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To reverse a years of damaging total factor productivity, regional labour market policy is moving from simple job development to managing active labor force transitions. Governments and companies are scaling short, modular training programmes and micro-credentials in information analytics and digital operations to gear up employees for emerging functions. Workplace-based learning and apprenticeship-style pathways are becoming more common as companies integrate AI tools into day-to-day workflows.
With oil prices anticipated to average $55-60 per barrel in 2026, local governments are magnifying their focus on expense discipline and private capital mobilisation. Fiscal policy is pivoting toward the monetisation of state-owned assets in logistics, energies, and desalination to redirect funds toward higher-impact financial investments. While borrowing via sukuk and sustainability-linked bonds is expected to increase to fund tactical deficits, the focus stays on enhancing non-oil earnings frameworks.
PwC Middle East financial policy and technique partner Jing Teow stated: "Having already mobilised capital and policy at scale, GCC governments are now concentrated on shipment. In 2026, the priority is enhancing financial durability through more safe and secure trade and investment relationships, efficient AI release, handled workforce shifts and disciplined fiscal policy in a more challenging 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 investment momentum, according to the newest ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is anticipated to outperform most worldwide areas peers next year, with local GDP forecast to grow by 4.4%. Throughout 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 technology and AI-related facilities.
Oil profits will be under pressure in the first half of 2026, production is expected to rise once again in the 2nd half of 2026, supporting the area's medium-term outlook, it specified. Saudi Arabia will stay a significant factor to GCC momentum, with GDP projection to grow 4.3% in 2026.
Growth will be supported by commercial growth and policy reforms, including reduced foreign ownership rules that aim to promote additional financial investment. The financial deficit is predicted to widen to 5.6% of GDP next year amid softer oil prices, while the current five-year lease freeze in Riyadh aims to ease inflationary pressures, though it may constrain future housing supply.
Strong domestic fundamentalsThe UAE is also placed for another strong year of efficiency, with GDP forecast to increase 5.6% in 2026 as non-oil sectors continue to expand. Tourist, trade and financial services stay crucial growth motorists, supported by population development and continual domestic need. Dubai's economy grew 4.4% in the very first half of 2025, showing broad-based non-oil strength.
Oil production is expected to get once again in the second half of 2026, complementing continuous financial investment in infrastructure, technology and global trade partnerships. Hanadi Khalife, the Head of Middle East, ICAEW, said: "This quarter's outlook enhances how far the GCC has can be found in building diverse, resilient and worldwide competitive economies.
Scott Livermore, ICAEW Economic Consultant, and Chief Economist and Handling Director, Oxford Economics Middle East, stated: "Saudi Arabia and the UAE are getting in 2026 with strong structures. Saudi non-oil activity is acquiring speed, supported by robust need and rising financial investment, even as financial pressures increase.""The UAE continues to take advantage of solid domestic fundamentals, a sharp uplift in federal government costs and sustained diversity efforts.
What Every Financier Needs To Know About Qatar's Legal ShiftWhat identifies 2026 from preceding years is not simply the velocity of technological modification, though that acceleration is genuine, but rather a fundamental shift in how enterprises envisage their GCCs' function. The is expected to grow to four hundred thirteen billion dollars by 2040, however this growth masks a more profound improvement.
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 behave like internal startups, agile, cross-functional, insight-driven, and deeply lined up with international organization results. This shift from execution to ownership represents possibly the single most significant tactical recalibration in the GCC model's development.
This week, we're assembling more than 3000 meetings in between investors and 119 Gulf-listed business with a combined worth of $2.4 trillion at the HSBC GCC Exchanges Conference 2026, in London. We're uniting financiers, business, exchanges, and policymakers to discuss what is changing in the region, and what comes next, including the growth and ongoing development of the Gulf's capital markets, and the region's growing function in global networks of capital and trade.
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