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To reverse a years of damaging total factor performance, local labour market policy is moving from easy job creation to managing active labor force transitions. Federal governments and employers are scaling short, modular training programs and micro-credentials in information analytics and digital operations to equip employees for emerging functions. Workplace-based knowing and apprenticeship-style paths are becoming more common as firms incorporate AI tools into everyday workflows.
With oil costs forecasted to average $55-60 per barrel in 2026, regional governments are heightening their focus on expenditure discipline and personal capital mobilisation. Financial policy is pivoting towards the monetisation of state-owned properties in logistics, utilities, and desalination to redirect funds towards higher-impact investments. While borrowing through sukuk and sustainability-linked bonds is anticipated to increase to money tactical deficits, the focus remains on reinforcing non-oil revenue structures.
PwC Middle East financial policy and method partner Jing Teow stated: "Having already mobilised capital and policy at scale, GCC governments are now concentrated on shipment. In 2026, the top priority is enhancing economic resilience through more secure trade and investment relationships, efficient AI deployment, managed labor force 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 performance, resistant domestic need and restored financial investment momentum, according to the current ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is anticipated to surpass most global regions peers next year, with regional 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 financial investment in innovation and AI-related facilities.
Oil incomes will be under pressure in the first half of 2026, production is anticipated to rise again in the 2nd half of 2026, supporting the area's medium-term outlook, it specified. Saudi Arabia will stay a major factor to GCC momentum, with GDP projection to grow 4.3% in 2026.
Development will be supported by commercial expansion and policy reforms, consisting of alleviated foreign ownership guidelines that intend to promote additional investment. The fiscal deficit is projected to expand to 5.6% of GDP next year amidst softer oil prices, while the current five-year lease freeze in Riyadh aims to alleviate inflationary pressures, though it might constrain future housing supply.
Strong domestic fundamentalsThe UAE is also placed for another strong year of efficiency, with GDP projection to rise 5.6% in 2026 as non-oil sectors continue to broaden. Tourist, trade and financial services stay essential development drivers, supported by population growth 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 again in the 2nd half of 2026, complementing continuous financial investment in infrastructure, technology and international trade partnerships. Hanadi Khalife, the Head of Middle East, ICAEW, stated: "This quarter's outlook strengthens how far the GCC has come in building diverse, resistant and globally competitive economies.
Redefining Staff Member Benefits for a New UAE AgeScott Livermore, ICAEW Economic Advisor, and Chief Economic Expert and Handling Director, Oxford Economics Middle East, stated: "Saudi Arabia and the UAE are going into 2026 with strong foundations. Saudi non-oil activity is acquiring speed, supported by robust demand and rising investment, even as financial pressures increase.""The UAE continues to gain from solid domestic basics, a sharp uplift in government costs and sustained diversification efforts.
What distinguishes 2026 from preceding years is not simply the velocity of technological modification, though that velocity is real, however rather a basic shift in how business envisage their GCCs' function. The is expected to grow to four 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 add to competitive differentiation. In 2026, the most successful GCCs will behave like internal start-ups, nimble, cross-functional, insight-driven, and deeply lined up with worldwide company outcomes. This shift from execution to ownership represents possibly the single most significant strategic recalibration in the GCC model's evolution.
Today, we're assembling more than 3000 meetings between financiers and 119 Gulf-listed business with a combined value of $2.4 trillion at the HSBC GCC Exchanges Conference 2026, in London. We're combining financiers, business, exchanges, and policymakers to discuss what is altering in the region, and what follows, including the expansion and ongoing development of the Gulf's capital markets, and the region's growing role in international networks of capital and trade.
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