Egypt: Phone prices rise amid global pressure on memory chips

- The mobile phone market in Egypt is witnessing a new wave of rising prices, amid the rising cost of hardware components, shipping costs, and the exchange rate of the dollar, in conjunction with pressures being witnessed in the memory chip market globally as a result of increased demand, especially related to artificial intelligence applications and technologies. These pressures come at a time when Egypt is expanding the manufacture of mobile phones locally, as the market currently includes about 15 brands that manufacture mobile phones and accessories in Egypt, and local production reached about 10 million devices during 2025, with a target to exceed 15 million devices by the end of 2026, with a local component of 40%, in addition to expanding exports and increasing the local added value, according to official data.

Despite the growth of local manufacturing, the industry still depends on importing a number of basic components, which makes phone prices in the Egyptian market largely linked to changes in global component prices, shipping costs, and the exchange rate. The global memory chips market is witnessing pressures related to the high demand for memory components used in artificial intelligence applications, data centers, and servers, and with the increase in the needs of these sectors, part of the production capacity is directed to meeting the demand for them, which puts pressure on the supplies of some types of memory used in consumer electronic devices, including mobile phones.

The pressure is not limited to phones, as memory and storage chips are included in a wide range of devices, servers, and data center equipment, while the high global demand for them leads to increased competition for supply and an increase in the cost of some components. A member of the Board of Directors of the Giza Chamber of Commerce and Head of the Communications and Mobile Division, Mohamed Hedaya Al-Haddad, said that the Division is heading to address phone manufacturers in Egypt to hold an urgent meeting to discuss the repeated price increases, identify their causes and the possibility of reducing them.

Al-Haddad explained that the information reaching the division indicates an increase in the prices of memory components, especially RAM and DRAM, as a result of the unprecedented demand associated with artificial intelligence applications and technologies, in addition to the impact of shipping costs and the exchange rate. Al-Haddad said in exclusive statements to Ofek News in Arabic that the price increase is not limited to a specific category of phones, but rather includes various categories, but he refused to specify a percentage of the increase, indicating that determining an accurate percentage requires direct data from the manufacturers, in light of the sensitivity of the current situation.

He pointed out that local manufacturing of phones does not mean manufacturing all the device components inside Egypt, as some basic components, including electronic boards, are still imported from abroad, while the percentage of locally manufactured components in some phones reaches about 40% or 45%. Al-Haddad said that the upcoming meeting with manufacturers also aims to discuss the reasons for not hedging more against rising component prices or increasing quantities, in light of the continued pressure on the components market globally, indicating that the division will also discuss with consumer finance companies the reasons for some companies’ delay in paying merchants’ dues, despite collecting installments from customers, to discuss ways to address this problem.

He added that Egypt has become a large and promising market for the phone industry, especially with the expansion of investments and local manufacturing, especially since the goal of localizing the industry is not limited to meeting the needs of the local market, but rather extends to exporting to African markets, and providing foreign exchange resources and job opportunities. Al-Haddad pointed out that merchants are facing increasing pressure due to the change in phone buy-back prices, explaining that the merchant may sell the device with a limited profit margin, and then its price rises with the manufacturer, forcing him to pump additional money to buy the same quantity again, which leads to the erosion of working capital.

He explained that the lack of supply represents an additional factor in the market, as some companies do not have sufficient production quantities in conjunction with the rise in prices, which puts pressure on sales. As prices continue to change, the consumer may find that the price of the phone has risen before he is able to collect the amount necessary to purchase it, which leads to postponing the purchase decision. For his part, Head of the Mobile Division at the Cairo Chamber of Commerce, Mohamed Talaat, said that phone prices in Egypt have risen by about 50% to 55% since the beginning of the year compared to last year, indicating that the increases are repeated every period between 10 and 15 days, and are mainly linked to the rise in the prices of phone components, most notably the memory and storage components, RAM and ROM.

The prices of these components are affected by the increasing global demand, especially with the expansion of the use of artificial intelligence and the increased needs of data centers and servers for memory and storage chips, which puts pressure on the availability of some components and raises the cost of obtaining them globally. Talaat said in special statements to Ofek News in Arabic that memory and storage components are not manufactured in Egypt, but are imported from abroad, explaining that about 45% to 50% of phone components are manufactured or assembled locally, while the remaining part comes from abroad, as the rise in global component prices affects the cost of production, in addition to shipping costs and the exchange rate of the dollar, and thus the change in the cost of inputs affects the price of the device to the consumer.

He pointed out that phones that are assembled locally benefit from not imposing customs on the components used in the assembly process, while the cost of fully imported phones becomes higher. He estimated the customs on imported phones at about 38.5%, pointing out that there is a gap between supply and demand in some phone components, with the limited availability of some components, which affects the volume of production and the quantities available in the market. He said that these developments were reflected in sales, which declined by about 20%, explaining that consumers have become more inclined to repair the phones they have instead of purchasing new devices, after purchasing an additional phone for a family member was more common.