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To reverse a decade of deteriorating overall element productivity, local labour market policy is shifting from simple job production to managing active workforce transitions. Governments and companies 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 pathways are ending up being more typical as firms incorporate AI tools into everyday workflows.
With oil rates forecasted to typical $55-60 per barrel in 2026, regional federal governments are intensifying their concentrate on expenditure discipline and private capital mobilisation. Fiscal policy is rotating toward the monetisation of state-owned possessions in logistics, utilities, and desalination to reroute funds toward higher-impact financial investments. While loaning by means of sukuk and sustainability-linked bonds is expected to increase to money strategic deficits, the focus stays on strengthening non-oil earnings frameworks.
PwC Middle East economic policy and method partner Jing Teow said: "Having currently mobilised capital and policy at scale, GCC federal governments are now focused on shipment. In 2026, the priority is reinforcing economic durability through more protected trade and investment relationships, effective AI deployment, handled labor force shifts and disciplined financial policy in a more challenging and fragmented international environment.".
Saudi Arabia and UAE are poised to lead the Gulf region's economic growth in 2026, supported by strong private-sector performance, durable domestic need and renewed financial investment momentum, according to the latest ICAEW Economic Insight Q4 2025 report, produced by Oxford Economics. The GCC is expected to surpass most worldwide areas peers next year, with local GDP projection to grow by 4.4%. Across the GCC, non-energy activity is projected to expand by 4.1% in 2026, driven by strong labour markets, enhancing credit conditions and rising financial investment in technology and AI-related infrastructure.
Oil revenues will be under pressure in the first half of 2026, production is anticipated to increase once again in the 2nd half of 2026, supporting the area'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.
Growth will be supported by industrial growth and policy reforms, including reduced foreign ownership guidelines that aim to stimulate additional financial investment. The financial deficit is forecasted to widen to 5.6% of GDP next year in the middle of softer oil costs, while the recent five-year lease freeze in Riyadh aims to alleviate inflationary pressures, though it might constrain future real estate supply.
Strong domestic fundamentalsThe UAE is likewise positioned for another strong year of performance, with GDP projection to increase 5.6% in 2026 as non-oil sectors continue to expand. Tourist, trade and monetary services stay crucial development motorists, supported by population growth and continual domestic need. Dubai's economy grew 4.4% in the first half of 2025, showing broad-based non-oil strength.
Oil production is expected to get again in the second half of 2026, complementing continuous financial investment in infrastructure, innovation and global trade partnerships. Hanadi Khalife, the Head of Middle East, ICAEW, stated: "This quarter's outlook enhances how far the GCC has come in structure diverse, resilient and internationally competitive economies.
Scott Livermore, ICAEW Economic Advisor, and Chief Economic Expert and Managing Director, Oxford Economics Middle East, said: "Saudi Arabia and the UAE are getting in 2026 with strong structures. Saudi non-oil activity is acquiring rate, supported by robust need and increasing financial investment, even as fiscal pressures increase.""The UAE continues to gain from strong domestic fundamentals, a sharp uplift in federal government costs and continual diversification efforts.
What identifies 2026 from preceding years is not simply the velocity of technological change, though that acceleration is real, however rather an essential shift in how business envisage their GCCs' function. The is expected to grow to 4 hundred thirteen billion dollars by 2040, but this growth masks a more extensive improvement.
Rather, they ask whether these centers drive innovation, own profit-and-loss duty, and contribute to competitive distinction. In 2026, the most successful GCCs will behave like internal start-ups, nimble, cross-functional, insight-driven, and deeply aligned with global organization outcomes. This shift from execution to ownership represents perhaps the single most significant tactical recalibration in the GCC model's advancement.
This week, we're assembling more than 3000 conferences between financiers and 119 Gulf-listed companies with a combined value of $2.4 trillion at the HSBC GCC Exchanges Conference 2026, in London. We're bringing together investors, business, exchanges, and policymakers to discuss what is altering in the area, 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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