The government will stop collecting the 5% resource development fee on mobile phones sold in the local market by factories operating in economic zones and special investment zones, in exchange for pledges to inject new investments and raise production capacity, according to what three government officials who were not named told the Enterprise newsletter on Thursday 5 November 2026.
These factories used to pay the fee on their local sales because the products of those zones are treated as imported goods for customs purposes, while devices made inside the customs territory are exempt from it. The fee is imposed under Law No. 147 of 1984, with an exemption for components imported for manufacturing purposes and for the final locally made device. The officials said the cancellation means forgoing part of revenue estimated at about 1.9 billion pounds (35 million dollars) in the current fiscal year’s budget, and comes in parallel with including the mobile phone sector in the export rebate program.
Fifteen global brands make their phones in Egyptian factories, with total output of nearly 10.5 million devices, according to a source in the telecoms sector. The government aims to produce between 14 and 15 million devices this year, compared with about 10 million devices in 2025 and about 3 million in 2024, according to earlier statements by the Minister of Communications and Information Technology, while declared production capacity stands at about 20 million devices a year, and total investment in the sector at about 200 million dollars.
The exemption comes after sales of locally made phones fell by about 20% this year amid rising prices and weak spending, according to the head of the communications and mobile division at the Federation of Egyptian Chambers of Commerce, Mohamed Talaat, despite imports of phone production inputs rising 37.1% to about 500 million dollars in the first half of the year, according to foreign trade data.
Photo: Skitterphoto via Wikimedia Commons (CC0)
