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To reverse a years of deteriorating total element efficiency, local labour market policy is moving from basic job production to handling active workforce transitions. Federal governments and employers are scaling short, modular training programs and micro-credentials in data analytics and digital operations to equip workers for emerging roles. Workplace-based learning and apprenticeship-style pathways are ending up being more common as companies incorporate AI tools into day-to-day workflows.
With oil costs forecasted to average $55-60 per barrel in 2026, regional federal governments are heightening their focus on expenditure discipline and personal capital mobilisation. Fiscal policy is rotating towards the monetisation of state-owned properties in logistics, utilities, and desalination to redirect funds towards higher-impact financial investments. While borrowing via sukuk and sustainability-linked bonds is expected to increase to money strategic deficits, the focus stays on enhancing non-oil income structures.
PwC Middle East financial policy and technique partner Jing Teow said: "Having currently mobilised capital and policy at scale, GCC governments are now focused on delivery. In 2026, the concern is enhancing economic strength through more safe trade and investment relationships, efficient AI release, managed workforce shifts and disciplined financial policy in a more difficult 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, resilient domestic need and renewed investment momentum, according to the most recent ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is anticipated to exceed most worldwide areas peers next year, with regional GDP projection to grow by 4.4%. Throughout the GCC, non-energy activity is projected to broaden by 4.1% in 2026, driven by strong labour markets, enhancing credit conditions and rising investment in technology and AI-related infrastructure.
Oil revenues will be under pressure in the very first half of 2026, production is expected to rise once again in the 2nd half of 2026, supporting the region's medium-term outlook, it specified. Saudi Arabia will remain a major contributor to GCC momentum, with GDP forecast to grow 4.3% in 2026.
Development will be supported by commercial growth and policy reforms, including reduced foreign ownership rules that aim to promote additional investment. The fiscal deficit is projected to widen to 5.6% of GDP next year amid softer oil rates, while the recent five-year lease freeze in Riyadh aims to ease inflationary pressures, though it might constrain future real estate supply.
Strong domestic fundamentalsThe UAE is also placed for another strong year of efficiency, with GDP forecast to rise 5.6% in 2026 as non-oil sectors continue to broaden. Tourism, trade and monetary services stay crucial growth drivers, supported by population growth and continual domestic demand. Dubai's economy grew 4.4% in the very first half of 2025, reflecting broad-based non-oil strength.
Oil production is expected to select up once again in the second half of 2026, matching ongoing financial investment in facilities, innovation and worldwide trade partnerships. Hanadi Khalife, the Head of Middle East, ICAEW, said: "This quarter's outlook reinforces how far the GCC has can be found in building varied, durable and worldwide competitive economies.
Assessing the Possible of Saudi Arabia's Emerging Urban HubsScott Livermore, ICAEW Economic Advisor, and Chief Economic Expert and Managing Director, Oxford Economics Middle East, stated: "Saudi Arabia and the UAE are entering 2026 with strong foundations. Saudi non-oil activity is gaining rate, supported by robust need and rising investment, even as financial pressures increase.""The UAE continues to gain from solid domestic principles, a sharp uplift in government costs and continual diversity efforts.
Assessing the Possible of Saudi Arabia's Emerging Urban HubsWhat differentiates 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 anticipated to grow to 4 hundred thirteen billion dollars by 2040, but this development masks a more extensive transformation.
Instead, they ask whether these centers drive innovation, own profit-and-loss responsibility, and add to competitive differentiation. In 2026, the most successful GCCs will behave like internal startups, nimble, cross-functional, insight-driven, and deeply lined up with international organization results. This shift from execution to ownership represents possibly the single most significant strategic recalibration in the GCC model's evolution.
Today, we're convening more than 3000 conferences 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 combining investors, business, exchanges, and policymakers to discuss what is altering in the area, and what follows, including the growth and continuous development of the Gulf's capital markets, and the region's growing function in international networks of capital and trade.
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