Middle East and Africa Smart City Market Research Report 2023

Middle East and Africa Smart City Market Synopsis

Middle East and Africa Smart City Market Size Was Valued at USD 140.21 Billion in 2022, and is Projected to Reach USD 225.17 Billion by 2030, Growing at a CAGR of 6.1% From 2023-2030.

A Smart City is an urban environment that leverages advanced technologies to enhance the quality of life for its residents and improve overall efficiency in various aspects of city management. It integrates information and communication technology (ICT), data analytics, and the Internet of Things (IoT) to optimize infrastructure, services, and communication.

• In the Middle East, cities like Dubai and Doha have been at the forefront of adopting smart city initiatives, leveraging technologies such as IoT (Internet of Things), AI (Artificial Intelligence), and data analytics to optimize services like transportation, energy management, and public safety. These cities aim to create more sustainable and efficient urban environments.
• In Africa, smart city developments are gaining momentum, with cities like Cape Town, Nairobi, and Lagos embracing digital innovations. The focus is on leveraging technology to address issues such as traffic congestion, water and energy management, and the provision of public services.
• The Smart City market in the Middle East and Africa is driven by a combination of public and private sector investments, collaborations, and initiatives. Governments are working towards creating regulatory frameworks that support the adoption of smart technologies, while technology companies are actively involved in deploying solutions for smart infrastructure.
• The given graph shows that the Wireless was the largest consumer IoT market type in the Middle East and Africa region as of 2022. That year, the market value of consumer IoT in that region was 5.6 billion U.S. dollars. The Internet of Things (IoT) has revolutionized consumer lifestyles, prompting companies to integrate sensors and features into their products to enhance user experience, resource management, and product control. Advanced home appliances and wearable devices are driving market growth, with IoT technology facilitating data sharing via microcontrollers and wireless technologies. IoT wearable devices have become common in healthcare and sports, monitoring vital signs and enhancing industry statistics.

Top Key Players:

Etisalat Digital, Huawei Technologies, Orange Business Services, Schneider Electric, Microsoft Azure, SAP, Mastercard Labs for Financial Technology, IHS Markit, SWVL, Careem, Dubai Roads & Transport Authority, Hyperloop One, Masdar, Enel X, Veolia, Green Climate Fund, Accenture, Cisco Systems, Siemens,Orascom Construction PLC

Middle East and Africa Smart City Market Trend Analysis

Rapid Urbanization and population growth

• Smart city initiatives leverage advanced technologies such as Internet of Things (IoT), artificial intelligence, and data analytics to optimize urban services, including transportation, energy, healthcare, and public safety. The MEA region recognizes the potential of smart city solutions to improve efficiency, sustainability, and the overall well-being of its growing urban population.
• The development of smart cities in the MEA region is characterized by collaborative efforts between governments, private sectors, and technology providers. Investments in smart infrastructure and digital innovations play a crucial role in transforming cities into technologically advanced and interconnected hubs. This trend is not only addressing current urban challenges but also positioning the Middle East and Africa as key players in the global smart city landscape, with the potential to become models for sustainable and efficient urban development.

Developing intelligent transportation systems creates an Opportunity

• The Middle East and Africa present a significant opportunity for the development of Intelligent Transportation Systems (ITS) within the context of Smart City initiatives. As urbanization accelerates across the region, the demand for efficient and sustainable transportation solutions becomes paramount. ITS leverages advanced technologies, such as sensors, data analytics, and connectivity, to optimize transportation networks.
• The focus on ITS is driven by the need to address traffic congestion, enhance public safety, and reduce environmental impact. Governments and municipalities are increasingly recognizing the potential of integrating smart technologies into their transportation infrastructure to create more liveable and connected cities.
• Key components of ITS, such as real-time traffic monitoring, smart parking solutions, and intelligent traffic management systems, can significantly improve the overall transportation ecosystem. The integration of smart mobility solutions not only enhances the quality of life for residents but also attracts investment and supports economic growth.

