Gartner Predicts MENA IT Spending to Hit $230.7 Billion in 2025, Driven by AI and Cloud Adoption

Technology

Gartner Predicts MENA IT Spending to Hit $230.7 Billion in 2025, Driven by AI and Cloud Adoption

IT spending across the Middle East and North Africa (MENA) region is forecasted to grow by 7.4% in 2025, reaching $230.7 billion, according to Gartner, Inc. The latest projections were unveiled during the Gartner CIO & IT Executive Conference 2024, held from November 19-21 in Dubai.

“Governments and private enterprises in MENA are intensifying investments to establish the region as a global hub for AI innovation, backed by robust cybersecurity and cloud platforms,” said Mim Burt, Managing VP Analyst at Gartner. These efforts aim to develop scalable infrastructure, foster a skilled workforce, and create innovative business models that enhance customer experiences.

Data Center Systems and GenAI to Lead Growth

The data center systems segment is expected to see the highest annual growth rate at 14.9% in 2025, fueled by AI-driven demand for increased data storage and processing capabilities. Investments by hyperscale cloud providers in sustainable AI-enabled infrastructure are further boosting this sector.

Software spending will also witness significant growth of 13.7%, with CIOs increasingly adopting generative AI (GenAI) applications to improve the digital workplace, customer experiences, and product quality. Burt noted that MENA CIOs are transitioning from pilot projects to more strategic GenAI implementations based on lessons learned and value realization.

However, challenges remain. Eyad Tachwali, Sr. Director Advisory at Gartner, highlighted that CIOs are recognizing the complexities of data and cost versus value in GenAI projects. “CIOs will need to align use cases with business priorities and foster AI literacy to maximize returns on GenAI investments,” Tachwali said.

Gartner’s Comprehensive IT Spending Insights

Gartner's forecasts draw from extensive analysis of vendor sales across IT hardware, software, services, and telecommunications. The firm’s latest quarterly IT spending report, part of the Gartner Market Databook, 3Q24 Update, offers a detailed outlook for industry leaders navigating market opportunities and challenges.

For additional insights, Gartner offers a free webinar, IT Spending Forecast, 3Q24 Update: 2025, The Trough is Coming.