After contracting 4.9% in 2020, IT spending across the Middle East, Turkey, and Africa (META) will make a welcome return to growth this year, increasing 2.8% to $77.5 billion.
That’s according to the latest predictions revealed by International Data Corporation (IDC) as more than 1,000 senior executives from the region’s most influential technology vendors, telecommunications operators, and IT service providers gathered online last week for the first ever virtual edition of IDC Directions Middle East, Turkey & Africa.
The annual event is a firm fixture on the ICT industry calendar and this year focused on the theme of ‘Resetting for the Next Normal: Strategies for Enabling the Future Digital Enterprise’.
Opening the day’s proceedings, the firm’s group vice president and regional managing director, Jyoti Lalchandani, explained that spending on digital transformation (DX) is set to gather even more pace in the post-pandemic period, increasing from 25% of total IT spending in 2020 to 37% in 2024.
“The COVID-19 pandemic and subsequent economic fallout has accelerated digital transformation across the region, spurring unprecedented demand for contactless services, cloud solutions, and collaboration applications,” said Lalchandani.
“Most economists predict a return to economic growth this year as vaccines become more widely available, and we expect that by 2022, 70% of organizations worldwide will have increased their use of digital technologies, transforming existing business processes to drive new levels of customer engagement, employee productivity, and business resiliency.”
Lalchandani’s other predictions for the META region’s dynamic ICT markets in 2021 included the following:
- Overall ICT spending (telecom services and IT) will grow 1.9% to surpass $209.5 billion.
- Spending on public cloud services will grow 26.7% to top $3.7 billion.
- Spending on SaaS, PaaS, and IaaS will grow 24.5%, 30.6%, and 30.7%, respectively.
- Spending on professional cloud services will grow rapidly to total $1.6 billion.
- Spending on AI software will grow 23% to top $540 million.
- Spending on security (hardware, software, and services) will grow 7.1% to reach $3.3 billion.
IDC’s global president, Crawford Del Prete, presented the event’s keynote address, outlining IDC’s long-term outlook and explaining how many of the changes instituted during the last 12 months will lead to a permanent shift in IT customer behavior. “COVID-19 has brought about huge changes in IT demand across almost every segment of the market,” said Del Prete.
“A clear example of this is the dichotomy between DX investment and non-DX investment, with the former set to grow at a CAGR of 15.5% globally between 2020 and 2023, while the latter will contract -1.4% over the same period. We expect 65% of the world’s GDP to be digitalized by 2022, with direct DX investments totaling $6.8 trillion globally between 2020 and 2023.”
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