Innovating through the Arab Spring

CAIRO – If this country ever gets back to normal, it will have been in part due to people like Hassan Azzazy, a chemistry professor at the American University in Cairo.

His specialty, nanoparticles in medicine, is light-years away from the TV news images of revolution and bombs that beam from here worldwide. His lab has developed a novel method – with three US patent applications – to make an easy, cheap test for hepatitis C, a modern plague here. With partners, he raised about $200,000 from local angel investors for his start-up, D-Kimia (Arabic word-play on “this is chemistry.”) At the same time, he is teaching grad students here at this private university and running a course on bio-entrepreneurship.

“We have to innovate to deal with our challenges,” he declares. “Egypt’s only solution is entrepreneurship and innovation. My goal is to point the way, so others may follow.”

Call it a reed of hope – but it’s here in Cairo, nonetheless: In some labs, classrooms and companies, a growing number of people are developing new ideas, products and processes that could pave the way to a brighter future. Local universities are forming an association for technology transfer. The government is trying to improve technical training and research funding. A small but growing number of academic consulting firms are appearing. The volume of EU grants to Egyptian researchers is up – a three-fold increase over the past decade, to 96 projects during the 2007-13 EU grant cycle.

Horizon 2020 hits Cairo

The EU has a special interest in watering these shoots of growth – if only to avert the geopolitical threat that a strife-torn, impoverished Egypt would pose. Under its new, seven-year R&D programme, Horizon 2020, the EU is inviting international cooperation on a large scale; and neighbouring countries like Egypt can qualify for full funding alongside EU partners in most projects. Interest is intense: At a Horizon 2020 conference here on 9 February organised by the European Commission, about 500 gathered to hear about how to get the money. “International cooperation is crucial for Horizon 2020,” one EU official, Elisabeth Lipiatou, told the crowd.

But it will take a long, sustained effort; a conference and new grants are nice, but not a solution in themselves.  For one thing, most Egyptian researchers still find it too hard to network with the wider scientific world – due to travel and language barriers. Some criticise the nature of past EU-Egypt research collaborations. In one EU project, the Egyptian participant was relegated to running the Web site, not doing real research, complains Abdel Hamid El Zoheiry, former senior advisor to the Minister of Scientific Research and now president of the new Euro-Mediterranean University in Slovenia.  The rise in EU grants is great, he says; “but in terms of real participation and added value, there is still a lot of space for improvement.”

And, of course, the region’s turmoil has to end. University classes have been intermittently suspended. Enrolment and budgets have fallen at the country’s private universities, as fee-paying foreign students stay away. Some major technology projects are on hold, for lack of financing and investor confidence. The government tried raising its research budget, but didn’t get enough good-quality applicants to spend it all, Egyptian officials say.

Under-spending, over-crowding

Certainly, the challenges run deep. The government spends about 0.2 per cent of GDP on R&D – less than half the level of Cyprus, Romania or Croatia, the EU’s poorest R&D performers. Half the country’s 89 million population is under 25, massively over-crowding the country’s public universities; Cairo University, the nation’s biggest, has more than 250,000 students. The law, technology transfer specialists say, isn’t clear enough on who owns university inventions – making it difficult to attract investment. Red tape can impede research; medical researchers complain they have difficulty shipping tissue samples out of the country for testing.

But there are bright spots, too. In 2011, just after the Arab Spring revolution, US-based Intel Corp. acquired a 100-employee Egyptian software company for a rumoured $10 million. An ICT cluster, “Smart City”, was set up on the outskirts of Cairo, for local offices of Microsoft, Vodafone and other tech multinationals. A solar and wind sector has begun generating electricity, under government targets for 20 per cent renewable energy by 2020. On the way to Cairo airport, a massive new complex of universities, offices, apartments and shopping malls looks like a transplant from San Diego. That this can co-exist with overcrowded Cairo tenements, ancient pyramids and clashing cultures is among the eternal paradoxes of the country.

For the most part, Egyptian industry assembles and sells products invented elsewhere – but a new generation of manager, often trained in North America or Europe, is thinking about the future.

“The word ‘innovation’ has become a buzzword here, too, like everywhere in the world,” says Mohab Anis, an associate professor at the American University in Cairo.

Teaching innovation

Anis founded a local innovation consultancy, Innovety, affiliated with Boston-based IXL Center. It will perform an “audit” of a client’s internal systems for new products, processes or services, then recommend a strategy to improve, and finally develop business plans for specific products. The work ranges from helping local appliance-maker Fresh develop new products, to training corporate managers in innovation techniques.  

In Egypt, he says, a typical task is bringing change to an established company that grew rich on the market instincts of the founders, rather than on the data-intensive methods of modern business. Often, a son of the founder comes back from a Western university with new ideas, and wants help getting the old man to accept them. Anis’ company was founded five years ago – and then the post-Revolution turmoil slowed growth. To survive, the company innovated: Developing two-day courses in innovation management at cut-price rates under €200, to attract new clients. The strategy is simple, and now it’s working as more consulting contracts come in. 

“We’re growing, and we have a lot of potential,” he says.