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The sector likewise dealt with broader macro headwinds, consisting of a more mindful policy background in China and international risk-off sentiment driven by geopolitical tensions and higher energy rates. Thematic ETFs likewise had a hard time for the many part, especially those linked to carbon and high-growth technology, as evaluation pressures and global rate characteristics weighed on performance.
The petrochemical ETF significantly surpassed. Flows in Q1 2026 were modest and highly concentrated, showing selective allocation instead of broad market participation. Regardless of weak efficiency, ETFs tape-recorded $27.1 million in net inflows, with only a small number of products attracting new capital. This indicates that investors were targeting specific exposures, while lowering or rotating out of others.
Trading activity stayed stable, with typical 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. The majority of activity appears to have occurred in the secondary market, enabling financiers to change positions without considerable primary creations or redemptions. While current geopolitical occasions have led to more monetary pressure on GCC countries, the area remains resistant and well capitalized to deal with the circumstance.
In January, Boreas released its S&P Global Luxury UCITS ETF, adding a niche thematic exposure focused on worldwide luxury and customer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 revealed some progress connecting to ETFs in the GCC. We anticipate more worldwide and thematic ETFs to list in the GCC throughout 2026. While the conflict has impacted belief and rates throughout the quarter, it has actually driven more volume and interest in local assets.
Despite continuous geopolitical stress and security dangers across the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to demonstrate resilience, preserving positive development momentum in the last few years. While conflicts in the larger area and worldwide economic uncertainty stay a structural restraint, GCC countries have so far restricted their impact on domestic economic efficiency through strong financial positions, policy continuity, and continual investment.
The World Bank, on the other hand, jobs 3.2 percent growth in 2025, accelerating to 4.5 percent in 2026. The IMF Sees momentum improving, with GCC output growth forecasted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more positive overall conditions.
Key Steps for Industrial Excellence in DubaiThe IMF's World Economic Outlook (October 2025) projects international growth reducing to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and developing economies simply above 4 percent. On that comparison, a 4.44.5 percent GCC growth would put the region materially ahead of the world average and a little above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a fairly high-growth pocketprovided that regional risk conditions remain included and reform momentum holds.
Information from the GCC Statistical Center reveal that non-oil sectors currently represent more than 73 percent of total GDP, a share that has actually continued to increase as governments broaden financial investment in services, facilities, and technology. According to Oxford Economics, non-energy activity throughout the GCC is forecasted to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and increasing investment in technology and AI-related facilities.
Public-sector financial investment and reform remain central to sustaining this pattern. Policy measures focused on attracting foreign direct financial investment, alleviating foreign ownership guidelines, expanding capital markets, and supporting private-sector participation continue to underpin non-oil growth and minimize the region's direct exposure to oil rate volatility. While hydrocarbons no longer dominate the development outlook, oil profits are anticipated to play a helpful function in 2026.
The World Bank, on the other hand, projects 3.2 percent growth in 2025, accelerating to 4.5 percent in 2026. The IMF similarly sees momentum improving, with GCC output development projected to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift toward more positive overall conditions.
The IMF's World Economic Outlook (October 2025) tasks global development reducing to 3.1 percent in 2026, with advanced economies around 1.5 percent and emerging market and developing economies simply above 4 percent. On that contrast, a 4.44.5 percent GCC growth would position the region materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, enhancing the GCC's status as a reasonably high-growth pocketprovided that regional risk conditions stay consisted of and reform momentum holds.

Data from the GCC Statistical Center reveal that non-oil sectors currently account for more than 73 percent of overall GDP, a share that has continued to rise as federal governments broaden financial investment in services, facilities, and innovation. According to Oxford Economics, non-energy activity across the GCC is projected to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and increasing investment in innovation and AI-related facilities.
Essential Middle East Market Research Insights in 2026Public-sector financial investment and reform remain central to sustaining this trend. Policy procedures intended at drawing in foreign direct investment, reducing foreign ownership guidelines, broadening capital markets, and supporting private-sector participation continue to underpin non-oil expansion and minimize the area's direct exposure to oil rate volatility. While hydrocarbons no longer dominate the development outlook, oil incomes are expected to play a helpful role in 2026.
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