By Kate Yuan

(JW Insights) Aug 4 -- China's ICT (Information and Communication Technology) spending will exceed $720 billion by 2027, accounting for approximately 11.7% of the global market share, with a five-year compound annual growth rate (CAGR) of around 6.2%, according to a report by research firm IDC.

Despite the complex external environment, increased pressure on foreign trade, and inflation, China's ICT market is in a critical period of digital transformation and is expected to experience sustained growth over the next five years, the report said.

The global ICT spending was about $4.7 trillion last year and is projected to increase to $6.2 trillion by 2027, with a five-year CAGR of 5.7%. China's ICT spending surpassed $530 billion in 2022.

China's rapid economic growth and technological advancements in recent years have laid a solid foundation for the rapid development of the ICT market. In terms of industries, the financial industry, professional services, government, and manufacturing collectively account for over 50% of China's total ICT spending.

The securities and investment services, insurance, and banking sectors will have the highest year-on-year growth rates in ICT spending by 2027, said IDC.

It is expected that ICT spending in the manufacturing industry will continue to experience high growth over the next five years, with a five-year CAGR exceeding 11%. Manufacturing companies are increasingly investing in ICT to drive digitalization and intelligence in their operations, processes, and information.

Hardware spending has the largest market size, with spending expected to exceed $180 billion in 2027. In terms of software, enterprise software spending has the highest growth rate, with a projected five-year CAGR close to 20%. Additionally, software spending in China's enterprise ICT market is expected to exceed $100 billion by 2027, according to IDC.