?Spending on information technology (IT) by consumers and enterprises in China is expected to reach $216.7bn in 2010, representing 5.9% growth from $205bn in 2009, according to a report from IT research and advisory firm Gartner.
According to Gartner, the Chinese economy grew 8.7% in 2009, with IT spending growing at 7.5% year-on-year. China’s government responded to the downturn by injecting $583.9bn in stimulus measures during the latter part of 2008, specifically addressing infrastructure and public facilities and organisations.
The research firm estimates $40bn of this stimulus funding to impact the Chinese IT industry from 2009 to 2013, with the highest level of spending in 2010 as most stimulus policy measures and plans were finalised and executed during 2009. IT spending represented 6.1% of GDP in 2009. This ratio is expected to decrease to 5.5% during 2013, with evolving of IT markets.
Gartner expects telecommunications to be the biggest area for IT spending in 2010 with $158.2bn, followed by computing hardware ($43bn), IT services ($9.4bn) and software ($6.2bn). IT services and software are expected to attain a faster growth rate than the hardware and telecommunications sectors during the next three years.
According to Gartner, the IT economy in China is driven by large verticals, rather than by consumer IT spending. However, it is slowly evolving toward the consumer market. In 2010, the largest industries are manufacturing, financial services and government.
Demand from Chinese companies for emerging technologies such as SaaS, virtualisation, cloud computing, unified communications and green IT is low but rising, while IT vendors should help their channel partners continue to build skill sets around these emerging technologies, as spending on these technologies may help drive IT spending to 2013 and beyond, the research firm said.
Uko Tian, principal research analyst at Gartner, said: “The Chinese government’s focus on driving high levels of GDP growth will create favourable market conditions for the continued evolution of the IT industry in China.
“It has placed the development of the IT industry high on its list of priorities and stresses the wide applicability of IT in economic and social fields. The fixed-capital investment required is easier to obtain than other forms of financing.”
