Chief Commercial Officer for Samsung Egypt Sherif Barakat said the parent company has great confidence in the Egyptian market despite Egypt’s economic conditions, as evidenced by the establishment of a factory for producing TVs in Beni Suef in 2011, despite the circumstances in Egypt.
Barakat believes the lack of hard currency and lack of clarity in some of the economic visions of the state regarding taxes, customs, and some other laws affect the financial return on investment for companies, which affects the decisions of foreign companies in pumping new investments.
The parent company has a positive outlook on the Egyptian market and as soon as the situation is relatively stable, there will be a new leap in pumping investments by the Korean company in Egypt. Egypt is the largest market in the Middle East in terms of sales of household appliances and mobile devices.
According to Barakat, Egypt is among the top five markets in the Middle East and North Africa for sales of Samsung. Egypt’s economy is growing; the GDP amounted to 4.5% last year, a good indicator compared to neighbouring markets. Samsung acquired 27% of the sales of televisions in the Egyptian market, making it the biggest company in terms of market share locally.
Commenting on the dollar’s crisis and how it affects the company’s performance, Barakat said the crisis has direct and indirect effects. The direct effect is limited, given that the company manufactures televisions in Egypt and exports them to more than 15 countries in Europe and the Middle East, which gives it relative stability in facing lack of dollar crisis.
He quoted the increase in home appliances’ sales, especially televisions in February as evidence for that. This increase came after the prices were discounted locally. The market’s sales growth rate in general amounted to about 75%.
As for the indirect effect, it is the difficulty of pricing the new products because of the fact that the government’s decisions are influenced by lack of dollar and unclear vision about the laws planned to be approved, such as value-added tax.
Barakat revealed contracts with 25 private centres were signed to expand in providing after-sales services, raising the number of the after-sales service centres to 80. For the future vision of Samsung, the company will pay more attention to the Internet of Things (IOT) network, especially after the parent company acquired a US specialist companies in the sensors industry. IOT services have already been launched in Europe.
Regarding the decline of Samsung’s global profit and its impact on the Egyptian market, there is no negative impact of the parent company’s profits decline on the company’s market shares in various local sectors except mobile phone sector. The mobile phone company’s shares fell slightly due to the increased number of competitors.
“Despite the decline in our shares, we are still five times larger than the nearest competitor. The smart phones sales in Egypt over the last year reached about 15m units worth between EGP 15bn to 17bn. Samsung acquires 60% of the market’s total sales during 2015,” he said.
For Samsung’s plans to support entrepreneurship, Barakat said the resumption of a programme that was launched earlier to support the business pioneers through providing training sessions to teach them how to establish an application for smart phones using Samsung labs.