While total spending on technology by companies across APAC will continue to grow, cost pressures - from software inflation, hardware spikes, regulatory fragmentation, tariffs, energy shocks, uneven regional growth, and talent shortages - will reduce the impact of their investment.
Forrester’s Asia Pacific Tech Market Forecast from 2026 to 2030 said the region will spend over US$437 billion (S$561 billion) on acquiring new technology with spending on technology growing by 9.3 percent, driven by investments in software, services, communications equipment, and tech outsourcing.
“Asia Pacific’s technology spending momentum remains strong, but the headline growth numbers mask a more complex reality,” said Frederic Giron, VP and senior research director at Forrester.
“CIOs across the region are grappling with software inflation, hardware volatility, and increasing regulatory divergence that directly impact modernisation plans. The conflict in the Middle East adds a new macro headwind - sustained energy cost inflation will compress GDP growth across oil-dependent countries in Asia,” he added.
Giron said CIOs should expect IT budgets to come under pressure if the conflict lengthens. To navigate this environment, leaders must shift to highly targeted investments - prioritising automation, AI-enhanced platforms, and modernisation initiatives that deliver measurable productivity gains.
The region’s digital economy has shifted from user acquisition to monetisation, with digital services income reaching US$11 billion in 2024 - 2.5x higher than in 2022. Cross-border QR payment interoperability is accelerating financial digitisation, while Industry 4.0 adoption continues to scale across Indonesia, Vietnam, and Thailand.
Forrester’s report cited cost inflation as a key factor that will define the real value of that growth. It advised CIOs to go beyond headline numbers to see where demand is expanding, where regulatory and geopolitical shifts will redirect investment, and where macroeconomic uncertainty will slow transformation.
Crucially, Forrester said CIOs need to recognise the dynamics shaping tech spending in 2026 and beyond, and understand not just where growth is heading, but what could hold it back, in their IT investments and strategy planning.
As an example, Forrester recommends that CIOs should expand their investments in infrastructure and digital capabilities in growth markets like India and Indonesia; while mature markets should focus on extracting efficiency from existing assets through automation and optimisation.
2026 IT spending highlights across APAC markets
Forrester projection of tech spend growth across key countries in the Asia Pacific:
• Among the larger markets, China’s will grow by 10.7 percent, with AI infrastructure spending exceeding US$70 billion this year, fueled by major investments from Alibaba and ByteDance as well as the Ministry of Industry and Information Technology’s industrial digitalisation mandate. Data centre and cloud platform buildout remain strong, but weak domestic demand and deflationary pressures will slow traditional enterprise IT spending.
• India will grow 13.4 percent this year, propelled by rapid cloud adoption and data localisation rules that are driving major onshore infrastructure investment. Software investment is also rising as vendors embed AI capabilities into renewal pricing, while domestic enterprise demand continues to be the primary driver of India’s double-digit tech spending growth.
• Australia’s tech spending is forecast to grow 8.6 percent and reach nearly US$70.6 million, outpacing the country’s projected 2.2 percent GDP growth. Software prices are rising at nearly five times general inflation as vendors embed AI capabilities into contract renewals.
• Elsewhere, IT spending in Southeast Asia remains strong in 2026, with Vietnam growing highest at 15.4 percent, followed by 12.5 percent in Indonesia, 12.3 percent in the Philippines, 9.5 percent in Malaysia, 6.8 percent in Thailand and 6 percent in Singapore.
• Singapore’s growth is anchored to strong investment in AI transformation and hyperscaler expansion, but a significant talent shortage remains the main constraint on technology adoption as many employers continue to lag in developing their AI workforce.
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