A number of officials involved in smart phones sales expressed expectations for price increases during the first half (H1) of 2016, driven by the Central Bank of Egypt (CBE) regulations and dollar availability.
The CBE’s regulations stipulate the securing of 100% of the value of imported goods as insurance, which constitutes a burden for importers.
Chairman and CEO of Sico Technology Mohamed Salem said the CBE’s regulations for dollar provisions pressure companies as it is difficult for local companies to secure 100% of the value of goods as insurance before shipments are delivered.
Salem said Sico manufactures smart phones and tablets in China, like other companies in the world. He noted that the CBE’s regulations will curb smartphone sales in Egypt, which will affect their prices in the upcoming months.
Amr Sheira, General Director at Polaroid Egypt specialising in smart devices manufacturing, said smartphone prices may increase slightly during H1 of 2016, driven by the CBE’s regulations. The global prices of smart devices are decreasing, which indicates an implied increase of prices in Egypt if they remain unchanged.
Sheira said the price increase will not affect sales due to the increased demand. Only 25% of phones used are considered smartphones, which indicates a potential high demand.
Link-Egypt General Manager Yehia Tharwat disagreed, saying prices will remain the same during at least H1 of 2016. He attributed the prices stability to a number of factors, such as the growing number of smartphone manufacturers abroad, especially Chinese companies that offer low-priced products. The demand on smartphones has been declining, he said.
IDC Foundation for Research and Consulting issued a report that said that 50% of phone sales in Egypt during Q3 of 2015 were for smart phones. They acquired 91% of sales during the same period, while only 9% of the sales were for basic mobile phones.