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To reverse a years of weakening total element productivity, regional labour market policy is moving from simple task development to managing active labor force transitions. Governments and companies are scaling short, modular training programmes and micro-credentials in data analytics and digital operations to gear up employees for emerging roles. Workplace-based knowing and apprenticeship-style pathways are becoming more common as companies incorporate AI tools into everyday workflows.
With oil prices forecasted to typical $55-60 per barrel in 2026, regional governments are magnifying their focus on expenditure discipline and private capital mobilisation. Fiscal policy is pivoting towards the monetisation of state-owned possessions in logistics, utilities, and desalination to reroute funds towards higher-impact investments. While borrowing via sukuk and sustainability-linked bonds is expected to increase to money tactical deficits, the focus stays on enhancing non-oil revenue frameworks.
PwC Middle East economic policy and strategy partner Jing Teow said: "Having currently mobilised capital and policy at scale, GCC governments are now focused on delivery. In 2026, the top priority is enhancing economic resilience through more safe and secure trade and investment relationships, effective AI implementation, managed 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 expansion in 2026, supported by strong private-sector performance, durable domestic need and restored investment momentum, according to the current 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%. Across 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 facilities.
Oil profits will be under pressure in the first half of 2026, production is expected to increase once again in the 2nd half of 2026, supporting the region's medium-term outlook, it mentioned. Saudi Arabia will stay a major contributor to GCC momentum, with GDP forecast to grow 4.3% in 2026.
Development will be supported by industrial expansion and policy reforms, including eased foreign ownership guidelines that intend to stimulate additional investment. The fiscal deficit is forecasted to broaden to 5.6% of GDP next year amid softer oil rates, while the recent five-year lease freeze in Riyadh intends to reduce 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 increase 5.6% in 2026 as non-oil sectors continue to expand. Tourist, trade and financial services remain essential growth drivers, supported by population growth and sustained 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 get again in the second half of 2026, matching continuous investment in facilities, innovation and worldwide trade partnerships. Hanadi Khalife, the Head of Middle East, ICAEW, stated: "This quarter's outlook strengthens how far the GCC has been available in structure diverse, durable and internationally competitive economies.
What Every Financier Needs To Learn about Qatar's Legal ShiftScott Livermore, ICAEW Economic Advisor, and Chief Economic Expert and Managing Director, Oxford Economics Middle East, said: "Saudi Arabia and the UAE are entering 2026 with strong foundations. Saudi non-oil activity is getting rate, 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 continual diversity efforts.
Why Efficiency Is the Key Focus for UAE SkillWhat identifies 2026 from preceding years is not just the acceleration of technological change, though that velocity is real, but rather an essential shift in how enterprises envisage their GCCs' purpose. The is anticipated to grow to 4 hundred thirteen billion dollars by 2040, but this growth masks a more profound change.
Rather, they ask whether these centers drive innovation, own profit-and-loss responsibility, and add to competitive distinction. In 2026, the most effective GCCs will act like internal startups, agile, cross-functional, insight-driven, and deeply aligned with global company outcomes. This shift from execution to ownership represents perhaps the single most considerable tactical recalibration in the GCC design's development.
This week, we're convening more than 3000 conferences in between investors and 119 Gulf-listed business with a combined value of $2.4 trillion at the HSBC GCC Exchanges Conference 2026, in London. We're bringing together financiers, companies, exchanges, and policymakers to discuss what is altering in the region, and what comes next, including the growth 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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