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$77b spend to revamp IT markets in Africa, Middle East

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After it contracted by 4.9 per cent in 2020, IT spend across the Middle East, Turkey, and Africa (META), will make a welcome return to growth this year, increasing 2.8 per cent to $77.5 billion.

This is according to the latest forecast revealed by the 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 recently for the first-ever virtual edition of IDC Directions Middle East, Turkey & Africa.

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Among the speakers are Group CIO, Dangote, Prasanna Kumar Burri; Head of Research & Emerging Technologies, Nedbank, Chris Holland, among others.

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 IDC Middle East, Turkey, and Africa 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 per cent of total IT spend in 2020 to 37 per cent in 2024.

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“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.

He added: “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: overall ICT spend (telecom services and IT) will grow 1.9 per cent to surpass $209.5 billion; public cloud services, 26.7 per cent or $3.7 billion; SaaS, PaaS, and IaaS, 24.5 per cent, 30.6 per cent, and 30.7 per cent, respectively. Others are professional cloud services, $1.6 billion; AI software 23 per cent or $540 million; while security (hardware, software, and services) will grow 7.1 per cent to reach $3.3 billion.

Global President, Crawford Del Prete, outlined IDC’s long-term outlook and explained how many of the changes instituted during the last 12 months will lead to a permanent shift in IT customer behaviour.

“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 per cent globally between 2020 and 2023, while the latter will contract -1.4 per cent over the same period. We expect 65 per cent of the world’s GDP to be digitalized by 2022, with direct DX investments totalling $6.8 trillion globally between 2020 and 2023.”

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