With the acceleration of global blockchain adoption, Middle East and Africa (MEA) countries are expected to significantly increase their technology spending in the next few years.
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According to the latest report from the US market research company International Data Corporation (IDC), governments across the MEA region will see a 400% increase in investment in blockchain-based solutions within four years.
MEA will increase blockchain spending from $ 21 million in 2019 to $ 105 million by 2023
The IDC report, released on February 12, outlines the growing share of blockchain technology in the digital transformation plan of the MEA region. Specifically, MEA countries are expected to increase their blockchain spending from $ 21 million in 2019 to $ 105 million in 2023, with a compound annual growth rate close to 50%.
According to the report, authorities in the MEA region are actively developing blockchain-enabled solutions to reduce fraud, improve security, and improve public management.
Jyoti, vice president and regional managing director of IDC's Middle East, Turkey and Africa division, stressed that governments in the MEA region face challenges in learning new technologies such as blockchain.
Lalchandani also noted that many government agencies are not yet ready for digital transformation:
"Governments in the region are under increasing pressure to become more efficient. However, this has proven to be a difficult task, as many government organizations are not ready for digital redesign at all. Are you looking to integrate 5G, manual Intelligence, and blockchain or preventing the intrusion of digital trust, government agencies need to learn a whole new set of IT skills. "
Blockchain's small share of total digital transformation expenditure
Although blockchain is increasingly being explored in MEA countries, blockchain spending still accounts for a small portion of the total digital transformation plan. According to IDC data, the total expenditure of MEA countries in the entire digital transformation in 2019 is $ 12.8 billion, and it is expected to exceed $ 15 billion by 2023.
With the development of the industry, IDC has been continuously updating the blockchain spending forecast. The research company had previously predicted that global blockchain spending will reach nearly $ 3 billion in 2019, an increase of 89% over 2018. IDC also predicts that this number will reach nearly $ 16 billion by 2023.
Although the blockchain spending in the MEA region is expected to increase significantly, other regions such as the Asia Pacific (excluding Japan) (APEJ) are expected to spend far more than $ 105 million in the next few years. According to another IDC forecast, APEJ will spend up to $ 2.4 billion on the blockchain by 2022.