Tag: global services

Egypt: A Safe Bet in the MEA Region in Unstable Times? | Blog

Given the current unrest in the Middle East and Africa (MEA) region, Egypt can potentially be a reliable choice for businesses seeking stability. Egypt’s support for US interests and its impartial stance in conflicts make it an appealing option for ally-shoring. To better understand the pros and cons of selecting Egypt for service delivery now, keep reading.

The MEA region is currently experiencing significant turmoil characterized by ongoing conflicts in Syria and Yemen, strained relations between Israel and Iran, and persistent tensions between Lebanon and Israel.

The Israel-Hamas conflict that began on October 7 has further intensified the regional instability, leading many global companies to temporarily close offices or implement remote work policies. For example, Bank of America closed its Tel Aviv office, while Citigroup and JP Morgan Chase instructed employees to work remotely.

The prevalence of gray swan events in the MEA region has noticeably risen and become more common, leading to the increased likelihood of unforeseen events. As a result, organizations need to find innovative solutions to maintain stable operations in the MEA’s complex geopolitical landscape.

Considering this challenging situation, a compelling hypothesis emerges: Egypt could be a viable alternative for organizations seeking stability. Owning to its neutral stance in the conflict, Egypt has remained stable with no reported service delivery disruptions or harassment of foreign nationals or tourists. To navigate this complex landscape, Egypt must balance its domestic politics – the geopolitical game of thrones – while pursuing economic growth.

From a global services perspective, Egypt offers several advantages. It has become a key player in the MEA region, attracting various organizations from diverse sectors. Egypt’s service delivery value proposition includes a large, educated, and multilingual workforce of approximately 250,000 full-time equivalents (FTEs), capable of supporting over 20 languages in both voice and non-voice business process services (BPS).

In the relatively less mature MEA region, Egypt stands out as a global services delivery hub, hosting global enterprises and providers offering diverse services, including customer experience management (CXM). Egypt is also expanding its services into IT and technology solutions, exemplified by Luxoft opening a center in New Cairo in the third quarter of 2023.

Additionally, Egypt can serve as a strategic satellite hub for companies seeking to diversify from potentially risky locations in the MEA region. This is primarily due to sharing the same time zone with Israel, which facilitates collaboration.

Moreover, Egypt is experiencing growing demand for BPO talent, surpassing other prominent offshore/nearshore locations, as illustrated below, which demonstrates its increasing delivery capabilities.


Learn more about Everest Group’s artificial intelligence (AI)-powered insights platform, Talent Genius.

The complications with Egypt

At the same time, Egypt possesses its share of economic and political challenges. The country has been confronting multiple macroeconomic obstacles as the economy recovers from the double whammy of reduced tourism due to COVID-19 (impacting a massive income source for the country) and the global uncertainties exacerbated by the Russia-Ukraine conflict.

In 2022, the Egyptian Pound lost approximately 50% of its value and remained one of the worst-performing currencies in the first half of 2023 due to a lack of foreign reserves. It is expected to further depreciate by the end of 2023, putting pressure on policymakers to devalue it even more.

Other economic indicators paint a grim picture, with urban consumer inflation reaching 38% in September 2023. Egypt’s high debt-to-GDP ratio led Moody’s to downgrade its government bonds to the substantial risk Caa1 bracket, seven rungs into junk territory in October. The International Monetary Fund (IMF) has imposed stringent terms for Egypt to address the economic crisis, including selling state assets and further currency devaluation.

This presents a challenge for Egyptian policymakers, as upcoming year-end elections may make currency devaluation and asset sales unpopular with the public, even though Abdel Fattah El-Sisi is predicted to secure a third term as president.

Ally-shoring – a prudent choice during uncertain times

Against the backdrop of these economic woes, global geopolitics have been marked by black swan events since 2020. These include the Hong Kong national security law, the COVID-19 pandemic, the Russia-Ukraine conflict, and the ongoing Israel-Hamas tensions in the MEA region.

This has made the already complex MEA region more challenging to navigate. Ongoing conflicts in countries like Syria and Yemen and the Israel-Hamas dispute further complicate matters. As a result, the much-anticipated Israel and Kingdom of Saudi Arabia peace deal is on hold, and the United States’ detente with Iran, particularly regarding oil supplies, faces threats that could impact the global economy.

In response to these uncertainties, organizations are turning to “ally-shoring” as a strategy. Ally-shoring involves establishing delivery centers in allied nations to build lasting relationships that protect both economic and national security interests. U.S. companies have increasingly embraced this approach, with Mexico in Latin America and Portugal and Spain in Europe becoming popular choices. The Ukraine conflict and trade tensions with China have partly contributed to this shift.

