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Middle East capital and policy moves are setting the tone for markets and businesses today. Sovereign wealth funds across the region are leading a record $15 trillion global investment pool, doubling down on technology and AI as Gulf players dominate global dealmaking. In Saudi Arabia, higher input costs are back in focus after Aramco raised diesel prices by 8%, prompting listed cement and industrial firms to flag rising production expenses. Meanwhile in the UAE, authorities have begun enforcing strict Emiratisation penalties, with companies facing fines of AED108,000 for every unfilled national role, underscoring the government’s push to reshape the private-sector workforce.

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Markets

Middle East Sovereign Wealth Funds Lead $15 Trillion Global Push Into Tech And AI

What’s it About?

Middle East sovereign wealth funds tightened their grip on global capital markets in 2025, as state-owned investors worldwide grew assets under management to a record $15 trillion, according to a new report by Global SWF. Gulf funds led a $66 billion global push into artificial intelligence and digitalization, with Abu Dhabi’s Mubadala Investment Co. investing $12.9 billion, followed by the Kuwait Investment Authority at $6 billion and the Qatar Investment Authority at $4 billion. Overall, the region’s seven major sovereign wealth funds accounted for 43% of all capital deployed by state-owned investors globally, investing a historic high of $126 billion.

Why it Matters?

The scale and direction of Middle East sovereign investments underline the region’s growing influence over the future of global technology and capital flows. Saudi Arabia’s Public Investment Fund (PIF) emerged as the single largest dealmaker of 2025, committing $36.2 billion, largely driven by its participation in the acquisition of Electronic Arts Inc. Excluding that deal, Mubadala was the most active sovereign wealth fund globally, deploying a record $32.7 billion across 40 transactions. These moves came amid strong market returns across fixed income, equities, real estate and infrastructure, further boosting the financial firepower of sovereign investors.

What’s Next?

Globally, state-owned investors are expected to remain active as capital continues to concentrate in major markets, particularly the US, which attracted $131.8 billion in sovereign investment in 2025, up sharply from $68.9 billion a year earlier. The US also leads in total assets under management at $13.2 trillion, followed by China with $8.2 trillion and the UAE at $2.9 trillion. At the same time, sovereign investment into China fell to $4.3 billion from $10.3 billion in 2024, signaling a possible reallocation of capital—one that Middle East funds appear well-positioned to capitalize on as they deepen bets on technology, AI and global growth assets.

Saudi Aramco Raises Diesel Prices By 8% As Industrial Costs Climb

What’s it About?

Saudi Aramco raised diesel prices by 8% from January 1, taking the price to SAR1.79 per litre from SAR1.66 in 2025. Cement producers and other Saudi-listed companies said the increase has lifted manufacturing and operating costs.

Why it Matters?

Several cement firms, including Riyadh Cement, Qassim Cement and Arabian Cement, reported production cost increases of 6% to 11%. The hike adds pressure on energy-intensive industries already facing a 15% value-added tax on diesel prices.

What’s Next?

The increase aligns with Saudi Arabia’s Vision 2030 fuel displacement programme, which aims to replace liquid fuels with gas and renewables. Riyadh targets displacing over one million barrels of oil per day by 2030 while cutting carbon emissions.

UAE Imposes AED108,000 Fine Per Unfilled Emiratisation Role In Private Sector

What’s it About?

The UAE has begun enforcing penalties on private-sector companies that failed to meet Emiratisation targets for 2025. Firms are being charged Dh108,000 for each Emirati national not hired, following a December 31 compliance deadline set by authorities.

Why it Matters?

The move reinforces Emiratisation as a core national priority, increasing pressure on companies with 50 or more employees to raise Emirati representation in skilled roles by 2%. Smaller firms in targeted sectors are also affected, widening the policy’s reach.

What’s Next?

Enforcement will continue through financial and regulatory measures. Companies with 20 to 49 employees in selected sectors must hire at least one Emirati and retain nationals employed before January 1, 2025, or face further penalties.

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👨‍💻From Smashi Business’ Desk

• PIF’s $45B SoftBank Bet Aimed at AI Exposure Despite Underwhelming Returns.

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🔍In other news…

• Saudi PIF-backed HUMAIN receives first shipment of latest NVIDIA AI chips

• Perfumes drive Dubai Duty Free sales higher in 2025

• UAE issues laws to strengthen capital markets regulation

• New UAE law lets minors manage assets from age 15 with court approval

• Fintech dominance of Middle East VC funds likely to persist

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