The rationale is sound, but it misses a critical element: most of these brands are limited to final assembly, not full manufacturing. Key components, including screens, processors, batteries and chip, are still imported and priced in foreign currency. As a result, even locally assembled devices remain exposed to exchange-rate volatility, import costs, and customs procedures, keeping retail prices high.

“Regulation is not the biggest challenge — the government is keen to fund and support any new vision that is coming in, to support the local industry,” says Seif Bahgat, an investment and business development consultant based in Cairo. “The issue is capital constraints.”

He argues that the bigger obstacle is investor appetite. “Venture capital is not open-minded enough to go into hardware. It’s a long-run, long-shot investment – and most funds don’t have the appetite for that kind of risk,” adds Bahgat, who is also an advisor at Lantern Ventures Egypt. “You need investors who are willing to take losses for a while, until you get consumer acceptance and can think long term.”

Some local startups have found ways to make it work. Cardoo, for example, has built a following by assembling smartwatches, headphones, and accessories in Egypt, offering lower prices and better availability. But their story also shows how tough it is to build a hardware brand from scratch. It takes steady investment and a lot of time to win over customers.

“It’s not easy to just open a manufacturer [manufacturing company] and be profitable,” Bahgat adds. “It takes years and years to become a serious consumer player – especially in Egypt, which has a deeply consumption-driven market, where purchasing decisions skew towards affordability, feature density and brand visibility.”

Egypt’s smartphone market, dominated by global tech giants, has made many entrepreneurs sceptical about building hardware locally. Mahmoud Omar, who runs the edtech startup Read to Lead and provides growth consulting to companies, says that as a result, “Egyptian startups move towards integration, services and distribution,” with most success coming from software or services built on top of existing platforms – not technology developed “from scratch”.

The Cost of a Workaround

Ezz’s father used to live in Saudi Arabia, where he would buy cheaper phones for his daughters, including her. She tried to postpone upgrading for as long as she could, until her phone’s battery deteriorated completely. In the end, she had no choice but to replace it, absorbing the tax-driven price increase—a cost that, in her case, amounted to nearly four months’ salary.

Mai Farouk, 29, says she does not even want to imagine how many paycheques it would take her to buy a new phone. “For now, it still works, and I don’t think I’ll replace it unless something breaks,” she says. “Buying a phone has become just too expensive.”

Omar, who focuses on making tech education accessible, says the impact of these rules goes far beyond just price. It affects the whole digital ecosystem in Egypt.

“If mobile phones become harder to access and more expensive, this will directly affect digital-skills learning, youth readiness for work, and the number of people who can enter the startup world in the first place,” he says.

The First Computer

For many Egyptians, Omar argues, the smartphone isn’t just a device — it’s the default gateway to the internet, education and opportunity. “The mobile phone is the first computer for most people, and when you block it, you are literally blocking the starting line.”

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