Egypt’s smartphone market stabilises after regulatory crackdown

Details: Manny Pham; Category: Devices & Platforms; 21 April 2025; 7035 views

Canalys has predicted that Egypt’s smartphone market could stabilise following the enforcement of new regulations aimed at curbing its long-standing grey market, which led to a sharp drop in shipments at the start of the year.

According to the National Telecommunications Regulatory Authority (NTRA), around 80% of smartphones entering Egypt in 2023 and early 2024 were illegally imported, with buyers avoiding taxes. In response, the government introduced a whitelisting regulation in January 2025, requiring all smartphones to be registered before being connected to a mobile network. Canalys described the move as a “structural reset for the industry”.

Data from Canalys shows that smartphone shipments fell by 18% year-on-year, from 780,000 units in January 2024 to 642,000 in January 2025, following the introduction of the regulation.

Under the new rules, smartphones are now subject to a combined 38.5% in customs duties and taxes, as mandated by Egypt’s Ministry of Communications and Information Technology (MCIT) and the Ministry of Finance. The change is designed to discourage smuggling while also accelerating the development of local manufacturing.

While the shift has caused short-term disruption for consumers and vendors, Canalys noted that it is part of Egypt’s broader strategy to build a more stable and transparent smartphone market.

New assembly lines have already been established, and the government projects that local production could meet up to 80% of domestic demand. The MCIT aims to triple local output from 3 million units in 2024 to 9 million by 2026, as part of efforts to position Egypt as a regional manufacturing hub.

However, the road ahead presents challenges. Devices sold through legal channels are currently 20% to 30% more expensive than grey-market alternatives, due to higher operating costs and import duties on components.

Despite this, major vendors such as Samsung and Xiaomi have partnered with the government to launch local manufacturing operations, signalling confidence in Egypt’s long-term potential.

Canalys acknowledged that while the market reset has led to affordability concerns, the increased reliability, security, and after-sales support associated with officially imported and locally assembled devices could help the market recover and grow in the months ahead.