The situation could potentially result in a higher penetration of US-headquartered companies in Egypt in the near and medium term. Let’s explore the reasons for this possible trend:

  • First, a longstanding military alliance exists between the U.S. and Egypt, facilitating the smooth movement of US military assets via the Suez Canal
  • Second, shared concerns about Iran’s regional influence and its support for proxy terrorist groups contribute to this choice
  • Third, Egypt’s limited likelihood of actively participating in conflicts, given its struggling economy and dependence on Western economic aid, positions it as a stable option
  • Lastly, Egypt’s proactive efforts to attract companies, particularly in the IT sector, as part of its 2030 vision, have led to impressive growth, with a 16.7% increase in 2021/2022 and a 5% contribution to GDP, despite global economic challenges. These growth indicators are driven by digital infrastructure investments and improved business conditions, making Egypt attractive for companies looking to establish centers in the region

In the near future, Egypt’s business environment appears stable, although concerns persist related to its neutral stance in ongoing conflicts, potential refugee issues, and economic challenges. Nevertheless, the overall risk to business operations remains low. Pro-Palestine protests in Egyptian cities have been peaceful and have not disrupted daily activities. Egypt’s role as a mediator between the West and the Arab world through the Rafah border is noteworthy, but its likelihood of becoming a major player in conflicts remains low.

The outlook

Egypt’s alignment with US interests and its neutral stance in conflicts make it an attractive ally-shoring option. However, businesses should be mindful of Egypt’s economic challenges, including a depreciating currency and high inflation, exacerbated by political pressures due to upcoming elections. Despite these threats, Egypt offers a strategic advantage, supported by a growing global services sector and government initiatives for business development in these uncertain times.

Everest Group’s dedicated team of analysts tracks 30-plus cities in India and more than 300 cities globally from a global services perspective. If you have questions or would like to discuss global services destination topics, please reach out to [email protected] or [email protected].

Contact us to learn more about popular global services locations.


Key Global Services Trends Shaping 2022

Key Global Services Trends Shaping 2022 | On-demand Webinar

The global services industry has found its stride coming out of 2021, showing transformational growth and ceaseless resilience with no sign of slowing down.

In this webinar, our experts break down key global services market developments and explore trends in outsourcing and the global in-house market. The speakers also report insights on talent, location activity, service provider M&A activity, and the key trends likely to shape the global services industry in 2022.

During this session, attendees learn:

  • How the global services market performed and key developments in outsourcing in 2021
  • Insights on the growth of the GBS market
  • The evolution of the delivery center location strategy
  • Expectations for 2022 and how to continue to prepare
  • Key factors for success for this year

Who should attend?

  • Market Vista Members
  • CEOs and CXOs
  • Global sourcing mangers
  • Vendor managers
  • Buyers and providers of services
  • Locations portfolio strategy professionals
  • Leaders of workforce strategy

Our Experts

IAOP GOV20: Rethinking Governance | October 7-9, 2020 | Virtual Event

Everest Group’s Amy Fong and Michel Janssen will be speaking in the session Managing the Transition to a Work from Home Model in Global Services in IAOP’s GOV20 virtual forum.

Leading service providers have announced a significant portion of their roles will shift to a work from home (WFH) model. While many organizations allowed WFH as a temporary solution during the crisis, its likely it will become the norm for many roles. In this session Everest Group will share the latest research on market trends as well as guidance to prepare for the “Next Normal” in service delivery.  We will discuss:

  • How prevalent will WFH become in the post COVID-19 world?
  • Which roles are most appropriate for WFH? Where is the risk too high?
  • What are the greatest concerns with wide scale WFH?
  • Which contract terms should be re-examined when negotiating a long term WFH model?
  • What questions should you ask your service providers to ensure strong governance and risk mitigation?


Thursday, October 7-9, 2020; 1:30 PM – 2:00 PM ET


Live, virtual event


Michel Janssen
Chief Research Officer

Amy Fong
Vice President


Managing Risk in Services Sourcing | Virtual Roundtable

90-minute virtual roundtable on Wednesday, June 10, 2020, 11:00 a.m. – 12:30 p.m. ET

Request to Attend

The COVID-19 crisis has forced organizations to reevaluate risks across locations and the supply base. Do you know where to start?

In this interactive session, we will discuss common risks in services sourcing across locations and service providers. We will cover tactics to measure and mitigate risk. Topics will include changes in approach to risk management during the COVID-19 pandemic.

Who should attend

Global services, procurement, VMO and outsourcing executives of enterprises wishing to learn more about locations and service provider risk management in services sourcing.

What will you learn

This session will help participants consider options to broaden their monitoring and mitigation activities related to location and service provider risk, and share experiences to date.

Virtual roundtable hosts

Amy Fong

Vice President

Sakshi Garg

Vice President

Virtual roundtable guidelines

While there is no charge for these sessions, the price of admission is participation. These sessions are most successful when all attendees are prepared to share their experiences with colleagues at other enterprises.

In support of this objective, participation is limited to senior executives within enterprises (no service providers), and each attendance request must be approved by Everest Group to ensure an appropriate size and mix of participants. The 90-minute session includes introductions, a short presentation, and 60 minutes of facilitated discussion.

