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To reverse a years of weakening overall factor productivity, regional labour market policy is moving from basic task production to managing active labor force transitions. Governments and employers are scaling short, modular training programs and micro-credentials in data analytics and digital operations to equip employees for emerging roles. Workplace-based knowing and apprenticeship-style paths are ending up being more typical as firms incorporate AI tools into day-to-day workflows.
With oil rates forecasted to average $55-60 per barrel in 2026, local governments are heightening their concentrate on expense discipline and private capital mobilisation. Financial policy is rotating towards the monetisation of state-owned properties in logistics, utilities, and desalination to reroute funds toward higher-impact financial investments. While loaning via sukuk and sustainability-linked bonds is expected to increase to money tactical deficits, the focus remains on enhancing non-oil earnings frameworks.
PwC Middle East economic policy and technique partner Jing Teow said: "Having currently mobilised capital and policy at scale, GCC federal governments are now concentrated on delivery. In 2026, the concern is strengthening economic resilience through more secure trade and financial investment relationships, reliable AI release, handled workforce transitions and disciplined financial policy in a more tough and fragmented global environment.".
Saudi Arabia and UAE are poised to lead the Gulf area's economic growth in 2026, supported by strong private-sector performance, durable domestic need and restored financial investment momentum, according to the most recent ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is expected to surpass most global regions peers next year, with regional GDP projection to grow by 4.4%. Throughout the GCC, non-energy activity is forecasted to expand by 4.1% in 2026, driven by strong labour markets, improving credit conditions and increasing financial investment in innovation and AI-related infrastructure.
Although oil earnings will be under pressure in the first half of 2026, production is expected to rise again in the 2nd half of 2026, supporting the region's medium-term outlook, it specified. Saudi Arabia will stay a significant contributor to GCC momentum, with GDP forecast to grow 4.3% in 2026.
Growth will be supported by commercial growth and policy reforms, including eased foreign ownership guidelines that intend to promote further financial investment. The fiscal deficit is forecasted to broaden to 5.6% of GDP next year amidst softer oil rates, while the current five-year lease freeze in Riyadh aims to reduce inflationary pressures, though it might constrain future housing supply.
Strong domestic fundamentalsThe UAE is likewise positioned for another strong year of efficiency, with GDP projection to increase 5.6% in 2026 as non-oil sectors continue to broaden. Tourism, trade and monetary services remain crucial growth drivers, supported by population growth and continual domestic demand. Dubai's economy grew 4.4% in the very first half of 2025, showing broad-based non-oil strength.
Oil production is expected to pick up once again in the 2nd half of 2026, matching ongoing investment in facilities, technology and global trade partnerships. Hanadi Khalife, the Head of Middle East, ICAEW, stated: "This quarter's outlook reinforces how far the GCC has come in structure varied, durable and globally competitive economies.
Scott Livermore, ICAEW Economic Advisor, and Chief Financial Expert and Handling Director, Oxford Economics Middle East, said: "Saudi Arabia and the UAE are getting in 2026 with strong structures. Saudi non-oil activity is acquiring speed, supported by robust need and increasing investment, even as financial pressures increase.""The UAE continues to take advantage of solid domestic principles, a sharp uplift in government spending and sustained diversity efforts.
Driving Dubai Industrial Growth through Strategic ExcellenceWhat distinguishes 2026 from preceding years is not merely the acceleration of technological modification, though that acceleration is genuine, however rather a basic shift in how enterprises envisage their GCCs' purpose. The is expected to grow to 4 hundred thirteen billion dollars by 2040, however this development masks a more extensive improvement.
Rather, they ask whether these centers drive innovation, own profit-and-loss obligation, and contribute to competitive distinction. In 2026, the most successful GCCs will act like internal start-ups, nimble, cross-functional, insight-driven, and deeply lined up with worldwide organization results. This shift from execution to ownership represents perhaps the single most substantial strategic recalibration in the GCC model's development.
This week, we're assembling more than 3000 meetings between investors and 119 Gulf-listed companies with a combined value of $2.4 trillion at the HSBC GCC Exchanges Conference 2026, in London. We're combining investors, business, exchanges, and policymakers to discuss what is changing in the area, and what comes next, consisting of the growth and ongoing advancement of the Gulf's capital markets, and the region's growing role in global networks of capital and trade.
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