The Mastercard Economics Institute has released its 'Economic Outlook 2026', projecting a 3.6% year-on-year GDP growth for the Middle East and North Africa (MENA) region, surpassing the global average of 3.1%. This growth is expected to be uneven across the region, with Qatar leading at 4.9%, followed by Egypt at 4.4%. The UAE and Saudi Arabia are forecast to see GDP increases of 4.3% and 3.6%, respectively, with non-oil GDP in both countries anticipated to be close to 5%.
Investment in renewables, construction, and technology is a key growth driver, aligning with national visions such as Saudi Arabia's Vision 2030. These investments are set to support non-oil growth, economic diversification, and job creation. Whilst, oil-importing nations are focusing on attracting foreign direct investment, particularly in renewable energy sectors.
The report highlights the shift in trade towards emerging markets within the Eastern Europe, Middle East, and Africa (EEMEA) region, despite challenges from higher tariffs and geopolitical tensions. Digital transformation, especially through AI integration, is expected to boost productivity and growth, supported by strategies like the UAE National Strategy for Artificial Intelligence 2031.
Small and medium enterprises (SMEs) remain crucial to the region's economy, with digital tools enabling them to streamline operations and compete more effectively. In the UAE, SMEs account for over 37% of retail spending, with a growing share in e-commerce.
Khatija Haque, chief economist at Mastercard Economics Institute, noted, “Looking ahead to 2026, the economic forecast for the MENA region appears broadly favourable, driven in part by ongoing structural reforms.” However, risks such as geopolitical tensions and climate-related challenges could impact investment and economic activity.
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