17 Mar 2020
New IDC Report Explores Impact of COVID-19 Outbreak on Middle East & Africa Smartphone Market
Dubai – As the global COVID-19 outbreak, which was officially declared a pandemic last week by the World Health Organization (WHO), continues to severely impact economies around the world, International Data Corporation (IDC) has revised its forecast for the Middle East and Africa (MEA) smartphone market in 2020 downwards, with shipments now expected to decline marginally year on year.
As per the most recent WHO Situation Report (#56), there are now 167,511 confirmed cases of the virus worldwide, with 6,606 deaths. In response to the pandemic, IDC has developed three possible scenarios – Optimistic, Probabilistic, and Pessimistic – and analyzes their potential impact in a newly published report titled 'Worldwide and MEA Smartphone Markets: Scenario Assessment of COVID-19's Impact'. Under the Probabilistic scenario, IDC's forecast for year-on-year smartphone shipment growth across the MEA region in 2020 has been brought down from +2.4% to -0.4%.
"It is IDC's current opinion that the Probabilistic scenario, as published in the Q4 2019 edition of IDC's Quarterly Mobile Phone Tracker, is still the most likely to occur, with both supply- and demand-side concerns alleviating by the second half of 2020," says Nabila Popal, a senior research manager at IDC. "However, day by day, the Pessimistic scenario is becoming an increasing possibility as stock markets around the world plunge into a tailspin and day-to-day life is disrupted in major countries globally, and closer to home in the GCC and Iran. Even in the most optimistic of recoveries, the massive disruption that COVID-19 has already caused to supply chains and business operations will permanently alter how companies operate once the dust settles."
With the exception of Iran, when looking at other regions globally, the MEA region has comparatively few COVID-19 cases, although uncertainty around the pandemic is now impacting the daily lives of consumers across the region. As such, IDC believes that the major challenge for the MEA smartphone market remains supply chain and production constraints in China, as these are heavily impacting the flow of mobile phone shipments into the region. Demand for smartphones has not yet been heavily interrupted, but unless the spread of the virus slows down, consumer demand will no doubt decline in the short term.
"It is important to keep in mind that this is a very fluid situation with facts and figures changing by the hour," says Ramazan Yavuz, a senior research manager at IDC. "No matter the scenario, COVID-19's ripple effect will impact all industries and economies globally. This humanitarian crisis will likely reshape many markets and industries in 2020. The ultimate impact of the outbreak will be determined by the trajectory of the virus going forward, how fast countries across MEA (and the rest of the world) react to contain the outbreak, how fast Chinese supply chains can adapt to operating at sub-optimal levels for at least the next three months, and how soon they can return to 100% capacity."
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International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC.
IDC in the Middle East, Turkey, and Africa
For the Middle East, Turkey, and Africa region, IDC retains a coordinated network of offices in Riyadh, Nairobi, Lagos, Johannesburg, Cairo, and Istanbul, with a regional center in Dubai. Our coverage couples local insight with an international perspective to provide a comprehensive understanding of markets in these dynamic regions. Our market intelligence services are unparalleled in depth, consistency, scope, and accuracy. IDC Middle East, Africa, and Turkey currently fields over 130 analysts, consultants, and conference associates across the region. To learn more about IDC MEA, please visit www.idc.com/mea. You can follow IDC MEA on Twitter at @IDCMEA.
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