APAC tech spend to reach 5.7 percent growth: Forrester

The Asia-Pacific region will see a 5.7 percent growth in technology spending over 2024 while also sparking the fastest growth, according to Forrester.

The Forrester report stated that with the APAC region growing 5.7 percent over the year, “India is one of the largest exporters of technology services”.

The findings also expect to see “IT exports will reach $194 billion in 2023 and total technology and service industry revenues could reach $350 billion by 2025.”

“The Asia Pacific region will see the fastest growth; six countries forecasted to have the largest GDP growth are in Asia,” the report stated. 

Speaking on the findings, Michael O’Grady, principal forecast analyst at Forrester said, “Technology companies faced significant economic headwinds this past year, but 2024 promises a better outlook.”

“Asia will see the fastest economic growth due to India’s growing IT export market as well as significant investments in tech innovation,” O’Grady said.  

According to the findings Asian countries, “especially India, the Philippines, Vietnam, Indonesia, Malaysia, and China, will see the fastest tech spend growth in 2024.”

Global scale 

Forrester also calculated global tech spending is expected to reach $4.7 trillion in 2024 “with growth occurring across all regions.” 

The report found “that as economic conditions continue to improve, technology spend will grow 5.3 percent in 2024 — up from 3.5 percent in 2023.”

“Two factors will primarily contribute to this growth: Increased spending on software and IT services, including generative AI, cloud, security, and digital, and economic growth in Asia Pacific. 

“By 2027, software and IT services will capture 69 percent of global tech spend, with investments in generative AI software predicted to reach $227 billion by 2030 at a 36 percent compound annual growth rate,” the report said. 

It said North America will grow 5.4 percent with software and IT services to capture 60 percent of US tech spend in 2027, up from 53% percent in 2018. 

The report said financial services and healthcare will see the fastest tech spend growth in 2024, “with more modest growth in retail, manufacturing, transportation, and logistics.”

Meanwhile, Europe will grow 5.1 percent despite a “challenging 2023”.

“The European economy will recover in 2024 to grow almost double the rate compared to the previous year. 

The report said in the longer term, European tech spend will see 5.1 percent to 5.7 percent growth from 2024 to 2027, “driven by higher enterprise digital maturity and more advanced cybersecurity adoption.”

O’Grady followed with similar views stating, “In the US, heavy investments in emerging technologies through the development of three primary CHIPS and Science Act agencies will fuel tech spend growth. 

“In Europe, greater investment in cybersecurity and the EU’s Coordinated Plan on AI will help the region bounce back. 

“Demand for cloud and AI is strong across all regions, with generative AI expected to boost the tech market over the next three years,” O’Grady concluded.