Deloitte: 65% of Middle East Firms to Boost AI Investment

Ummulkiram Pardawala -
  • New State of AI in the Middle East report by Deloitte and MBZUAI highlights the opportunities of AI for organizations in the region
  • UAE leads in adopting IT, digital, and operations-focused AI
  • Most organizations report being in the early stages or proof-of-concept phase of AI adoption, with leading use cases including content generation and summarization
  • One in every three organizations in the Middle East are dedicating more than 60% of their AI budgets to GenAI, compared to data showing that 72% of global organizations are spending less than 40%
  • Almost 70% of organizations plan to increase headcount for AI roles, emphasizing a need for talent growth including upskilling existing staff and attracting AI graduates
  • Organizations see AI’s primary benefits as increased productivity (91%) and efficiency but struggle to measure ROI effectively
  • Data security (65%), regulation compliance (67%) and the talent gap (44%) are among the top concerns for AI implementation
  • Some 34% of respondents faced a significant hurdle selecting the right technologies to develop and deploy AI tools
  • The main reasons for AI model selection are support/access to expertise, accuracy and speed

A new report by Deloitte, the leading global professional services firm, in collaboration with Mohamed bin Zayed University of Artificial Intelligence (MBZUAI), reveals the immense opportunities presented by artificial intelligence (AI) in the Middle East. The 2025 State of AI in the Middle East Report also shines a spotlight on the challenges organizations face when investing in AI technology and ensuring they fully understand and utilize its potential.

The Perfect Storm: A perspective on unlocking AI’s value in Middle East draws on insights from more than 150 business and technology leaders across the United Arab Emirates (UAE), the Kingdom of Saudi Arabia (KSA), and Qatar, supplemented by interviews with key industry figures. It explores the dynamics of AI adoption while identifying the challenges that hinder progress and the strategies organizations are using to manage risks and maximize value.

While organizations across the Middle East are rapidly increasing AI investments, many lack the foundational elements needed to realize its full value. The latest research shows more than 80% of organizations feel pressured to adopt AI, yet almost half say they lack the talent and technology capabilities for successful scaling. Despite these challenges, 69% of organizations plan to increase investment in AI technologies in the coming year, according to the report.

Mutasem Dajani, Deloitte Middle East CEO, said,

The GCC region is making substantial investments in AI, driven by strong government commitments. With increasing funding for AI infrastructure and a growing emphasis on developing local talent, the region is positioning itself as a global leader in AI innovation. This transformation is accelerating the shift toward knowledge-based economies, compelling organizations to fundamentally rethink their operations.

Respondents in the survey claimed high levels of preparedness for technology infrastructure (71%), talent (68%) and strategy (69%). Risk and governance were slightly lower in terms of feeling highly or very highly prepared (63%). However, when considering only Generative AI (GenAI), global leaders felt much less prepared to address risk and governance, with 41% of leaders reporting they were only slightly or not at all prepared.

Professor Sami Haddadin, MBZUAI’s vice president for research, said:

This research highlights an increased focus on developing local AI specialists and practitioners who understand the potential of AI and how to execute implementation, while addressing concerns such as privacy and ethics. The report reveals a critical disconnect – a strong appetite among Middle Eastern organizations to deploy AI outpacing their readiness in terms of talent, strategic planning, and infrastructure.
As the world’s first university dedicated to artificial intelligence, MBZUAI is proud to be playing a pivotal role in addressing this major hurdle. We've made great strides in the last year through programs such as the MBZUAI Executive Program (MEP), the Master in Applied AI, and tailored workshops, we are empowering leaders and organizations to navigate the nuanced dynamics of AI adoption including managing risks and maximizing value. Implementing AI solutions requires talent, and growing the AI supply ecosystem is critical. This includes upskilling current professionals, preparing our current students, and fostering constructive and deeper research collaborations across key sectors and impactful areas such as energy and sustainability.

In terms of the perceived key benefits of GenAI, 91% of respondents expect increased productivity to be the most transformational benefit. The report found that one in three organizations in the Middle East are spending more than 60% of their AI budget on GenAI, compared to data showing that 72% of global organizations are spending less than 40%. However, not all organizations view AI in a positive light, with 41% seeing AI as a significant threat to their current operating model.

A significant hurdle faced by organizations developing and deploying AI tools is selecting the right technologies, as highlighted by 34% of respondents. Given the complexity of the available AI solutions, it can be difficult for business leaders to know which applications align best with organizational objectives, while another major challenge – difficulty identifying use cases – is closely linked, as organizations grapple with how GenAI can benefit their business.

There is a myriad of ways AI can supercharge efficiency and productivity, while also paving the way for entirely new products, citizen services, and business models,

Yousef Barkawie, AI & Data leader at Deloitte Middle East, said.

It’s vital that organizations take an analytical approach and develop clear strategies to assess demand, supply, and enablement of AI to ensure the technology can scale effectively, solve challenges, and generate a solid return on investment.  We see the need for elevating boardroom decision-making skills and frameworks to cope with this disruption,

he added.

News Source: Mohamed bin Zayed University of Artificial Intelligence (MBZUAI)