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South Africa - IT Spending to Grow 10% in 2010
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South Africa - IT Spending to Grow 10% in 2010

Mar 25, 2010
Strong demand for hardware products and services as well as 2010 World Cup are expected to push IT spending in South Africa up by 10%.

According to the projections of global research firm International Data Corporation (IDC), South Africa will see 10% surge in its IT spending that will reach $11.6 Billion in 2010, as per the news published by allAfrica.com.

In 2009, the country’s IT expenditure fell 8% to $10.6 Billion as recession-hit companies cut down their technology budgets. Businesses are likely to maintain a watchful attitude towards IT spending this year in the wake of current economic conditions, but growth avenues are still expected to be there.

Higher demand for services and hardware products has helped the South African IT market. The decline in adoption seen in 2009 will lead to the release of significant pent-up infrastructure demand in some sectors, boosting the uptake in one or so year.

In addition to this, the 2010 FIFA World Cup has also positively influenced the IT investments on the systems bearing direct relation with the event.

Acknowledging the true potential of the South African IT market, the government is seeking to expand its size. Therefore, to promote the development of the market, the government is conducting numerous studies and creating various policies.

The government also continues to be the leading IT spending vertical. In the current fiscal, more than ZAR500 Million ($68.4 Million) of IT investment will come from the Department of Home Affairs (DHA), aimed at improving immigration services, service delivery and combating corruption.

Moreover, the government’s liberalization measures, increasing broadband subscription and launch of 3G mobile networks have also bolstered the country’s telecom sector.

According to a Research Analyst at RNCOS, “South Africa has all that needs to become an IT giant in the global market. As the population is increasingly becoming computer literate and realizing the economic benefits of Internet, popularity of IT is rising in the country. In addition to this, vast population base is also luring international players to the country, thereby making it a favorable destination to outsource.”

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