Growth in the UAE

While growth in IT markets around the world is still uncertain, parts of the Middle East continue to resist global trends.

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By  Matthew Southwell Published  November 26, 2003

While growth in IT markets around the world is still uncertain, parts of the Middle East continue to resist global trends.

In the UAE in particular, the technology industry has demonstrated an ability to survive and even prosper when other markets fail and future long term growth now looks probable.

For instance, IDC reports that the UAE's software spending will boom from US$158 million in 2002 to US$245 million in 2007. The UAE also has the second largest market for enterprise resource planning (ERP) software in the Middle East & North Africa (MENA) region, with spending of US$28 million.

Overall IT spending in the UAE was US$865 million in 2002 and the country has the highest per capita spend rate in the region at US$380, compared to a Gulf average of just US$100.

Figures from Madar Research back up IDC's predictions, indicating that during the next five years there will be high growth in segments such as storage, security, customer relationship management (CRM) and ERP.

Furthermore, information technology services, including professional services, IT training, systems integration, hardware maintenance and technical support, experienced 11% growth last year, reflecting a strong demand for an integrated technology approach in the emirate.

Over the next five years, Madar predicts that IT services will be the fastest-growing segment of the region's IT industry, rising to US$312 million in 2008.

This growth will be underpinned by a continued buoyancy in the sector, according to Madar, as sustained double digit growth over the next five years means the IT market far outpaces overall economic growth.

All this market growth is slated to have a huge impact on the UAE's channel as it is likely to become more influenced by IT services rather than boxed products.

As local companies look for more advanced solutions, resellers will have to cease shifting boxes and instead focuses on delivering total solutions and value-added services.

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