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To reverse a decade of deteriorating overall factor efficiency, local labour market policy is moving from basic task development to handling active workforce shifts. Governments and companies are scaling short, modular training programs and micro-credentials in data analytics and digital operations to equip workers for emerging functions. Workplace-based knowing and apprenticeship-style paths are ending up being more typical as companies integrate AI tools into day-to-day workflows.
With oil costs forecasted to average $55-60 per barrel in 2026, local federal governments are intensifying their focus on expense discipline and personal capital mobilisation. Fiscal policy is pivoting toward the monetisation of state-owned assets in logistics, utilities, and desalination to redirect funds toward higher-impact financial investments. While borrowing via sukuk and sustainability-linked bonds is expected to increase to money strategic deficits, the focus stays on reinforcing non-oil profits frameworks.
PwC Middle East financial policy and technique partner Jing Teow stated: "Having already mobilised capital and policy at scale, GCC federal governments are now concentrated on delivery. In 2026, the top priority is strengthening financial strength through more safe trade and investment relationships, effective AI release, handled workforce shifts and disciplined fiscal policy in a more tough and fragmented global environment.".

Saudi Arabia and UAE are poised to lead the Gulf region's financial expansion in 2026, supported by strong private-sector efficiency, durable domestic demand and restored financial investment momentum, according to the latest ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is anticipated to outperform most international regions peers next year, with local GDP forecast 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, enhancing credit conditions and increasing investment in innovation and AI-related infrastructure.
Although oil incomes will be under pressure in the very first half of 2026, production is anticipated to rise again in the 2nd half of 2026, supporting the area's medium-term outlook, it stated. Saudi Arabia will remain a major contributor to GCC momentum, with GDP projection to grow 4.3% in 2026.

Development will be supported by industrial expansion and policy reforms, consisting of relieved foreign ownership guidelines that aim to stimulate additional investment. The financial deficit is projected to expand to 5.6% of GDP next year amidst softer oil rates, while the recent 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 positioned for another strong year of performance, with GDP projection to rise 5.6% in 2026 as non-oil sectors continue to expand. Tourist, trade and financial services remain crucial growth motorists, supported by population growth and sustained domestic demand. Dubai's economy grew 4.4% in the first half of 2025, showing broad-based non-oil strength.

Oil production is expected to get once again in the second half of 2026, matching continuous financial investment in facilities, innovation 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 building diverse, resilient and internationally 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 entering 2026 with strong structures. Saudi non-oil activity is gaining speed, supported by robust need and rising financial investment, even as fiscal pressures increase.""The UAE continues to gain from strong domestic fundamentals, a sharp uplift in federal government spending and sustained diversity efforts.
Leading the 2026 Regional Economic Environment for LeadersWhat differentiates 2026 from preceding years is not merely the velocity of technological modification, though that acceleration is genuine, but rather an essential shift in how enterprises envisage their GCCs' purpose. The is anticipated to grow to four hundred thirteen billion dollars by 2040, however this growth masks a more extensive improvement.
Rather, they ask whether these centers drive innovation, own profit-and-loss duty, and contribute to competitive differentiation. In 2026, the most successful GCCs will act like internal startups, nimble, cross-functional, insight-driven, and deeply lined up with global business outcomes. This shift from execution to ownership represents maybe the single most significant 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 follows, consisting of the expansion and ongoing advancement of the Gulf's capital markets, and the area's growing function in global networks of capital and trade.
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