Mideast IT sector heads for huge growth

The Middle East IT industry is still probably the fastest growing IT market on the planet, although markets such as the UAE are maturing.

A sign of this maturity is that the last of the big US IT giants, Computer Associates has just set up its own direct sales operation under Intel's former regional boss Gilbert Lacroix.

How long will it be before Dell Computers does the same, and brings its direct Internet sales model to the region?

The same is true for market launches. There was a time when the Middle East was a dumping ground for old technology. Now launches feature the latest developments, sometimes before they hit the markets of the West.

Have a look at the Linux offerings from Sun and AMD at Gitex. This is the state-of-the-art. Or how to use Linux to save tens of millions drilling for oil!

Make a visit to Canon to see the very latest in digital imaging technology, from the smallest cameras to the most sophisticated office machines combining many functions. But the question at Gitex is always, how much further can the industry go?

The International Data Corporation, the recognized authority in these matters, predicts that in the UAE IT spending will rise from $1.2 to $1.65 billion by 2008, while the Middle East and North African region is set to grow from $6.9 billion in 2003 to around $13.4 billion with particularly marked increase in both Saudi Arabia and the Maghreb.

This suggests that the more mature UAE market will increasingly serve as a hub for the expansion of the entire IT sector in the Middle East.

On the other hand, forecasts tend to be either too pessimistic or too optimistic. And there is a strong argument to suggest that the IDC is being too cautious in its market predictions.

For if the oil price stays at high levels then the level of investment in IT could be very much higher. Only in the UAE is the market approaching anything near saturation point, and even in the emirates growth rates are probably being understated given the present investment-led economic boom.

So enjoy Gitex this week if you get the chance to go. You are looking at the future of the Middle East.