Business Bureau, Gulf Today

IT spending in the UAE is expected to grow by a compound annual growth rate (CAGR) of 8% to reach Dhs 23.1 billion by the end of 2019, new analysis from Dubai Chamber of Commerce and Industry has revealed.

The analysis, based on recent data from Fitch Solutions, was released on the sidelines of Gitex Technology Week 2019. The data showed IT spending in the UAE increasing at a CAGR of 2.3% between 2014 and 2018, with this value forecast to grow by 7.2% annually over the next five years.

Digitisation of the UAE economy, growing adoption of Internet of Things (IoT) technologies and Expo 2020 Dubai were identified as key factors supporting the robust outlook for the sector. According to the findings, the IT sector accounted for Dhs 21.4 billion or 1.4% of the UAE’s GDP in 2018.

IT services sales in UAE reached a record Dhs11.4 billion in 2018 and recorded double-digit year-over-year (y-o-y) growth of 10.2%. Computer hardware sales in the UAE registered a 6.7% y-o-y uptick last year to hit Dhs6.9 billion, while software sales grew by 9.7%, reaching a value of Dhs3 billion.

Hardware sales, which include personal computers and servers, were mainly driven by strong demand from businesses and consumers, as well as economic diversification plans. Personal computers (PCs) and server sales are the major components of computer hardware.

According to the findings, the UAE has one of the highest household PC penetration rates in the region. Purchases of PCs by consumers are expected to maintain momentum as Smartphones are seen as complementary products to computers rather than substitutes.

Several global companies like Amazon Web Services and Alibaba have invested in the UAE’s IT market in recent years which have strengthened business confidence in the market. As a result, the supply of IT services has increased in line with consumer demand in the region.

The UAE remains the most attractive IT market in the region and the country continues to attract industry leaders from around the world. Companies will likely continue to invest in IT infrastructure, especially in network systems, hardware and software over the next few years.

The UAE’s IT market offers a wealth of business opportunities for vendors and investors. Demand for cybersecurity software and services is projected to increase as public and private sector players look to reduce the risk of cyberattacks and adopt cloud computing and Internet of Things solutions.

Companies operating in key economic sectors such as energy and financial services are expected to maintain high levels of spending on IT products. Financial firms are mainly focused on buying IT products related to banking, mobile banking, payment solutions, customer data analysis, stock trading and asset management platforms. On the other hand, oil and gas companies will likely to spend on smart mining solutions as part of their aims to enhance operational efficiency.

More businesses are purchasing IT products which monitor production and employee performance as there is strong demand for data collection, analysis and automation services. In addition, the UAE is expected to scale up investments in artificial intelligence and blockchain solutions - a trend that should lead to more growth opportunities for businesses.

Meanwhile, Abu Dhabi Securities Exchange (ADX) is showcasing its key advances in artificial intelligence and in digitisation that enhance the services of the Exchange for local and international investors. The technology developments Arqam and ADX Digital Wallet powered by payit were demonstrated at the Abu Dhabi Government Pavilion at GITEX Technology Week 2019, taking place 6th-10th October at the Dubai World Trade Centre.

ADX is employing advancements in Artificial Intelligence (AI) through its new platform Arqam, used for business management to support the right decision-making based on multiple visions and accurate data provided by the Platform. Arqam employs multiple sources to provide machine-computed advice and information, to support the decision-making process of management. The Platform uses a selection of data mining, analytical data process of internet data and reporting to provide a suite of information. This is all fed into a dashboard interface which provides live data, with the bonus of easy, user-friendly access either from a computer or a mobile phone.

Commenting on Arqam, His Excellency Khalifa Salem Al Mansouri, Acting Chief Executive of ADX, said “The attributes of Arqam empower board of directors, management, and decision-makers with a variety of different perspectives to boost the executive process. The advantages of this application also ensures that customers and stakeholders are brought closer into the process, by providing more insights into the Exchange based upon the Platform’s decision support system.”