Asia Pacific vertical market IT spending is forecast to grow 2.9 per cent in 2009, according to IT research firm Gartner. This is way above the forecasted worldwide trend for vertical market IT spending which is 0.5 per cent.
Gartner said that the communications industry posts the highest growth forecast as countries such as India and China continue to spend on third-generation (3G) and next-generation infrastructures. The transportation industry posts the second-highest growth rate as intra-Asia demand remains. This is followed by utilities and services.
However, according to the research firm, Japan will continue to struggle in 2009 with IT spending forecast to decline by 0.1 per cent.
Worldwide growth to be slow
Gartner reported that the worldwide vertical market IT spending is projected to total US$2.7 trillion in 2009, a mere 0.5 per cent increase from 2008. Utilities, Healthcare and Government are expected to be the strongest-growing segments of the market in 2009.
"The economic slowdown triggered by the US subprime market crisis, along with fluctuating oil prices and currency exchange rates impacted many industries and countries around the world in IT spending," said John-David Lovelock, research vice president for Gartner. "Internal spending, hardware and system integration in the financial sector were particularly hard-hit in 2008 and will continue to be affected through 2009. In contrast, healthcare grew 8.3 percent worldwide in 2008, and utilities grew 7.7 percent."
The utilities industry is forecast to grow the most in 2009 with 2.9 per cent growth, said Gartner. The healthcare industry is expected to post the second-highest increase in 2009 with 2.2 per cent growth. The research firm added that uncertainty about the depth and duration of the economic slowdown dominated the banking and investment sector in the last quarter of 2008. This uncertainty led to declines and postponements in IT spending at many large financial services companies, and this is expected to continue in 2009 as worldwide financial services IT spending is forecast to decline 0.7 per cent.
According to Gartner, the US financial services sector is forecasted to be hardest hit, however, major IT investments in less-affected countries such as Canada and Mexico and regions such as the Middle East and Africa will minimise the decline in the sector worldwide.
This story, "Asia-Pacific Expected to Boost Tech Spending" was originally published by MIS Asia.