Financial crisis to slow IT spend in region
GITEX: Crisis likely to slow growth, but growth still expected to remain strong - eSolutions.
The global financial crisis is likely to slow growth in the Middle East IT industry, but growth is still expected to remain strong, the managing partner of software provider eSolutions said on Monday.
"We do need to be cautious here [in the Middle East], due to the financial turmoil... growth rates will slow a little, but will still be very strong," Gaby Matar told Arabian Business on the sidelines of the Gitex technology exhibition.
The global financial crisis has frozen credit markets and stunted economic growth in countries around the world. In the Gulf, GDP growth is expected to slow to an average of 4.5 percent in 2009 from 6.2 percent this year, according to a recent report by Merrill Lynch.
Matar said the UAE has seen an annual growth rate of 20 percent for company spending on IT-related software over the last few years, while the Middle East has seen an average annual growth rate of 12 percent, citing data released in August by IT research and advisory firm Gartner.
"According to a recent Gartner report, by 2009 $559 million will be spent by companies [in the Middle East] on software annually. By 2011, it will $725 million. The UAE and Saudi Arabia have the strongest growth rates for spending, and Kuwait is following them."
Matar said the Middle East is only at the beginning of implementing IT systems and therefore growth would likely remain strong in the coming years.