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Mena IT growth to drop by 5pc

Dubai, January 15, 2009

A drop in IT spend is expected in 2009 as the Mena region begins to adjust to new market conditions, revealed an information and communications technology (ICT) study.

The study was conducted by Madar Research in conjunction with marketing communications consultancy Orient Planet.

While the previous years were marked by unprecedented growth in PC expenditure wherein Arab countries took advantage of high oil prices and overall economic boom to heavily invest in computer technology, the latest study pointed out that the scenario has since changed, owing partly to the ongoing global financial crisis.

The study concluded that the region is likely to experience a five per cent drop in ICT growth in 2009 as it eases its IT expenditure.

In terms of computer penetration the UAE has maintained the number one position, recording a 26.44 per cent rate with 1.482 million installed computers in 2007.

Led by the UAE, the top five rankings for PC penetration in the Arab World are dominated by GCC countries with Oman lagging a little further at eighth among 18 countries surveyed.

Overall, the MENA achieved a PC penetration rate of 5.95 per cent – while this figure indicates enormous business opportunities and huge market potential, prevailing economic conditions and a widely anticipated drop in overall expenditure will be the primary growth inhibitors of PC adoption.

The study also predicts a slight drop in mobile phone penetration, although this particular slowdown is more dependent on the corrections made on population figures in the GCC region.

According to Madar Research, previous phone penetration estimates were drawn without having clear statistics about the number of expatriates in the GCC region; with the actual figures now available, a correction in future estimates will be made accordingly.

The effects of the global financial crisis and changes in population statistics notwithstanding, the ICT study emphasised that mobile phone subscription will remain the main driver of the MENA region's steady progress in overall ICT adoption.

In particular, the study cited the recent decisions to award second mobile licenses in Palestine and Qatar in 2007 and 2008 respectively – effectively liberalising the two remaining monopolies in the MENA's mobile phone sector – as some of the major developments that will create a long-term impact on the region's ICT adoption rate.

The ICT adoption index shows that almost all countries in the region have achieved steady progress in the adoption of information and communications technology. It is also clear that mobile phone subscriptions have remained the strongest driving force behind the widespread use of ICT tools across the Arab World,” said president and research director of Madar Research Group Abdul Kader Kamli.

“The liberalisation of the industry has certainly played a key role in unlocking its enormous growth potential in various countries. While corrections are expected to cause some short-term changes, we are optimistic of stronger long-term growth rates in the entire region, especially with Qatar and Palestine breaking the monopoly of their respective mobile phone sectors.'

According to the 2007 Arab ICT Use Index, which gauged the vigour of ICT adoption in 18 countries, mobile phone subscription in the MENA region registered a 40.51 per cent growth in 2007, helping sustain the significant progress in ICT adoption in the 18 MENA economies, whose ICT Use Index increased to 0.83 by end 2007, rising 30.21 per cent from the previous year.

The UAE topped the MENA 2007 index with a score of 2.19 becoming the only country in the region to break through the Arab ICT Use Index's 2.00 barrier. – TradeArabia News Service




Tags: Mena | arab | ITC |

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