Middle East and Africa Smart City Market Segment Analysis:

Middle East and Africa Smart City Market Segmented on the basis of Component and Functional Area.

By Component, Hardware segment is expected to dominate the market during the forecast period

• The dominance of the Hardware segment can be attributed to the foundational role it plays in enabling various smart city functionalities. Smart cities heavily rely on a robust and interconnected hardware ecosystem to collect and process data efficiently. Sensors and IoT devices deployed across urban landscapes facilitate the acquisition of real-time data related to traffic flow, energy consumption, waste management, and other crucial parameters.
• Governments and urban planners in the MEA region are increasingly investing in the development and deployment of hardware infrastructure to enhance urban living standards, optimize resource utilization, and address various challenges faced by growing metropolitan areas. The hardware components serve as the physical interface that supports the implementation of smart solutions, making them integral to the overall success of smart city initiatives in the Middle East and Africa. As the region continues to embrace digital transformation, the Hardware segment is poised to play a pivotal role in shaping the smart city landscape and driving sustainable urban development.

 By Functional Area, Smart Mobility segment held the largest share of 40% in 2022

• Smart Mobility plays a pivotal role in transforming urban landscapes by leveraging innovative technologies to enhance transportation systems, reduce congestion, and improve overall efficiency. As urbanization accelerates across the region, governments and municipalities are increasingly investing in smart solutions to address the growing challenges of transportation and mobility.
• The dominance of Smart Mobility in the MEA Smart City market can be attributed to several factors. The rising population in urban areas has led to increased demand for efficient and sustainable transportation solutions. Smart Mobility initiatives incorporate technologies such as intelligent transportation systems, smart parking, and connected vehicles to optimize traffic flow and reduce commuting time.
• Governments in the MEA region are recognizing the potential economic and environmental benefits of adopting Smart Mobility solutions. These include reduced carbon emissions, improved air quality, and enhanced economic productivity through streamlined transportation networks.
• Furthermore, strategic partnerships between governments, technology providers, and the private sector are driving the deployment of Smart Mobility projects. Investments in infrastructure, digital connectivity, and data analytics are creating a conducive environment for the growth of the Smart Mobility segment in the MEA Smart City market.

Middle East and Africa Smart City Market Regional Insights:

United Arab Emirates is Expected to Dominate the Market Over the Forecast period

• The United Arab Emirates (UAE) is poised to dominate the Middle East and Africa Smart City Market, reflecting its commitment to innovation and technological advancement. With visionary leadership and substantial investments in smart infrastructure, the UAE has emerged as a regional leader in developing smart cities.
• Cities such as Dubai and Abu Dhabi showcase cutting-edge technologies in areas like transportation, energy management, healthcare, and public services. The implementation of Internet of Things (IoT) solutions, data analytics, and artificial intelligence has played a pivotal role in transforming these cities into intelligent urban hubs.
• The UAE's smart city initiatives focus on enhancing sustainability, efficiency, and the overall quality of life for residents. These efforts have positioned the country as a benchmark for smart city development in the broader Middle East and Africa region. The integration of advanced technologies, including smart grids, intelligent transportation systems, and digital governance, has catalysed economic growth and positioned the UAE as a hub for innovation.

Middle East and Africa Smart City Market Top Key Players:

• Etisalat Digital
• Huawei Technologies
• Orange Business Services
• Schneider Electric
• Microsoft Azure
• SAP
• Mastercard Labs for Financial Technology
• IHS Markit
• SWVL
• Careem
• Dubai Roads & Transport Authority
• Hyperloop One
• Masdar
• Enel X
• Veolia
• Green Climate Fund
• Accenture
• Cisco Systems
• Siemens
• Orascom Construction PLC

 Key Industry Developments in the Middle East and Africa Smart City Market:

• In January 2023, Siemens acquired Enlighted, a leading provider of smart building technology, to strengthen its smart city offerings.
• In April 2023, Microsoft unveiled its Azure Digital Twins platform, enabling cities to create virtual representations of their physical infrastructure for data-driven decision making.

Middle East and Africa Smart City Market Scope: