IT spending in MENA to reach $171 bn in 2021

Digital ecosystem: Businesses in MENA show renewed interest in IT projects as impact of Covid-19 declines in the region

BUSINESS REPORTER

MUSCAT, APRIL 26

IT spending in the Middle East and North Africa (MENA) is projected to total $171 billion in 2021, an increase of 4.5 per cent from 2020, according to the latest forecast by Gartner, Inc.

“IT projects were either put on hold or cancelled in MENA because of Covid-19. In 2021, as the situation in the region improves and businesses understand the true value of a resilient digital ecosystem, IT spending will return to a pre-pandemic growth rate,” said John-David Lovelock, distinguished research vice president at Gartner.

“In the first quarter of 2021 projects such as ‘remote work visas’, ‘Smart Dubai 2021’, and other economic policy regulations were launched. These are expected to boost technology investments in the region.”

In 2020, IT spending in MENA grew 2.7 per cent, as compared to 2020. Most of the segments experienced flat growth, except for communications services which grew 7.2 per cent last year.

This year, enterprise software will experience the highest growth at 14.5 per cent. The increase in the number of remote workers will be the catalyst to this growth.

Growth will also return to segments such as data centre systems and devices over the next two years.

IT spending in MENA will return to pre-pandemic levels and even surpass it over the next two years.

“Different economies have reacted differently to the pandemic. Rapid digitalization of MENA, especially the gulf countries, began before the pandemic. While 2020 slowed the growth of IT in the region, the ‘K-shaped’ recovery has begun faster in this region, as compared to Asia and Latin America,” said Lovelock.

CIOs in MENA will increase their spending on servers, applications and infrastructure software in 2021, to support the rapid digitalization efforts.

Additionally, the increase in the remote workforce will increase spending on mobile devices and remote working technologies such as desktop-as-a-service (DaaS).