As the Middle East moves into 2026, technology investment across the region is clearly shifting beyond artificial intelligence. Governments are now prioritising sovereign technologies such as biotechnology, quantum computing, nuclear energy, sovereign data infrastructure and zero trust cybersecurity. These areas are closely tied to national industrial strategies, security planning and long term economic diversification, changing how foreign companies approach the market.
For global businesses, the rules of engagement are evolving fast. Success is no longer driven by short term market entry but by “localization”, regulatory understanding and long term partnerships with state backed entities. These trends are shaping a new business environment where local presence and alignment with national priorities have become essential for growth.
Biotechnology and life sciences are moving from research to large scale commercial deployment. The Middle East biotechnology sector is rapidly becoming a multi billion dollar industry, supported by healthcare needs and climate goals. The UAE and Saudi Arabia are leading this expansion, while Bahrain continues to invest in testing and development capacity. By 2027, the genomics market across the Middle East and Africa is projected to reach US$1.2 billion, with Saudi Arabia and the UAE expected to capture around 60% of the opportunity. At the same time, biofuel production is scaling as governments align investments with 2030 and 2050 climate targets, supported by capital from sovereign investors such as Mubadala and Saudi Aramco.
Quantum computing is also gaining momentum through early industrial pilots. Saudi Aramco has partnered with Pasqal to launch the Kingdom’s first quantum computer for energy focused applications, while the UAE Technology Innovation Institute is working with Quantinuum on quantum algorithms for logistics and materials research. Alongside this, geopatriation is accelerating as countries localise data, cloud infrastructure and hardware. In semiconductors, Abu Dhabi based Mastiska has raised US$10 million in seed funding to build domestic chip design capacity, while sovereign satellite programmes are strengthening regional control over critical technologies.
Energy security is another major focus area. By 2035, nuclear capacity in the Middle East is expected to triple, with small modular reactors emerging as a flexible solution to power data centres and industrial growth. At the same time, cyber risks are rising, with data breaches above US$100000 affecting 15% of organisations. This is driving a regional shift toward zero trust cybersecurity to protect both IT systems and critical infrastructure. Together, these trends signal that in 2026, foreign firms must embed themselves into local ecosystems to succeed.
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