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The sector likewise faced broader macro headwinds, consisting of a more mindful policy background in China and worldwide risk-off sentiment driven by geopolitical stress and greater energy rates. Thematic ETFs Struggled for the a lot of part, especially those connected to carbon and high-growth technology, as evaluation pressures and global rate characteristics weighed on performance.
Circulations in Q1 2026 were modest and extremely focused, reflecting selective allowance rather than broad market involvement. In spite of weak efficiency, ETFs taped $27.1 million in net inflows, with only a small number of products attracting brand-new capital.
Trading activity remained steady, 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 taken location in the secondary market, enabling financiers to change positions without considerable main developments or redemptions. While current geopolitical events have led to more financial pressure on GCC countries, the area remains durable and well capitalized to deal with the situation.
In January, Boreas launched its S&P Global Luxury UCITS ETF, including a specific niche thematic exposure focused on worldwide high-end and consumer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 revealed some progress associating with ETFs in the GCC. We expect more worldwide and thematic ETFs to list in the GCC throughout 2026. While the dispute has impacted belief and costs throughout the quarter, it has driven more volume and interest in local possessions.
In spite of ongoing geopolitical tensions and security threats across the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to show resilience, preserving favorable development momentum in the last few years. While conflicts in the broader region and international financial unpredictability remain a structural restriction, GCC countries have so far limited their effect on domestic financial efficiency through strong fiscal positions, policy continuity, and continual financial investment.
The World Bank, on the other hand, projects 3.2 percent development in 2025, speeding up to 4.5 percent in 2026. The IMF likewise sees momentum improving, with GCC output growth projected to rise from 1.7 percent in 2024 to 3.3 percent usually in 2025, reflecting a shift toward more positive total conditions.
The IMF's World Economic Outlook (October 2025) projects worldwide growth reducing to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC growth would place the area materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a relatively high-growth pocketprovided that local risk conditions stay included and reform momentum holds.
Data from the GCC Statistical Center reveal that non-oil sectors already represent more than 73 percent of total GDP, a share that has continued to rise as governments broaden investment in services, facilities, and technology. According to Oxford Economics, non-energy activity throughout the GCC is projected to grow by around 4.1 percent in 2026, supported by strong labor markets, enhancing credit conditions, and rising investment in innovation and AI-related infrastructure.
Public-sector investment and reform stay central to sustaining this trend. Policy steps focused on attracting foreign direct investment, easing foreign ownership rules, broadening capital markets, and supporting private-sector participation continue to underpin non-oil expansion and minimize the area's direct exposure to oil cost volatility. While hydrocarbons no longer dominate the development outlook, oil earnings are anticipated to play a helpful role 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 Sees momentum improving, with GCC output growth projected to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more positive general conditions.
The IMF's World Economic Outlook (October 2025) jobs international development reducing to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC expansion would put the area materially ahead of the world average and a little above (or broadly in line with) the emerging-market aggregate, strengthening the GCC's status as a reasonably high-growth pocketprovided that regional danger conditions stay included and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors already represent more than 73 percent of overall GDP, a share that has actually continued to increase as federal governments expand financial investment in services, infrastructure, 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, enhancing credit conditions, and increasing investment in technology and AI-related infrastructure.
How to Enhance Middle East Business StrategyPublic-sector financial investment and reform stay central to sustaining this pattern. Policy measures targeted at attracting foreign direct financial investment, relieving foreign ownership guidelines, broadening capital markets, and supporting private-sector involvement 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 expected to play a helpful role in 2026.
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