According to the latest release of Worldwide ICT Spending Guide Industry and Company Size, IDC forecasts Asia/Pacific* ICT spending to grow by over 5%, to reach $1.04 trillion in 2022, and expected to reach $1.21 trillion by 2025 with a compounded annual growth (CAGR) of 5.6% by the end of 2025. In 2021, organizations in the region continued to navigate disruptions, accelerations, and cross-current spurred by the COVID-19 pandemic and changing economic conditions. However, regions’ digital acceleration led to quick economic recovery and a move towards the digital-first economy. Recent IDC research indicates that despite concerns about supply chain, inflation, labor shortages, and COVID variants majority of the businesses expect to either maintain or increase technology investment in the current year.
“Growing supply catering to both local, as well as international demand, is helping the region regain pre-covid growth forecasts. Government initiatives are becoming key influencers in organizations’ shift towards a digital-first world,” says Mario Allen Clement, Senior Market Analyst for IDC IT Spending Guides, Customer Insights & Analysis. “Focus towards customer engagement and retention are key areas which will improve organization’s future”, he adds.
As per a recent IDC survey, most respondents across the region feel that uncertainties due to COVID-19 or supply chain disruptions will not impact the economy in 2023. However, changing environmental regulations and cybersecurity threats will play an increasing role in organizations’ technology investment plans.
“The evolving geopolitical situation in Europe may act as a dampener in the region’s economic growth,” says Vinay Gupta, Research Director at IDC IT Spending Guides, Customer Insights & Analysis, “Enterprise are keenly following inflationary trends and will adapt their technology budgets accordingly,” he adds.
With respect to verticals, banking continues to dominate the ICT investment as it is more customer-centric and requires engaging with the customers. For example, customers do not need to drop a cheque in developed countries. Now they can use the phone app to scan a cheque or even scan the QR code for further processing. As a result, IT investments in the banking sector are expected to grow at 6.6% in 2022. Spends in telecommunication are expected to grow by 5.8% in 2022. Telecommunication providers have recently rolled out multiple plans to cater to even remote locations allowing them to install equipment across remote locations.