Dissertation: Business Environment in Egypt and UAE Export Firms

This dissertation investigates the business environment in Egypt and its influence on UAE export firms. The study employs PESTLE and CAGE frameworks to assess the Egyptian market, exploring political, economic, social, technological, legal, and environmental factors, as well as cultural, administrative, geographic, and economic differences. The research also considers blue ocean strategies and various market entry modes, such as joint ventures and foreign direct investment. Utilizing an interpretivist research philosophy and a mixed research design, the study employs both primary and secondary data collection methods, along with statistical data analysis, to analyze the impact of the Egyptian business environment on UAE export firms. The dissertation concludes with recommendations for UAE export firms, suggesting the use of online marketing and promotion strategies to enhance their presence in the Egyptian market.

Running head: DISSERTATION
Research Topic: Business Environment in Egypt and Its Impact on UAE Export Firms

DISSERTATION 2
Executive Summary
The main aim of this dissertation is to assess the Business Environment in Egypt and Its
Impact on UAE Export Firms. This report explained that the Egyptian market can be
considered as a significant market for UAE Company with respect to exporting their products
as well as increasing their profits. It is also assessed that PESTLE analysis is used for
evaluating the business environment of the company. In addition, the CAGE framework is
used for evaluating the difference between cultural, Administrative, Geographic and
Economic. It is also evaluated that Blue ocean strategies could be used by UAE exports
firms in terms of expanding the business into the Egypt market. It is found that different
market entry mode strategies used by the company for penetrating into Egypt markets such as
joint venture and foreign direct investment. In this research, interpretivism research
philosophy is used by a researcher to conduct the investigation. Descriptive research is used
to describe information regarding research issues.
Mixed research design is used for assessing the gathered information. It would be selected as
it contains the characteristics of both qualitative and quantitative research design. Along with
this, inductive approach is used for creating the theories related to research concern. Both
primary and secondary data collection methods were used to collect the information
regarding research issues. In addition, statistical data analysis technique is used by a
researcher for assessing the information about research issues. Along with this, it can be
concluded that Business Environment of Egypt has impact on UAE Export Firms. It can be
recommended that UAE export firms can use different marketing strategies such as online
marketing and promotion strategy.

DISSERTATION 3
Table of Contents
Executive Summary...............................................................................................................................2
Introduction.........................................................................................................................................4
Business Research Background.........................................................................................................4
Identification of issues and opportunities..........................................................................................5
Research Aim and objectives.............................................................................................................6
Research questions............................................................................................................................6
Research significance........................................................................................................................7
Dissertation Structure........................................................................................................................7
Literature Review................................................................................................................................8
PESTLE of Egypt..............................................................................................................................8
CAGE frameworks..........................................................................................................................12
Scenario planning frameworks (Blue Ocean Strategy)....................................................................12
Best market entry strategy for UAE products..................................................................................13
Export barriers might face domestic firms while exporting to foreign markets...............................14
Relationship between marketing strategy and performance (ways to export and promote UAE
products and services).....................................................................................................................15
Methodology......................................................................................................................................16
Introduction.....................................................................................................................................16
Research philosophies.....................................................................................................................16
Research Approach..........................................................................................................................17
Research type..................................................................................................................................18
Research design...............................................................................................................................18
Research strategy.............................................................................................................................19
Data collection methods..................................................................................................................19
Sampling strategy............................................................................................................................21
Data analysis method.......................................................................................................................22
Research limitations........................................................................................................................23
Survey through questionnaire..........................................................................................................23
Data Analysis and Discussion.............................................................................................................28
Discussion...........................................................................................................................................35
Conclusion and Recommendations......................................................................................................39
References...........................................................................................................................................41
Appendix: Survey through questionnaire............................................................................................49

DISSERTATION 4
Introduction
Business Research Background
In the current scenario, exporting UAE products as well as entering into the emerging market
can be a great way in terms of expanding the UAE business, and increasing the sales of the
company particularly when the domestic rivalry become high. Increasing the export will
support to gain the aggregate demand and it would have a favourable effect on the declining
unemployment rate and gaining the GDP per capita. The Egyptian market can be considered
as a significant market for UAE Company with respect to exporting their products as well as
increasing their profits. It is addressed that entering into the emerging area without creating
market research for assessing the issues and opportunities could be very risky for a business
(IMF, 2019).
It is addressed that UAE is a strategic partner for Egypt that continues to involve with Egypt
in terms of make advancement of mutually shared interest in different areas such as strong
commercial links. As per the Egyptian Minister of Trade and Industry, UAE has invested in
about 6 billion USD dollars in different sector of Egypt that makes UAE biggest investor in
the nation. As per the IMF, GDP of Egypt is increased by 5.3 percent in the year of 2018 and
predicted to over 5.5 percent in the year of 2019. Along with this, Gross international
reserves were increased to USD 44.9 billion in the year of 2018 and were expected to arrive
at USD 44.9 billion in the year of 2019 (IMF, 2019).
The hydrocarbons industries are highly contributed in the growth of GDP whereas the current
identification of natural gas reserves in the mediterranean sea as well as attaining the self-
sufficiency related to natural gas has encouraged domestic as well as a foreigner for investing
purpose. Over the last 3 years, the Egyptian government has developed solid economic basis
as well as reformed the trade policies of nation in order to lead the trader as well as foreign
investors who are interested in investing into Egypt (Kahiya, 2018).

