleges should be developed, alongside a set of laws and legislations related to digital transformation. This would then ease the removal of all trade obstacles hindering entrepreneurs and small- and medium-sized enterprises (SMEs).

There is also a need for further steps to be taken to accelerate the completion of electronic government services, and expanding on financial inclusion. This would include encouraging entrepreneurs to adopt and implement digital projects to push the economy forward. As part of this, Egypt needs to place importance on putting in place new legislations to reduce the risks of using digital currency.

Makhlouf called on the CBE and Egyptian banks to support innovative initiatives for dealing with the digital currency, in line with moves to develop electronic taxation systems.

This would in turn work to eliminate tax evasion, which costs the Egyptian state EGP 160bn annually. It is noteworthy that Egypt’s informal economy nearly equals the organised economy in size, and is considered an issue of concern.

Makhlouf noted that the setting up of government and private sector business incubators should be encouraged, through a partnership between the government and businessmen.

“Support for SMEs must continue so that they can develop their digital capabilities,” he said, adding that digital technologies account for 30% of the Egyptian industrial sector’s contribution to GDP. Such is the importance of these technologies, that the GDP contributions of some industrial sectors double every year.

“Information and communication technologies represent 70% of global investment, and with the second wave of the novel coronavirus (COVID-19) set to begin during the winter, this crisis may accelerate this growth further, and encourage more digital technologies to be employed in all industries,” Makhlouf added.

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