Governments throughout the Middle East and Africa (MEA) region are investing hugely in AI. Generative AI is one of the most revolutionary applications of AI technology, which has already impressed with its versatility and adaptability.

According to a recent report by International Data Corporation, investment in AI in the MEA will increase to $3 billion this year, making up about 2% of the $151.4 billion in total global AI spending.

The US-based research firm noted that MEA’s AI investment will soar at a compound annual growth rate of 29.7% to reach $6.4 billion in 2026, representing the fastest growth rate in the world.

Further, AI expenditure will increase over the next several years due to businesses’ adoption of cloud solutions and digital transformation, the report added.

“Organizations across the region are investing in AI technologies and related software and services to drive greater efficiency through automation and contribute to a more agile operating environment,” said Manish Ranjan, senior program manager for software, cloud, and IT services at IDC for the MEA.

“The effects of the pandemic have fuelled further spending in relation to AI/ML [machine learning] adoption, particularly within the banking and finance, manufacturing, trade, health care, and government verticals,” Ranjan added.

According to IDC, Almost 44% of the region’s overall AI spending this year will be split across banking, retail, and the federal government, followed by manufacturing.

According to IDC’s predictions, the fastest-growing industries in terms of AI spending will be professional services and transportation, with annual growth rates of 36.4% and 33.9%, respectively, between 2022 and 2026. However, more qualified experts will be required in the region to use the technology.

Meanwhile, the worldwide AI industry is expected to reach $1.7 trillion in 2030, up from $93.5 billion in 2021, growing at a CAGR of more than 38%.