Middle East and North Africa (MENA) region is set to experience a 5.2 percent increase in IT spending, reaching $193.7 billion in 2024 as compared with 6.6 percent growth in 2023, according to the latest forecast by Gartner.
“Local organizations are becoming cautious with their IT expenditures,” commented Miriam Burt, Managing VP Analyst at Gartner, highlighting a trend of more measured spending in the region.
Breakdown of IT Spending
Data Center Systems: Expenditures are expected to decline slightly by 0.3 percent, dropping to $4.809 billion from $4.826 billion in 2023. This decrease is primarily due to reduced spending on external controller-based (ECB) storage, as organizations shift towards alternative solutions such as software-defined storage (SDS), hyperconverged infrastructure software (HCIS), and storage-as-a-service models.
Devices: Spending is projected to decrease by 4.5 percent, falling to $27.092 billion from $28.379 billion. This reduction reflects a cautious approach to investments on mobile devices.
Software: In contrast, software spending is anticipated to grow significantly by 12.3 percent, reaching $15.229 billion from $13.555 billion. This surge is driven by increasing investments in cloud migration, artificial intelligence (AI), generative AI (GenAI), and Internet of Things (IoT) implementations.
IT Services: Expenditures are forecasted to rise by 9.6 percent to $19.016 billion from $17.338 billion. Security remains a critical focus, alongside a growing preference for professional and consulting services to facilitate business transformations.
Communications Services: This segment is expected to grow by 6.3 percent, with spending projected to hit $127.584 billion from $120.026 billion. The rise in demand for XaaS (Anything as a Service) models contributes to this growth.
Strategic IT Investments
MENA IT leaders are channeling more resources into professional and consulting services to prepare for extensive cloud migrations and the deployment of advanced technologies such as AI and GenAI. However, Gartner notes that while GenAI is influencing cloud services spending, its immediate impact on overall IT expenditures will be limited in 2024.
“Regional CIOs’ focus today is primarily on everyday lower-cost use cases, rather than on costly game-changing AI,” explained Eyad Tachwali, Senior Director Advisory at Gartner.
Infrastructure Developments
Hyperscalers are notably accelerating investments in local data centers, including the development of world-class green data centers, to support the growing demand for AI and GenAI infrastructure.