DISSERTATION 5
The government has highly fixed its local currency depreciation in against the US dollars,
low foreign reserves, high unemployment rate, constraints related to capital movement and its
debt service complexities. The government also provides backing related to international
monetary fund (IMF) through different actions like to cut down in energy subsidy, tax hikes,
as well as Egyptian pound flotation for covering the inadequacy of US dollars. The current
economic reform is done in the context of monetary and fiscal policies and it provides a
favourable outlook to the economy as well as improved the rating of an issuer to be B3
(MIIC, 2019).
Identification of issues and opportunities
Egypt’s significance in world trade has increased exponentially because of the recent
economic improvements and it has also improved the country growth and declined the
inflation rate. Egypt is the largest Arab nation with regards to a population that arrives at over
97 million in accordance with World Bank information. It makes Egypt the biggest base of
the consumer in Africa and the Middle East as well as positions it as a testing base for several
consumer products for large international companies. Hence, entering into the Egyptian
market would generate more chances for UAE companies with respect to gaining revenues
and sales (MIIC, 2019).
Exporter companies should have financial and technical competencies for developing the
exportable goods that can comply with the international nation specification as well as
standards for overcoming the internal barriers related to the company and product features. In
addition to this, exporters should overcome the external factors like exports market, industry,
as well as barriers related to the macro environment (Moody's Investors Service, 2019).
The aim of this investigation to create the awareness for entering into the Egyptian nation in
terms of supporting the UAE companies for better equipped to understanding and entry
strategies in order to increase their profits and declining their risks. This research facilitates

DISSERTATION 6
depth understanding regarding the main external barriers that could be faced by UAE
companies for aligning with their strategies (ArabianBusiness.com, 2019). Moreover, it
would focus on supports from the UAE government with respect to export promotion
strategies to overcome the barriers related to any market as well as a macro environment that
could be out of control for an exporter. It is stated that overcoming the internal barriers are
out of scope for research and further research may require to identify such barriers for each
kind of industry (African Development Bank, 2019).
Research Aim and objectives
The main aim of this research is to assess the business environment in Egypt and its impact
on UAE export firms. The following objectives would be used to complete the main aim of
this research:
RO1: To address the business environment of Egypt and its impact on UAE export
companies
RO2: To identify the market entry modes for entering into Egypt in the context of UAE
export firms
RO3: To recommend the marketing strategy to create the awareness about the Egyptian
market and increasing the profit of UAE export firms
Research questions
The following question is responded through this research study that helps to resolve research
concern:
RQ1: How business environment of Egypt has an impact on UAE export companies?
RQ2: What are the market entry modes for entering into Egypt in the context of UAE export
firms?
RQ3: Which marketing strategy can create awareness about the Egyptian market and
increasing the profit of UAE export firms?

DISSERTATION 7
Research significance
This research is beneficial for an academician to comprehend the factors affecting the
business environment of Egypt and its impact on the UAE export companies. It is also
effective for UAE export firms to understand the market entry modes for entering into Egypt.
Moreover, it is also significant for exports firms of other nations to increase the knowledge of
marketing strategy that can generate awareness regarding the Egyptian market and increasing
the profit of UAE export firms.
Dissertation Structure
In this dissertation, different chapters will be considered by researchers such as introduction,
literature review, research methodology, data analysis and findings, and conclusion and
recommendations. Under the introduction chapter, the researcher will discuss the research
background, problem statement, research aim and objectives, and research significance.
In the second chapter, the researcher would use a literature review for reviewing the views
and opinions of different authors. In this chapter, different secondary sources would be used
such as journal articles, textbooks, academic publication, and online websites (Sharpe and
Schroeder, 2016).
In the third chapter, the researcher would use research philosophies, approach, strategies, data
collection method, data analysis techniques and, conclusion and recommendations. It would
be beneficial for conducting research in a mechanical way (Hasaballah, et. al., 2019).
Under the next chapter, research would assess the gathered data and presents these data
through different pie charts, column diagram and bar diagram. It would aid to comprehend
the data in a meaningful way. In conclusion and recommendation, the researcher will
conclude whole chapters and provide recommendations accordingly (Suresh, et. al., 2018).

