Saudi Arabia’s IT and communications sector (ICT) grew by 8% between 2019 and 2021, hitting a total value of $32.1bn.
The figures, from analyst company IDC, also predict 2.3% growth this year, with the sector’s value set to reach almost $33bn.
IDC said Saudi Arabia is one of the fastest-growing ICT markets in the Middle East, showing a strong response to the Covid-19 pandemic.
Hamza Naqshbandi, associate vice-president for Saudi Arabia and Bahrain at IDC, said: “The Kingdom’s response to the pandemic was one of the strongest and most robust that any economy had.”
Naqshbandi said Saudi Arabia was ahead of the curve in terms of its preparedness and response to the pandemic, and its Vision 2030 initiative was key to its success.
The Saudi government’s Vision 2030 programme, which is increasing the focus on its digital economy, is part of the country’s economic diversification and efforts to reduce its dependence on oil sales.
To this end, the country is putting in place an infrastructure to support an IT sector. According the Saudi Communications and Information Technology Commission, the country has added 37,000 telecommunication towers since 2017, covering about 99% of the nation.
“The growth we have forecast for Saudi Arabia’s ICT sector in 2022 is particularly significant when viewed in a regional context,” said Naqshbandi.
Steven Frantzen, senior vice-president and managing director for the EMEA region at IDC, said businesses in Saudi Arabia should prepare for the future.
“Digital is now a permanent, yet dynamic fixture in our world,” he said. “Entire industries want to intelligently leverage data to their advantage and can do so because they have faster access to digital technologies.
“But ‘digital first’ isn’t about picking or prioritising a particular technology or business model – it’s an organisational aspiration and a desired business cultural characteristic that should apply across customer engagement, hybrid work, unified security, remote operations and shared business value.”
IT projects in Saudi Arabia include a $500bn investment in the economic zone of Neom, a smart city that will be built from scratch, where inhabitants will get around by using fully autonomous vehicles (AVs).
Meanwhile, the country is investing $6.4bn in the digital technologies of the future and the tech startups that will harness them. This announcement was made during a major new tech event, known as LEAP, in Saudi capital Riyadh.
There are about 318,000 jobs in the Saudi Arabian technology sector, and companies including Google, Alibaba, Oracle and SAP have invested more than $2.5bn in the country. Meanwhile, venture capital investment in Saudi Arabia last year exceeded the total for the two previous years combined.
According to TechTarget/Computer Weekly’s annual IT Priorities survey, 63% of IT decision-makers in the Middle East region are planning to increase their IT budgets by 5% or more in 2022. The survey found that Middle East-based IT leaders expect IT budgets for 2022 to be equal to, or above, pre-pandemic levels, with security spending expected to take the biggest share.