IT Spending in Slovakia Will Return to Growth in the Coming Years
In 2011, the IT market in Slovakia declined 1.7 % year on year in constant U.S. dollar terms to $1.83 billion, as a result of the turbulent economic climate surrounding the European sovereign debt crisis. IDC expects the IT market in Slovakia to expand 5.3% year on year in 2012 and then to grow at a compound annual growth rate (CAGR) of 6.2% over the next five years.
"The Slovak economy performed surprisingly well in 2011, despite the unfavorable economic conditions. The country achieved 3.4% growth of GDP on the strength of its automotive industry and a healthy finance sector. This helped to counterbalance the budget consolidation in the public sector and avoid deeper IT market contraction," says Senior Research Analyst Milan Kalal with IDC CEMA.
Key findings of IDC's analysis of the Slovak IT market include:
The infrastructure services vertical market, which includes transport, communications, and utilities, maintained its leading position in terms of IT spending in Slovakia in 2011. The other top verticals in terms of IT investments were the public sector, manufacturing, and finance. Together, these markets accounted for 70% of IT spending in the country last year.
Organizations in the combined manufacturing vertical spent $260.55 million on IT in 2011, accounting for 14.2% of the market. Manufacturers in Slovakia had a solid year based on the strength of the automotive industry, with investments shifting form hardware to software and IT services.
The largest-spending individual sector on the Slovak IT market, government, spent $259.30 million on IT in 2011 and contributed 14.2% of the total market spending. However, IT spending in the government sector declined moderately year on year amid pressure from the European Union (EU) to consolidate expenditures.
"Another key factor to influence changes in 2011 IT spending in Slovakia was the boom in smartphones, along with media tablets, both as alternatives to feature phones and traditional PCs," explains Kalal. "It was an extremely successful year for the expansion of mobile devices, with sales of media tablets surging more than six fold, and smartphone sales growing by 27% year on year."
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