DISSERTATION 8
Literature Review
PESTLE of Egypt
Political factors
(Sources: The global economy, 2019).
According to Nobanee and Ellili (2016), Egypt's seems there is unstable political condition
that may affect the UAE export firms. Due to unstable condition, election entails a huge
amount of spending there. Any corporation that is likely to expand their business in Egypt
can consider printing and media as well as record the high amount of turnover during this
time.
Economic factors
(Sources: Trading economics, 2019).

DISSERTATION 9
(Sources: Trading economics, 2019).
(Sources: Trading economics, 2019).
(Sources: The global economy, 2019).
On the other side, Basco (2017) evaluated that the economic factor in Egypt may consider the
level of the unemployment rate, inflation rate, and exchange rate. It is assessed that the
unemployment rate is declining as it may negatively impact on business expansion in terms

DISSERTATION 10
of hiring the huge amount of candidates. Along with this, it could be costly for UAE firms to
recruit the applicants in an organisation.
Social factors
Gerged et al. (2018) evaluated that Egypt is a highly populated country on North Africa
continent. It has around 9.76 crores population in the year of 2017 that can be referre to as a
huge part of Africa. There are wider market opportunities. The foreign direct investment is
gaining despite the instability of a nation. The population of Egypt is sufficient for
influencing investors. Egypt has several ethnicities as well as religions. Yet, the nation still
celebrates the unity in diversity hence it is required for comprehending the religion as well as
cultural value to each group before performing business in Egypt.
Technological factors
In contrast to this, Adeola (2017) evaluated that Egyptian is high computer savvy and a large
number of youth has computer literacy in the nation. Although, computer and laptop is quire
remain luxury to some individual and the use of Smartphone may appear to overpass the gap.
An individual is vigorous internet users as well as uses social media channel through
Smartphones. It is the best technique to advertise online for UAE exports firms to conduct
business in the Egypt nation. It is the best mode for arriving at the targeted consumers.
Legal factors
(Sources: The global economy, 2019).

DISSERTATION 11
(Sources: The global economy, 2019).
Raza et al. (2018) assessed that under the legal factor, Egypt shows the declining tax system
for personal income tax. The income tax in Egypt is declining while VAT is also low. The
UAE export firms want to expand their business in Egypt is required to comply with the
feasible tax regulations. Furthermore, the company can apply the fines when it has been
found that these are not compensating appropriate taxes. Along with this, any company that
wants to start their bank account in Egypt is anticipated to provide the bank with a tax
identification number. It is required for corporations to get open the account number for
taking place the transaction.
Environmental factors
In contrast to this, Abdouli and Hammami (2017) evaluated that the federal government of
Egypt plays a vital role in keeping protect to the ecology of Egypt. Each region in this nation
is authorized for articulating the regulation that makes sure that the environment is hygienic
for averting the sicknesses as well as other external factors. The shortage of electricity, level
of pollution and noise from power is creating the high sets. This may impact on commercial,
industrial, as well as residential fields individually. The environmental factors keep on
transforming and the company is required for updating itself with the transformation taking
place within the atmosphere.

DISSERTATION 12
CAGE frameworks
Abdouli and Hammami (2017) evaluated that the CAGE distance framework addresses the
difference in different elements such as cultural, Administrative, Geographic and Economic
that UAE export firms should identify while crafting the international approaches. This may
be used for comprehending the patterns of capital, trade, information, as well as flows of
people.
Countries Cultural
distance
Administrative
distance
Geographic
distance
Economic
distance
UAE Similar culture Increasing
regulatory
pressure
associated with
rivalry
Arabian zone Emerging
markets
Egypt Diverse culture
and language
Favorable
policies
promoting
foreign direct
investment
Differences in
climates
Opportunity to
create a dense
network
Opportunity to
make strategic
majority share-
acquisition
Scenario planning frameworks (Blue Ocean Strategy)
In opposed to this, Al-Maamary et al. (2017) demonstrated that UAE export firms can use the
blue ocean strategy in Egypt market because there is very less or no competition in the
market. This strategy focuses on searching the factor for business where few firms perform
with no pricing burden. This strategy supports for creating the new demand and creates
opposition infeasible by demonstrating the goods with premium characteristics. It can also
help UAE export firms for creating huge revenues because the products can be little price
steep due to unique features. The company can easily increase the demand of customers by
using the blue ocean strategy. This strategy suggested that UAE export firms should generate
new demand in recognized market space or Blue Ocean. It supports in redesigning the firms
as well as products to deliver new value.