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The United Arab Emirates (UAE) is one of the most prosperous countries in the Middle East and one of the region’s largest IT service markets. While the recent global recession brought an abrupt end to a period of unprecedented growth in the UAE, there remains significant potential for expansion in the IT service sector. It is therefore unsurprising that a growing number of foreign vendors are setting up operations in the key business centers of Dubai and Abu Dhabi. This report aims to provide an overview of the current state of the UAE’s IT service market, including a close look at the competitive landscape. It will also identify key points regarding the UAE’s economy as a whole, of which all firms looking to do business in the region should be aware.
SUMMARY
Impact
Ovum view
Key messages
BACKGROUND – THE UNITED ARAB EMIRATES
Two dominant monarchies
The wealth of the UAE is derived from its abundant oil and gas reserves
The drive to diversify beyond oil
Tax breaks make the region attractive for foreign investors
Free zones are the focus for most investors
IT SERVICES IN THE UAE
Growing steadily
The UAE is one of the Middle East’s biggest IT service markets
State ownership is a major feature of the UAE economy
COMPETITIVE LANDSCAPE
Expanding but fragmentary
A wide array of local vendors
International vendors have struggled to break through
Indian vendors have established themselves in the UAE
EMBRACING OFFSHORE DELIVERY MODELS
The world’s leading global sourcing hub
The debt crisis in The UAE has passed, but caution remains
RECOMMENDATIONS
Recommendations for vendors
Commit fully to the market
Form links with local companies
Consider the cultural implications of setting up in the UAE
APPENDIX
Further reading
Methodology
List of Tables
Table 1: Leading countries by oil reserves
List of Figures
Figure 1: Monthly crude oil prices, January 2000–April 2010 ($ per barrel)
Figure 2: Number of deals signed in the UAE, 2005–2009
Figure 3: Number of Middle East IT service deals by signing region
Figure 4: Total contract value of Middle East IT service deals by signing region
Figure 5: Number of IT service deals signed in the UAE by vertical market
Figure 6: Number of IT services deal signed in the UAE by vendor
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Future IT Trends and Projects: Healthcare Technology in the Middle East (Industry Focus)
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