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Middle East remains stable as Europe fails to recover

While the Middle East’s IT market remains stable and shows signs of growth, its European counterpart continues to suffer.

While the Middle East’s IT market remains stable and shows signs of growth, its European counterpart continues to suffer. The latest report from Forrester Research shows that after years of double-digit growth, Europe's IT expenditure will dip to 0.7% growth in 2002 and flatten out to 7% annual growth in 2004. Slow population growth, years of excessive demand for IT skills, and low penetration of the Internet are to blame, says the analyst house.

"Europe's slow recovery in IT spend will influence its overall economic recovery, but Europe can change the tide by increasing its reliance on technology, socialising technology, and supporting open source technology," says Forrester senior analyst, Charles Homs.

"Globally, almost 40% of the productivity gains of the past decade depended on IT investments. To keep its social structure untouched, Europe should re-emphasise its reliance on technology and gain productivity increases through technologies like mobile commerce and biotechnology. To help provide a socially acceptable environment, Europe should spend more on e-enabling its education and government,” he adds.

One solution, continues Homs, is for Europe to turn to open source systems such as Linux as it has its origins in Europe. “Only 26% of all IT technology has its origin in Europe, but to build its own IT sector would take decades. Instead, Europe should rely more on open source systems like Linux,” he says.

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