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Egypt – Strategic Hub for MENA and Global Subsea Cable Routes
Egypt is a critical market for enterprises targeting the Middle East, North Africa (MENA), and Southern Europe. Its unique geographical position as a crossroads for major subsea cable systems offers exceptional international connectivity, making it a primary location for content delivery networks, cloud service providers, and businesses requiring low-latency access to multiple continents.
Egypt: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Strong international links via numerous subsea cables; terrestrial connectivity is developing. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Access is via network extension from European hubs like Marseille or Milan. |
| Power Cost | Unclear | The grid is dominated by natural gas, with growing hydro and renewable sources. |
| Disaster Risk | Moderate (4.3/10) – as of September 2025 | Primary risks are flood and seismic activity, requiring careful site selection. |
| Tax Incentives | No | Egypt does not currently offer specific tax incentives for data center development. |
| Sales Tax | 14% VAT – as of September 2025 | A standard Value Added Tax applies to services. |
Network & Connectivity Ecosystem
Carrier Density & Carrier Neutrality: As a major convergence point for subsea cables connecting Europe, Asia, and Africa, Egypt has a significant international carrier presence. While carrier-neutral facilities exist, the ecosystem is still maturing compared to primary European hubs. The market contains over 15 providers as of September 2025.
Direct Cloud On-Ramps: There are no public cloud on-ramps located directly in Egypt as of September 2025. Businesses connect to major cloud providers like AWS, Google Cloud, and Microsoft Azure through private network extensions to European hubs such as Marseille, Athens, or Milan.
Internet Exchange Points (IXPs): The primary public internet exchange is the Cairo Internet Exchange (CAIX), which facilitates local traffic peering. However, a substantial volume of peering occurs privately between major carriers and content providers within key data centers.
Bare Metal: Bare metal server options are available, offering dedicated compute resources for performance-sensitive applications. Providers like Hivelocity and phoenixNAP can service the region from nearby European locations, providing a path for deploying physical infrastructure.
Power Analysis
Average Cost Of Power: Industrial electricity pricing is not publicly standardized, as of September 2025. The national energy mix is approximately 85% fossil fuels (primarily natural gas), 10% hydropower, and 5% renewables like solar and wind. This composition provides a stable but carbon-intensive power supply.
Power Grid Reliability: The national power grid is generally reliable in major metropolitan areas where data centers are located, such as Cairo. Facilities typically feature redundant connections to the grid and robust on-site backup power generation to ensure uptime.
Market Access, Business & Tax Climate
Proximity To Key Business Districts: Data centers in Egypt are concentrated around Cairo, providing low-latency connectivity to the country's primary commercial, financial, and governmental centers. This proximity is ideal for financial services, telecommunications, and media companies.
Regional Market Reach: Egypt serves as a digital gateway to a population of over 110 million people domestically and acts as a strategic hub for serving markets across North Africa and the Middle East. Its central location minimizes latency to hundreds of millions of users in the surrounding regions.
Tax Advantage For Data Centers: Egypt does not offer specific tax incentives or holidays for data center investment or operations. The standard corporate tax and VAT rates apply, which can present challenges compared to other markets with targeted investment programs.
Natural Disaster Risk
Egypt has a moderate overall disaster risk profile, with an INFORM Risk score of 4.3 out of 10 as of September 2025. The primary natural hazards are driven by geography and climate, requiring diligence in infrastructure planning and site selection.
Key risks include:
- River Flood: High risk (9.9/10), particularly along the Nile River delta and floodplain.
- Coastal Flood: High risk (9/10) along the Mediterranean and Red Sea coastlines.
- Tsunami: Moderate risk (5.9/10) for coastal assets.
- Earthquake: Moderate risk (4.6/10), stemming from regional fault lines.
- Drought: Low risk (2.2/10), though water scarcity remains a long-term strategic challenge.