Request to Attend

Top Concerns in Talent Management for Shared Services: Lessons to Future-Proof Your Workforce | Webinar

60-minute webinar held on Tuesday, February 4, 2020 | 9 a.m. CST, 10 a.m. EST, 3 p.m. GMT, 8:30 p.m. IST

Download the Presentation

Changing expectations for how Global Business Centers deliver value and innovation, combined with the increasing adoption of intelligent automation technologies, are dramatically impacting the talent equation across shared services and outsourcing activities.

To address these challenges, this session will provide you with actionable insights on related topics, including:

  • Workforce planning for the future
  • Talent scarcity challenges and options
  • Getting more from the existing workforce

We will answer the following questions:

  • Why and how are talent needs evolving?
  • What are the options to address future talent needs?
  • How do you balance the talent demand-supply dynamics?
  • What are best-in-class organizations doing to cultivate a future-ready workforce?

Who should attend and why?
This webinar will provide leaders of Shared Services, Global In-house, and Global Business Centers with critical insight around current vs. future talent needs, how best to navigate shortages in skilled talent, and key takeaways from best-in-class talent management practices.

Can’t join us live? Register anyway!
All registrants will receive an email (typically within 1-2 business days of the live delivery) containing the link to session slides and on-demand playback. In addition, we’ll also provide details on how to take advantage of a special offer to be made during the live delivery.

Eric Simonson
Managing Partner
Everest Group

Rohitashwa Aggarwal
Practice Director
Everest Group

Middle East and Africa: An Emerging Frontier for Global Services | Blog

Numerous locations in the Middle East and Africa (MEA) are emerging as upcoming destinations for global services delivery. Several multinational companies have set up their centers in the MEA region to deliver services to Europe and North America, and tech giants including Apple, Facebook, Google, Microsoft, and Uber are leveraging it for global services delivery.

What’s the appeal?

Availability and quality of talent pool

There’s been a consistent increase in the pool of entry-level talent and experienced professionals with domain-specific skills. Egypt is the leader in the region; due to various government measures to improve education quality and a significant rise in contact center operations in multiple languages, including English, French, and Arabic, the country posted an enormous 35 percent increase in the headcount for global services exports in 2018.

There’s also been a considerable rise in R&D centers and Centers of Excellence (COEs), where talented professionals with relevant and often advanced technological skill sets work to develop state-of-the-art solutions.

Less competition for talent

Because there’s a relatively large population base, limited jobs, and high unemployment rates throughout much of the region – for example, South Africa is at 27 percent and Nigeria is at 23 percent – organizations can procure talent easily and train the workers as per their specific business needs.

Cost arbitrage

Some of the countries in the MEA region offer highly attractive cost arbitrage compared to source geographies. For example, Egypt, Nigeria, and Kenya come in at 70-80 percent less (although Nigeria and Kenya are primarily leveraged to serve domestic markets), and South Africa (for non-voice F&A) and Morocco (for voice-based services) offer cost savings of 40-60 percent over source geographies.

Proximity to Europe

Proximity with various European countries is a big selling point of many African locations. For example, because Morocco offers both cultural and geographical proximity to France and Spain, companies are increasingly leveraging it for French and Spanish voice-based business process services. Because the English language was introduced by British colonists, and because there’s shared cultural affinity, South Africa is becoming a popular destination for voice-based services delivery for U.K. companies. Additionally, because most African countries share similar time zones with Europe, delivery and client teams are able to collaborate in real time, thereby, optimizing work in both the geographies.

The leading locations in the MEA region

The map below highlights key locations leveraged by global enterprises and service providers for global services delivery. While the emerging locations house 20,000 to 100,000 FTEs across global services, nascent locations employ less than 20,000 FTEs in this space.



A snapshot view of the top five global services delivery locations in MEA

  • Egypt: Offers the most attractive cost-talent proposition, with strong multilingual skills, especially in English, French, and Arabic languages. However, relatively higher operating environment risk with concerns around high inflation rates and repressive government policies
  • Morocco: Primarily leveraged for French and Arabic language voice-based BPS and IT services. Morocco offers moderate-high competitive intensity and strong government support (especially for the IT-BPS sector through financial, tax, and customs advantages)
  • South Africa: Characterized with large, high-quality talent pools and the highest maturity across functions, South Africa houses multiple organizations delivering voice and non-voice BPS, including complex processes. It has a stable geopolitical environment, well-developed infrastructure, high ease of doing business, strong government incentives for the IT-BPS sector, and limited safety and security concerns
  • Mauritius: It is leveraged for IT (both ADM and infrastructure), non-voice business process services, and R&D services to serve French and Canadian markets. It offers a favorable business environment, with government incentives for the IT-BPS sector, such as tax-free dividends and foreign tax credits
  • Israel: Leveraged for delivery of advanced IT (including IoT, ML, and AI) and R&D services, primarily to support the U.S. and Europe. Israel offers a highly favorable business environment with lower tax rates and conducive government incentives, such as low corporate tax and grants up to 20 percent of the amount of the investment.

For a detailed view of each of these locations, please read our latest Location Spotlight reports. Each report analyzes the individual country’s global sourcing profile, key opportunities, drivers, challenges, talent and skills availability, financial attractiveness, and environment risks.


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