South Africa' financial, business and other services sector – the largest in the country, with more than 250 000 companies operating in this sector and 55 being in the Top 350 – accounts for more than 30% of the country's total ICT expenditure.
According to Lesley-Anne dos Santos, manager of the ICT vertical research programme, the trade sector – that includes retail, motor trade, repair services, wholesale trade, commercial agents, allied services, catering, accommodation and other trade – boasts more than 82 000 companies and accounts for just over 19% of total ICT spend.
Dos Santos adds: "Overall, many South African vertical sectors – including financial services, manufacturing and retail – are under major strain."
The manufacturing sector is currently lodged in a cyclical slowdown, as softer household demand and declining global growth are jointly contributing to lower activity in the sector.
Construction activity is infrastructure-driven, so has a certain level of security in the light of the government’s commitment to its infrastructure programme, and 2010 World Cup requirements, but some sectors are under pressure, especially the residential segment of the market, given the tight credit environment, low levels of consumer confidence and still relatively high household debt levels.
Dos Santos believes that the role that ICTs play in these sectors, especially during the economic downturn, must not be undervalued.
The trend in the trade sector is that companies are becoming more customer-centric and are focusing on increasing their customer base by a much larger degree through the use of technology.
Government spends less on ICT than the trade sector but contributes more to GDP due to the massive infrastructure projects taking place.
Having said all this, the 2010 FIFA World Cup has brought much needed investment into the country and is one of the drivers of economic growth. This event has already financially benefited many industries in South Africa including the construction, retail, financial services and the local service industries, including the huge investments into infrastructure and information communication technology.
Officially, the impact of the 2010 FIFA World Cup estimates is the creation of about 129 000 jobs, a contribution of around R21-billion to GDP, and around 350 000 visitors, but BMI-T analysts feel that these numbers are underestimated.