THE CYPRIOT IT MARKET 2001
Cyprus IT Market Moves Steadily Upwards
The impendent entrance of Cyprus in EU is expected to ensure a steadily developing business environment, with clear benefits for Information Technologies too. The total IT market moved upwards, in 2001 with a value of 192 εκ. US$, according to Strategic International/K.Kataras S.A. forecasts, while in 2003 will approach about 260 mil. US$. In addition to the high growth of GDP (steadily over 4%) and the low inflation, these conditions are in favour of the continuing development of IT sector in the immediate future.
by Mrs. Natassa Samourkasidou (*)
The Cypriot IT Market, in 2000, was unique as long as there was a remarkable growth in the area of Services. The conditions seem to mature and the PCs market presented a higher growth than the expected, helping consequently all the sectors that depend on it like the education, the networking, the peripherals, the printers, etc.
In combination with the forecasts for a continuing growth of fundamental sizes of Cypriot IT market, plus the already high expenditure per capita in Information Technologies, 145 $ in 2000, the growth rates are expected to go slower the next years with a medium term stabilization a little bit more than 15%.
As happened in the past, the PC sales were the biggest source of revenues for the Cypriot IT. This trend is expected to continue in the future as long as the PC penetration, especially in the business sector, is lower compared to Western Europe. The segment of software is foreseen to grow its value in a more rapid way than the total market, given the still low penetration of ERP and CRM such as the least network applications that have developed for companies.
IT Market as (%) in GDP, 2000
Source: Strategic International/K.Kataras SA
A very important factor for the software market size, which is expected to overcome 60 mil. US$ in 2003, with an average growth rate about 25%, is the acceptance of ASP (Application Service Provider) model for many kinds of new applications. If this model is successful, is going to create many new accounts for this area.
The IT Services are going to move upwards of the average of the total market, while is expected to grow especially the Support Services, given the establishment of large scale information systems from the part of government and the banks.
According to European Union, "eEurope 2005" Action Plan will provide fresh impetus to the drive towards an information society emphasizing on 3G mobile communications, the widespread availability of broadband access at competitive prices, digital television and the promotion of e-commerce and e-business.
In addition, the EU ministers of telecommunications and the information society are going to make arrangements for the monitoring of national and European regulatory initiatives that impact on e-commerce, and identify factors that prevent enterprises maximizing the potential of information and communication technologies (ICT) for their business.
Cypriot IT Market per segment, 1999 - 2001 (mil. ?)
Source: Strategic International/ K. Kataras S.A.
They also called for moves to strengthen European leadership in the information society by including an international dimension in eEurope 2005 which is an extended action plan.
So, Cyprus is going to benefit from the exchange of best practices brought about by the abovementioned action plan.
(*) Natassa Samourkasidou
Analyst, Strategic International S.A.