The Resilient Rise of the Egyptian Packaging Sector in Challenging Times

Ranked as the third largest market in the Middle East and North Africa, the Egyptian printing and packaging sector comprises over 8,000 companies and 1.5 million employees, serving a wide range of industries including food and beverages (F&B), pharmaceuticals, cosmetics and all fast-moving consumer goods.

The main reasons for the robustness of this sector are the considerable size of its local consumer market and its geographical proximity to several African and European markets, according to Eng. Nadim Elias, Chairman of the Export Council for Printing, Packaging, and Paper and President of the Chamber of Printing and Packaging Industries. What gives the Egyptian market a global competitive edge are its affordable labour and overall production costs, innovative production methods, and the high quality of its products, enabling it to meet client requirements worldwide.

According to chamber studies, packaging accounts for 7 to 10 per cent of the total cost of goods sold (COGS). Given the challenges facing the Egyptian economy, many Egyptian companies are taking proactive measures. Some have successfully embraced self-sufficiency, producing their own packaging materials, including liners, fluting papers, duplex boards, printable containers, and protective overwraps for shipping. Additionally, other companies have invested in sustainable alternatives, such as biodegradable plastics, boxes, and plates from sugarcane bagasse.

According to Eng. Elias “The Export Council (for Printing, Packaging, Paper, Literary and Artistic Works) is working on a strategy to overcome market challenges.”

According to Sara Ibrahim, Executive Director of the Egyptian Export Council for Printing, Packaging, Paper, Literary and Artistic Works, the Council has been collaborating with its long-term strategic partner Messe Dusseldorf to organize the processing and packaging trade fair pacprocess Middle East Africa (MEA).

Every year in Egypt, the exhibition brings together local and international industry stakeholders to showcase state-of-the-art technologies and reveal regional market opportunities, contributing to the forging of lucrative regional and global partnerships.

The upcoming pacprocess MEA is to take place between December 12th and 14th 2023.

The Export Council has also been collaborating with the German Agency for International Cooperation (GIZ) and the United Nations Industrial Development Organization (UNIDO) to support local production of sustainable and biodegradable packaging.

Another avenue for German-Egyptian collaboration has been Ezdehar, a program that aims at accelerating the growth of Egyptian Small and Medium Enterprises (SMEs) across different industrial sectors and enhancing their opportunities in international markets. Ezdehar is part of Private Sector Development and Innovation (PSI, 2021-2024), a development project commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ) and executed by the Egyptian Ministry of Trade and Industry (MTI), involving a number of local stakeholders.

In its second cycle (2022), 34 different companies from the local printing and packaging sector were provided with various forms of support through a specialized group of consultants in the sector. The areas of support included marketing and business development, innovation management and technology transfer, targeting new markets for export, managing assets and funds, along with human resources training.

In its effort to encourage innovation amongst SMEs in the local printing and packaging industry, the Egyptian Export Council for Printing, Packaging, Paper, Literary and Artistic Works has launched its Industrial Innovation Awards for the first time. “Packaging is an innovative service by nature,” notes Ibrahim. “It is the silent seller of the product.”

Under the patronage of the MTI and the Ministry of International Cooperation, the awards aim to motivate local companies to invest in Research & Development (R&D) and develop cutting-edge sustainable technical and business practices, as well as to help promote Egyptian products on a larger scale.  

Despite current challenges, Prof. George Noubar, Dean of the Faculty of Design and Creative Arts at Al-Ahram Canadian University, is confident in the packaging sector’s ability to persevere. In addition to growing local demand, a substantial factor contributing to the industry’s growth is high market competitiveness in the F&B industry, which pushes packaging companies to constantly enhance their products.

“Packaging does not just protect. It communicates and interacts with customers, promotes and markets goods, and extends product lifespan,” says Prof. Noubar. There are three key pathways to innovation in packaging design: graphic design, structural design, and functional design, which takes into account customer experience of unboxing, using, and reusing.

In Noubar’s view, a significant opportunity that lies ahead for the packaging sector is smart packaging. New packaging technologies, such as smart labels, QR codes, Radio-Frequency Identification (RFID) tags, and Near-Field Communication (NFC) chips integrate authorization and connectivity into product packaging, turning packages into digital tools. These tools can be used to interact with the environment and monitor the product’s condition, track and trace it through the supply chain, and provide practical information to customers.

Smart packaging can prove immensely useful for the medical, cosmetic, and F&B industries. Especially for fruits and vegetables, smart packages may use special inks and coatings to preserve fresh produce, slow microbial growth rates, and preserve or reduce moisture. Nevertheless, there is a need for investing in R&D to reduce production costs associated with smart packaging in order to make it more attractive for local industrial adoption.

With a growing consumer base, a burgeoning business atmosphere, and strong regional and international cooperation, the Egyptian packaging industry is certainly capable of overcoming current market challenges and exploring new frontiers to packaging technologies that fulfil the needs of the future – whether in terms of safety, innovation, or information.