According to a new forecast by Gartner, IT spending across the region is set to reach $169 billion in 2026 – an 8.9% increase from the current year. But beneath that headline figure lies a deeper story—one where artificial intelligence is no longer seen as futuristic, but foundational.
“The region isn’t waiting to catch up with the rest of the world—it’s leapfrogging,” said Mim Burt, Practice Vice President at Gartner. “CIOs here are not just investing in AI—they’re aligning entire business strategies around it.”
That alignment is reshaping how governments, enterprises and technology leaders think about infrastructure, talent and innovation.
Not just bigger budgets – smarter ones
Leading the way is spending on data centre systems, which, while slowing from a peak surge in 2025, is still forecast to grow by 37.3% in 2026 – reaching nearly $13 billion. Devices remain a significant slice of the IT pie, with spending expected to hit over $35 billion next year, up 7.4% from 2025.
Software is also gaining ground, with projected growth of 13.9%, pushing total spending in this category to more than $20 billion in 2026. IT services, meanwhile, are set to increase by 8.3%, totalling close to $37 billion. Even communications services, the most mature of the sectors, are expected to grow—albeit modestly – by just over 4%, reaching $63.5 billion.
Put together, total IT investment in MENA is projected to rise from $155 billion this year to just over $169 billion in 2026.
“This acceleration in data centre investment is being fuelled by the demand for generative AI and large-scale machine learning, which require vast compute power and robust infrastructure,” said Eyad Tachwali, Vice President, Advisory at Gartner. “The strongest demand is coming from hyperscalers, government entities, and AI-focused tech providers, rather than traditional enterprises.”
Governments and hyperscalers are leading the charge
While the private sector continues to modernise, it’s often the public sector and regional tech giants driving large-scale AI infrastructure. Much of the current momentum around generative AI – particularly in MENA – stems from national AI strategies, sovereign cloud initiatives, and investment in regionally trained large language models.
As a result, software spending is being reshaped to match this AI-first reality. Gartner expects that by 2028, three-quarters of all global software spending will go towards tools that have generative AI baked in. In the MENA region, this trend is already materialising.
“Providers are embedding GenAI into every layer of the software stack, from large language models to AI-as-a-service,” said Burt. “We’re also seeing experimentation with new pricing models that span both software and hardware ecosystems.”
The growing maturity of AI in the region is also pushing IT services to the forefront. As companies race to modernise legacy systems and integrate AI into workflows, they’re turning to services that can help them move faster and reduce complexity.
Tachwali added: “You can’t unlock real value from AI unless you have AI-literate teams and clear data strategies. That’s where the real edge lies.”
