The information technology firm, Raya Holding Company, and Citibank Egypt have signed a contract to set up a joint venture for electronic business services in Egypt and the region, Egyptian newspapers report.
Medhat Khalil, chairman and chief executive of Raya, said the new joint venture, called Ciranet, is the first to provide web-based business-to-business services in Egypt and to advise companies on how to conduct deals on the Internet.
Communication and information minister, Ahmed Nazif, said the venture is "true value-added to our economy". He added that it is a step further on the road to the creation of an information technology community, a core objective of the Egyptian government.
Until now, electronic commerce in Egypt has been conducted through the Internet merely by advertising products on the Net. "Today we are witnessing a further step that brings together the producer, distributor and consumer to meet on the web," the minister said.
Nazif added that this creates an opportunity for small and medium-sized producers or distributors, who do not have enough convenient outlets for their products, to launch them on the web. He said the final beneficiary is the consumer, who will be able to survey the products and the suppliers, compare them and make a selection without leaving home.
Dhiro Tanna, vice president for global transactions services at Citibank, predicted that in five years, over 80 percent of all transactions in Egypt would be online as it offers users "convenience, cost savings, and security".
As a long-term strategy, Khalil said Ciranet believes in mergers with international companies in the field of information technology. But first of all "we have to attract them to invest in Egypt, while preserving the right to management and a minimum of 50 percent ownership to guarantee that investments benefit the Egyptian economy," he said.
He added that the workforce would also be totally Egyptian, allowing for foreign experts on a temporary basis.
Managing Director of Ciranet, Sameh Montasser, said e-commerce saves about 22 percent for the producers or suppliers of products, as it reduces inventory cost and speeds up the business cycle. — (Albawaba-MEBG)