Home / Africa/International / Egypt crisis: Internet, telecom shut-down cost $90 million

Egypt crisis: Internet, telecom shut-down cost $90 million

Share this with more people!

Preliminary figures from the Organisation for Economic Co-operation and Development (OECD) suggest that the five-day shut-down of internet access in Egypt resulted in direct costs of at least US$90 million.

A statement from OECD said the amount referred to lost revenues due to blocked telecommunications and Internet services, which account for around US$18 million per day, or, on a yearly scale, for roughly 3-4% of the GDP of that country.

The statement said amount did not include the secondary economic impacts, which resulted from a loss of business in other sectors affected by the shutdown of communication services like e-commerce, tourism and call centre services.

“In fact, the IT services and outsourcing sector in Egypt has been a growing part of the economy and relies heavily on the Internet and communications networks,” it said, adding that IT outsourcing firms in Egypt made US$1 billion in revenues in 2010 (or around US$3 million per working day), servicing overseas customers through call centres, helpdesks, and other.

It noted that the shutdown may also impact negatively on foreign direct investment in the ICT sector and industries that rely on stable communications and the Internet.

The statement said Egypt’s vibrant tourism sector depends heavily on internet and communications connectivity so that is another sector that incurred heavy losses.

“It is difficult to put a number to the loss of tourism due to the Internet shutdown alone, but it provides an idea of how much the Internet has become part of mainstream economic activities, even in Egypt,” it said.

It however noted that the longer-term impact of the Internet and communications shutdown on Egypt’s economy is hard to assess.

Meanwhile the OECD is currently engaging in a country review of ICT policies that had put Egypt on a path of developing towards an information economy, as Egypt is a signatory to the OECD’s 2008 Seoul Declaration for the Future of the Internet.

By Samuel Dowuona

Egypt crisis: Internet, telecom shut-down cost $90 million
Preliminary figures from the Organisation for Economic Co-operation and Development (OECD) suggest that the five-day shut-down of internet access in Egypt resulted in direct costs of at least US$90 million.
A statement from OECD said the amount referred to lost revenues due to blocked telecommunications and Internet services, which account for around US$18 million per day, or, on a yearly scale, for roughly 3-4% of the GDP of that country.
The statement said amount did not include the secondary economic impacts, which resulted from a loss of business in other sectors affected by the shutdown of communication services like e-commerce, tourism and call centre services.
“In fact, the IT services and outsourcing sector in Egypt has been a growing part of the economy and relies heavily on the Internet and communications networks,” it said, adding that IT outsourcing firms in Egypt made US$1 billion in revenues in 2010 (or around US$3 million per working day), servicing overseas customers through call centres, helpdesks, and other.
It noted that the shutdown may also impact negatively on foreign direct investment in the ICT sector and industries that rely on stable communications and the Internet.
The statement said Egypt’s vibrant tourism sector depends heavily on internet and communications connectivity so that is another sector that incurred heavy losses.
“It is difficult to put a number to the loss of tourism due to the Internet shutdown alone, but it provides an idea of how much the Internet has become part of mainstream economic activities, even in Egypt,” it said.
It however noted that the longer-term impact of the Internet and communications shutdown on Egypt’s economy is hard to assess.
Meanwhile the OECD is currently engaging in a country review of ICT policies that had put Egypt on a path of developing towards an information economy, as Egypt is a signatory to the OECD’s 2008 Seoul Declaration for the Future of the Internet.
By Samuel Dowuona

Share this with more people!

Check Also

AfCFTA records significant progress – Wamkele Mene 

The African Continental Free Trade Area (AfCFTA) agreement has made significant progress in the last …