The Kuwaiti Information Technology (IT) market is set to post a rebound in 2021, after severe weaknesses in 2020 caused by the Covid-19 pandemic. The situation led to a severe oil price collapse and the poor business environment that weighed on government investments, enterprise sentiment and household spending levels. Looking ahead, we expect the economy to post a recovery in 2021, as pent-up demand is unlocked across all segments. The medium-term (2021-2025) outlook is stable, with growth trends driven by economic diversification efforts and a string of public and private sector investments in capital infrastructure that are set to dominate over the coming years. The biggest opportunities are concentrated in software and services, where enterprise modernisation and economic vertical expansion are positive developments. However, there are still significant downside risks in the political, economic and security realms with the potential to undermine our recovery scenario.
The outlook for the Kuwaiti IT market is positive, driven by recovering oil prices, economic diversification and a series of public and private sector investments in capital infrastructure that are set to dominate the national agenda over the coming years. However, we note that Kuwait’s IT market is small and lacks the sophistication of most developed economies because of an oil-centric economy. Looking ahead, the biggest opportunities are concentrated in software and services where enterprise modernization and economic vertical expansion are positive developments. There are however, still significant downside risks in the political, economic and security realms with the potential to undermine our positive core growth scenario.
