Middle Eastern businesses are significantly increasing their AI investments, with 91% of organizations anticipating a productivity boost, according to a new report by Deloitte in collaboration with Mohamed bin Zayed University of Artificial Intelligence (MBZUAI).
The 2025 State of AI in the Middle East Report highlights the challenges companies face in adopting AI while ensuring they maximize its value. Based on insights from over 150 business and technology leaders across the UAE, Saudi Arabia, and Qatar, the report underscores a widening gap between AI ambition and readiness.
Despite strong government backing and growing AI infrastructure, over 80% of businesses feel pressured to integrate AI, yet nearly half acknowledge gaps in talent and technology necessary for large-scale implementation. Still, 69% plan to increase AI investments in the coming year.
Mutasem Dajani, CEO of Deloitte Middle East, emphasized the region’s commitment to AI-driven transformation, stating:
“The GCC’s substantial AI investments and focus on local talent development are positioning the region as a global leader in AI innovation. This shift is accelerating the transition toward knowledge-based economies, requiring organizations to rethink their operations.”
While survey respondents reported high preparedness levels for AI infrastructure (71%), talent (68%), and strategy (69%), risk and governance preparedness lagged at 63%. Concerns about Generative AI (GenAI) governance were even more pronounced, with 41% of leaders admitting they were unprepared to manage risks.
Professor Sami Haddadin, MBZUAI’s Vice President for Research, pointed to the urgent need for AI expertise, saying:
“There is a strong demand for AI adoption, but many organizations are not yet equipped in terms of talent, strategy, and infrastructure. MBZUAI is committed to closing this gap through specialized programs that prepare leaders to navigate AI risks and maximize its potential.”
The report also reveals a growing financial commitment to AI. One in three Middle Eastern companies allocate over 60% of their AI budgets to GenAI—compared to just 28% of global businesses. However, 41% of organizations still see AI as a direct threat to their operating models.
Selecting the right AI tools remains a major obstacle, with 34% of businesses struggling to identify the best-fit technologies. Additionally, many face difficulties pinpointing effective AI use cases.
Yousef Barkawie, AI and Data Leader at Deloitte Middle East, stressed the importance of a structured approach to AI adoption:
“AI offers vast potential to enhance efficiency, create new services, and drive innovation. Organizations must adopt clear strategies for AI demand, supply, and scalability to ensure a strong return on investment. Elevating decision-making at the board level will be crucial in navigating this technological shift.”
As AI reshapes industries across the region, businesses must bridge the gap between ambition and execution to fully harness its transformative power.
