Iraq ICT Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Iraq ICT Market Trends and Insights

Accelerating Digital Transformation Programs

The Prime-Minister-level Business Environment Reforms Higher Committee steers coordinated e-government rollouts that include one-stop company registration, digital tax filing, and GIS-based permit systems, each triggering immediate software and integration contracts. Ministries must hook ISP DNS traffic to government infrastructure, anchoring procurement of secure DNS, API gateways, and identity-access platforms. UNICEF’s deployment of EMIS across 4,514 schools illustrates how public-sector demand scales hardware, analytics, and cloud workloads . Collectively these initiatives catalyze double-digit software and services growth within the Iraq ICT market.

5G and Fiber Backhaul Rollout

Iraq’s fourth international submarine cable and Cisco’s contract to rebuild the national backbone extend low-latency transit to Turkey and the Gulf, spurring telcos to densify metro fiber rings for 5G backhaul. The Development Road corridor will require autonomous-vehicle-ready connectivity, implying fiber trenching beyond urban zones. Private carrier FiberX is hiring FTTH engineers across Basra and Baghdad, confirming field-level acceleration. These investments make bandwidth accessible and push the Iraq ICT market toward cloud-native applications.

Demand for Managed Security and SOC Services

February 2024 sabotage of eastern Baghdad fiber cables affecting 40,000 users exposed security gaps and elevated SOC spending priorities among banks, oil firms, and ministries. Domestic players Diyar, STS, and Cyber Code scale real-time monitoring, threat intelligence, and compliance-oriented encryption, meeting governance requirements. Regional cybersecurity spending rises at 14.5% CAGR, enabling knowledge transfer partnerships that enrich local offerings.

Hyperscale and Colocation Data-Center Deals

Baghdad and Erbil attract hyperscalers seeking transit diversity and growth white space. The National Data Center already houses multiple government workloads, while private hosts negotiate power-purchase agreements and redundant grid feeds to mitigate electricity risk. New colocation capacity pulls global CDNs and financial-market platforms into Iraq, enlarging the Iraq ICT market footprint and diversifying revenue beyond connectivity resale.

Persistent Grid and Power-Supply Instability

Average Baghdad households receive fewer than 15 electricity hours daily during peak summer, forcing ISPs and data centers to run diesel gensets that raise total cost of ownership and carbon footprint. Power volatility deters hyperscalers from building Tier III facilities and obliges enterprises to locate critical workloads in hybrid arrangements. Renewable adoption through Law 53/2017 remains nascent, making energy resilience a gating factor for wider Iraq ICT market expansion.

Currency and Import-License Volatility

Central-bank foreign-currency auctions fluctuate, exposing device distributors to margin swings and delaying large-volume shipments of servers, switches, and smartphones. Import-license approvals can stretch two months and force integrators to carry buffer stock, tying up working capital. This friction channels demand toward SaaS and managed services, shifting Iraq ICT market composition away from capex-heavy hardware.

Segment Analysis

By Type: Communication Services Lead Digital Infrastructure Expansion

Communication Services accounted for 37.26% of Iraq ICT market share in 2024 on the strength of national fiber and mobile upgrades. EarthLink alone has installed 800 fiber-distribution terminals that can serve 600,000 households when fully activated. The Iraq ICT market size for Cloud Services is projected to accelerate at 8.57% CAGR as ministries and oil majors migrate ERP, HR, and analytics workloads into regional data centers. IT Services revenue grows steadily, tied to managed network and help-desk outsourcing that alleviates the local talent gap.

Currency-driven price spikes constrain IT Hardware but networking kits enjoy countercyclical demand thanks to 5G build-outs. Mandatory mobile device registration platforms and esports streaming apps spur specialized software spending. Cybersecurity suites and resilient DC infrastructure earn priority funding to counter sabotage risks, bolstering IT Security and IT Infrastructure lines within the Iraq ICT market.

