Firm-Level Technological Capabilities In The Egyptian Machinery And Equipment Industry
Firm-level Technological Capabilities (FTC) are disaggregated into three main components, namely: technology investment capabilities, production capabilities and linkages capabilities. Based on empirical data from a sample of firms in the Egyptian Machinery and Equipment (M&E) industry, the study has found that most firms have low to moderate level of technological capabilities, while few enjoy relatively higher levels. FTC index in M&E industry is affected by both firm size and exports in international markets. M&E firms are currently able to adapt new technologies to local market requirements and to do creative reverse engineering producing middle-tech products as well as some high-tech products. However, they lack the transfer to intensive innovations and they also lack Research and Development (R&D) finance and highly skilled labor. This sector also suffers from high preferences towards imported technology in addition to a weak industrial base regarding feeding industries. Policies recommended to enhance FTC in the Egyptian M&E industry are; diversifying export markets, developing linkages with innovation systems, increasing investments in feeding industries as well as supporting R&D projects with recipient industries.