Iraq to spend over six billion dollars on IT development
Iraq is set to spend close to $6.4 billion annually on information and communication technology (ICT) by 2008, according to a moderate growth-rate scenario of the Iraqi economy.
The projection is part of a comprehensive study on current ICT profile and future development of Iraq's 'knowledge economy,' which in 2008 will witness up to triple-digit growth in some areas, such as mobile-phone and Internet use, compared to 2002.
According to Madar Research Group , Iraq is expected spend around eight percent of its gross national product (GDP) on ICT-related development projects annually between 2003 and 2008. This ratio, which is equivalent to world average ICT spending and much higher than that of the region, will be fuelled by Iraq's need to build from scratch an infrastructure that is either heavily damaged by the recent US-led war on the country, or made obsolete by over a decade of strict UN sanctions.
To quantify the resources that Iraq is predicted to spend on ICT development and consumer products, the Group devised a GDP growth forecast model that draws on the characteristics the Iraqi economy shares with Saudi Arabia's, while outlining the course the Iraqi economy is likely to take under its own variables. The result was three different scenarios and levels of GDP growth that share the same rate of IT spending.
One of the parameters used in the model was Iraq's highest and lowest points of economic performance in the last 25 years as compared with the economy of Saudi Arabia. In 1979 when Iraq's GDP was the highest, it constituted 48 percent of Saudi Arabia's GDP then. In 2002, Iraq's GDP was only 16 percent of Saudi Arabia's.
"We have built our GDP projections on the most solid components of the economy, such as oil production, and other vital and promising elements,” said president and research director of Madar Research Group , Abdul Kader Kamli. “To accommodate the political-economic variables our analysis has led to three scenarios for GDP growth over the next six years. Even the low-growth scenario brings huge opportunities for ICT providers and investors.”
The annual growth rate in the number of Iraqi mobile phone users is forecasted to reach 158 percent and Internet users 100 percent between 2002-2008. In addition, the number of fixed-line subscribers and installed personal computers are expected to grow annually by 33 and 47 percent, respectively.
The forecast gives more weight to certain ICT parameters which are more essential and basic, and least to be influenced by dramatic events that may take place in Iraq, such as growth in PC installed base, numbers of mobile and fixed-line subscribers, and the number of Internet users. Software and solutions, for instance, will not have a high turnover, and will be of low priority for Iraqis if economy undergoes a slow growth. — (menareport.com)
© 2003 Mena Report (www.menareport.com)