Note: Segment shares of all individual segments available upon report purchase

By Enterprise Size: SMEs Accelerate Cloud Adoption

Large enterprises captured 62.86% Iraq ICT market share in 2024 due to multi-year government and oil contracts. However the Iraq ICT market size attributed to SMEs is expanding at an 8.41% CAGR as subscription-based ERP and SaaS pricing lowers entry barriers. Local vendor Ejaftech claims 800 clients across 1,900 projects, evidencing latent demand for Arabic-interface accounting and HR modules.

Empire World’s award-winning SAP deployment in Erbil highlights big-enterprise sophistication and showcases hybrid ERP architectures that integrate on-premise OT data with cloud analytics. SMEs gravitate toward cloud to sidestep hardware imports and to access enterprise-grade security bundles delivered via managed service providers. This behavioral shift reinforces competitive dynamics and enriches the Iraq ICT market.

By Deployment Model: Hybrid Architectures Gain Momentum

On-premise solutions retained 53.71% share in 2024 because ministries and oil operators adhere to data-sovereignty rules. Even so the cloud slice of the Iraq ICT market size will outpace at 9.07% CAGR as Oracle Cloud Infrastructure and AWS regional outposts answer compliance demands. Hybrid patterns gain traction, placing SCADA and critical data on-site while moving CX, analytics, and DR workloads into the cloud.

Areeba’s use of Oracle Cloud for payment processing illustrates compliance-ready cloud rollouts that win central-bank approval. SMEs rely almost exclusively on SaaS ERP, whereas integrated oil companies employ hybrid Hadoop clusters to crunch seismic data while adhering to national data-residency statutes. This convergence cements hybrid as the de facto architecture guiding Iraq ICT market growth.

Note: Segment shares of all individual segments available upon report purchase

By End-User Industry Vertical: Gaming Emerges as Growth Leader

Government and Public Administration commanded 25.84% Iraq ICT market share in 2024 on back of e-visa, land registry, and tax digitization projects. Conversely Gaming and Esports will log the fastest CAGR at 9.12% through 2030, propelled by ubiquitous 4G, anticipated 5G, and a median age under 22 years. Huawei’s 38,000-participant gaming tournament underscored monetization potential and attracted CDN and cloud-streaming investments.

In BFSI digitization of payments and neobanking apps, including fintechs featured on Forbes MENA, stimulates cybersecurity, core-banking, and AML analytics deals. Energy and Utilities modernize OT stacks around IoT, ML, and edge compute for pipeline integrity, while Retail and Logistics adopt e-commerce platforms spurred by Pure Platform’s licensing milestone. Healthcare projects funded by UNICEF roll out digital immunization records, validating telehealth and EMR demand and further diversifying the Iraq ICT market.

Geography Analysis

Baghdad anchors the Iraq ICT market with the National Data Center, telco headquarters, and the highest mobile-phone penetration at 97%. EarthLink serves 60% of national internet users from Baghdad, ensuring the city’s primacy in bandwidth and software uptak. Government SaaS procurement and SOC contracts cluster here, while multinational oil firms locate IT-OT command centers that demand redundant fiber paths and micro-segmented security.

Erbil leads the Kurdistan Regional Government zone, benefiting from earlier 4G rollout and competitive fixed-line markets via Newroz Telecom and FastLink. Separate investment codes streamline foreign ICT entry, which sustains enterprise-system deployments and data-center colocation. Summer grid deficits trigger sales of UPS, rectifiers, and power-efficient servers, shaping localized product portfolios and service-level agreements suited to KRG realities.

Basra and adjoining governorates form the southern growth axis tied to oilfield digitization and port modernization. FiberX extends FTTH and metro-ethernet links to Basra, Kut, and Karbala to meet IOC latency and uptime demands. Grand Al Faw port and the Development Road corridor will need intelligent logistics, customs clearance, and computer-vision security, injecting fresh opportunities into the Iraq ICT market while addressing regional disparities where Wasit clocks only 72% mobile-phone usage.