June 14, 2024
BANGKOK – The “Asia Pacific Tech Spend Forecast” published on Tuesday (June 11) expects tech spending in the region to remain robust and grow by a compounded annual growth rate of 6.4% to 7.4% annually, reaching US$876 billion in 2027.
Over the next few years, software spending would continue its rapid growth, followed by spending on IT services, communications equipment, and computer equipment, the report said.
The share of software purchases would climb from 26.4% in 2024 to 30% of total tech spend in 2027, outpacing the other IT categories due to demand generated by artificial intelligence (AI) and AI-augmented enterprise software and services, the report said.
“While challenges such as regulatory environments, global economic conditions, and talent shortages in the region present hurdles, overall, the APAC market is well-positioned for tech growth,” Forrester’s principal analyst Leslie Joseph said.
“As the region continues to grow in importance in the tech world, new opportunities offered by the explosion of AI and the increased demand for cloud can be significant revenue and growth drivers for firms.”
However, the spending in five Southeast Asian economies – Indonesia, Malaysia, Philippines, Thailand, and Vietnam – as well as Taiwan, is expected to increase by only 1%, or $74 billion, this year.
Uptick in digital consumption spurred by large Millennial and Gen Z populations, favourable policy environments, and investments from tech giants would accelerate digital innovation, the report said.