Mideast needs huge investments in ICT

DUBAI — Large investments might be required by Middle East governments and private sector to sustain a fast development rate in Information and Communications Technology (ICT) sector, said Karim Sabbagh, UAE-based vice-president, Booz Allen Hamilton.

By Sandhya D'mello

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Published: Mon 14 Feb 2005, 9:40 AM

Last updated: Thu 2 Apr 2015, 4:25 PM

Sabbagh, said: "Arab countries should target an ICT spend level of 7.5 per cent of GDP, which translates to over $30 billion for the selected countries. The Economic and Social Commission for Western Asia’s (ECSWA) effectively confirms this number by stating that the total investments required to bring the Arab world’s ICT penetration rates up to the world average is around $ 40 billion."

"Already, regional governments have shown some headway on ICT development path, yet they need to strengthen their commitment to a long-term sector development. Such a strategy would invariably drive faster growth across all economic sectors, ultimately leading to a sustainable social and macroeconomic development and bringing lasting change that yields a greater sense of well-being among individuals across the entire Middle East region," he observed.

According to a research report, ICT has been a primary engine of economic growth globally in recent years, and as such, it has been much studied by governments, particularly in the developing world. The ICT sector benefits other businesses by allowing them to increase their overall productivity and improve the quality of products and services they offer through innovation, all while reducing the cost to the end consumer.

The report further states that ICT investment in the Arab world, in absolute and relative terms, represents a fraction of what is being invested in other countries. It averages only 4 per cent of GDP, according to Booz Allen, compared to an 8 per cent of GDP average in developed countries.

The study by Booz Allen was conducted on seven regional countries, which include Bahrain, Egypt, Jordan, Lebanon, Saudi Arabia, Syria, and the UAE. The ICT sector was assessed along three main dimensions — environment conditions at a macro level, readiness of stakeholders to participate in ICT development and extent of use of ICT products and services.

Almost all selected countries, in the study, manifested signs of development, particularly in terms of ICT readiness; however some of them have not yet provided an environment satisfying in full the preconditions for ICT growth.

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