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Businesses across the Middle East and North Africa (MENA) region are likely to spend $7.6 billion more on IT this year, as tech investments are poised to increase amid improving economic conditions, according to research firm Gartner.
Total expenditures for the year will reach $171 billion, up by 4.5 percent from last year, with the biggest chunk going to communications services, at more than $116 billion.
Tech spending hit a snag in 2020 despite the emergence of remote work and digital payments, as the pandemic forced organisations to cancel or put tech-related projects on hold. Overall spends last year grew by only 2.7 percent, with most of the segments experiencing flat growth, except for communications services that grew 7.2 percent.
However, with the focus now on business recovery and state-backed IT initiatives have recently been launched, tech budgets will consequently receive a boost.
“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, 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,” Lovelock said.
Spending in different segments
Gartner’s analysis also showed that spending on IT services will grow by 8.7 percent to $13 million this year, while spending on devices will increase by 8 percent to $27 million.
The data centre systems segment will also see higher sales, with 2021 expenditures forecast to grow by 6.8 percent to more than $5.4 million.
“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,” Lovelock noted.
To support the rapid digitisation efforts, CIOs in the region will increase allocations for servers, applications and infrastructure software this year, Gartner said.
The remote work trend will also fuel the increase in spending on mobile devices and other technologies that support telecommuting, such as the digital solution called “desktop-as-a-Service” (DaaS).
(Writing by Cleofe Maceda; editing by Seban Scaria)
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