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To reverse a decade of weakening overall factor efficiency, regional labour market policy is moving from easy task creation to handling active labor force transitions. Governments and employers are scaling short, modular training programs and micro-credentials in information analytics and digital operations to equip employees for emerging roles. Workplace-based knowing and apprenticeship-style pathways are becoming more typical as firms incorporate AI tools into daily workflows.
With oil prices forecasted to typical $55-60 per barrel in 2026, local governments are heightening their focus on expenditure discipline and personal capital mobilisation. Financial policy is pivoting towards the monetisation of state-owned possessions in logistics, utilities, and desalination to reroute funds towards higher-impact financial investments. While loaning through sukuk and sustainability-linked bonds is expected to increase to fund tactical deficits, the focus stays on strengthening non-oil revenue structures.
PwC Middle East economic policy and method partner Jing Teow said: "Having already mobilised capital and policy at scale, GCC governments are now focused on shipment. In 2026, the top priority is reinforcing economic durability through more protected trade and investment relationships, efficient AI implementation, handled labor force transitions and disciplined fiscal policy in a more difficult and fragmented international environment.".
Saudi Arabia and UAE are poised to lead the Gulf area's financial growth in 2026, supported by strong private-sector performance, durable domestic need and renewed investment momentum, according to the current ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is expected to outshine most international regions peers next year, with regional GDP projection to grow by 4.4%. Across the GCC, non-energy activity is predicted to broaden by 4.1% in 2026, driven by strong labour markets, improving credit conditions and rising investment in innovation and AI-related facilities.
Oil revenues will be under pressure in the very first half of 2026, production is anticipated to increase once again in the second half of 2026, supporting the region's medium-term outlook, it mentioned. Saudi Arabia will stay a major contributor to GCC momentum, with GDP projection to grow 4.3% in 2026.
Growth will be supported by industrial expansion and policy reforms, including alleviated foreign ownership guidelines that aim to stimulate additional financial investment. The financial deficit is projected to broaden to 5.6% of GDP next year amidst softer oil costs, while the current five-year lease freeze in Riyadh intends to reduce inflationary pressures, though it may constrain future real estate supply.
Strong domestic fundamentalsThe UAE is also placed for another strong year of performance, with GDP projection to increase 5.6% in 2026 as non-oil sectors continue to broaden. Tourism, trade and financial services remain key growth chauffeurs, supported by population development and continual domestic need. Dubai's economy grew 4.4% in the first half of 2025, reflecting broad-based non-oil strength.
Oil production is expected to pick up once again in the 2nd half of 2026, complementing continuous investment in infrastructure, technology and global trade collaborations. Hanadi Khalife, the Head of Middle East, ICAEW, said: "This quarter's outlook strengthens how far the GCC has actually can be found in structure varied, resilient and internationally competitive economies.
Navigating the Next Middle East Business EnvironmentScott Livermore, ICAEW Economic Consultant, and Chief Economic Expert and Managing Director, Oxford Economics Middle East, said: "Saudi Arabia and the UAE are getting in 2026 with strong structures. Saudi non-oil activity is acquiring rate, supported by robust need and increasing investment, even as financial pressures increase.""The UAE continues to take advantage of solid domestic fundamentals, a sharp uplift in government spending and continual diversity efforts.
Essential Insights From Latest Regional Market Research ReportsWhat identifies 2026 from preceding years is not just the velocity of technological change, though that velocity is real, however rather an essential shift in how business conceive of their GCCs' function. The is expected to grow to 4 hundred thirteen billion dollars by 2040, however this growth masks a more extensive change.
Rather, they ask whether these centers drive development, own profit-and-loss responsibility, and contribute to competitive distinction. In 2026, the most successful GCCs will act like internal start-ups, agile, cross-functional, insight-driven, and deeply aligned with global service outcomes. This shift from execution to ownership represents perhaps the single most considerable strategic recalibration in the GCC model's development.
Today, we're convening more than 3000 conferences in between financiers and 119 Gulf-listed companies with a combined worth of $2.4 trillion at the HSBC GCC Exchanges Conference 2026, in London. We're bringing together investors, companies, exchanges, and policymakers to discuss what is altering in the region, and what follows, including the expansion and continuous advancement of the Gulf's capital markets, and the area's growing function in global networks of capital and trade.
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