MENA Region's IT Spending to Surge 9% Amid Digital Transformation

The Middle East and North Africa (MENA) region is set to experience a notable surge in information technology (IT) spending, with projections indicating a 9% increase for the next year. This growth is primarily fueled by the region's accelerating digital transformation, the rapid adoption of artificial intelligence (AI) and smart automation technologies, and the enhancement of digital infrastructure.

This anticipated growth in IT spending underscores the region's dedication to harnessing technology to stimulate economic development and foster innovation. The digital transformation initiatives are designed to improve operational efficiency, enhance service delivery, and create a more competitive business landscape. AI and smart automation technologies are expected to be central to this transformation, enabling organizations to optimize processes, reduce costs, and boost productivity.

Infrastructure upgrades are essential for supporting the escalating demand for digital services and ensuring reliable connectivity. This includes investments in data centers, cloud computing, and high-speed internet networks. The region's emphasis on digital infrastructure is aimed not only at addressing current needs but also at preparing for future technological advancements.

The projected 9% increase in IT spending is a significant indicator of the region's strategic priorities. It reflects a growing awareness of the critical role technology plays in driving economic growth and competitiveness. Governments and businesses in the region are increasingly investing in IT to stay ahead and capitalize on emerging opportunities.

This growth in IT spending is also expected to have a positive impact on the region's job market. As organizations invest in technology, there will be a heightened demand for skilled IT professionals. This presents an opportunity for the region to cultivate a highly skilled workforce capable of driving innovation and supporting the digital economy.

In the MENA region, the data center systems sector is anticipated to be the fastest-growing segment, with spending expected to reach 130 billion dollars by 2026, marking a 37.3% increase. However, this growth rate is expected to slow down from the 69.3% high recorded in 2025 as the market transitions from a rapid construction phase to a more sustainable and incremental investment phase.

This growth in data center systems is driven by the increasing investment in AI-enabled software and AI-optimized infrastructure by chief information officers and technology leaders in the region. The demand is primarily coming from government entities, large-scale cloud service providers, technology suppliers, and institutions focused on AI model development and deployment, rather than traditional enterprises or individual consumers.

Following the surge in data center spending, the next significant wave is expected to be in software expenditure. As the region integrates generative AI (GenAI) into its operations, software spending is projected to grow by 13.9% by 2026, reaching a total of 204 billion dollars. This trend aligns with the region's strategic development plans, such as Saudi Arabia's "Vision 2030" and the United Arab Emirates' "National AI Strategy 2031."

The United Arab Emirates, for instance, aims to become a global leader in AI-driven economies. The region is collaborating with OpenAI to establish a 5,000-megawatt AI park in Abu Dhabi, which will not only provide public access to ChatGPT but also leverage its global-scale computing infrastructure to become a regional AI hub.