For years, the global AI conversation has been framed as a race led by Silicon Valley, with the US and China setting the pace and everyone else trying to catch up. In the Middle East, however, that narrative is increasingly difficult to sustain.
Across the Gulf, particularly in the UAE and Saudi Arabia, artificial intelligence is no longer being treated as a technology of the future. It has become an economic strategy, a government priority and, increasingly, a consumer reality.
The UAE announced its national Artificial Intelligence Strategy in 2017, well before generative AI became mainstream, with the ambition of making the country a global leader in AI. Saudi Arabia followed with its National Strategy for Data and AI, approved in 2020, setting ambitions that include ranking among the world’s top 15 countries in AI and attracting about SAR75 billion ($20 billion) in data and AI investment.
AI moves into markets
That early commitment is now translating into measurable adoption.
The 2026 Stanford AI Index reports that 88% of surveyed organisations globally were using AI in 2025, while generative AI was being used in at least one business function by 70%. More strikingly for the Gulf, generative AI reached 53% population-level adoption globally within three years — faster than the personal computer or the internet — while the UAE reached an estimated 64%, one of the highest rates recorded.
Consumer behaviour tells a similar story. A 2025 global study by the University of Melbourne and KPMG found that 97% of respondents in the UAE used AI for work, study or personal purposes, while the corresponding figure for Saudi Arabia was 94%. In the UAE, 66% also said their organisation had a generative AI policy in place.
That matters enormously for marketers.
AI adoption among consumers changes the environment in which brands communicate. People are no longer simply searching Google, scrolling social feeds or visiting brand websites. Increasingly, they are asking AI systems to recommend products, compare options, summarise information and help make purchasing decisions.
For brands, therefore, the challenge is moving from using AI to understanding what AI changes about the customer journey.
The Middle East already offers examples of what that can look like. Luxury retailer Chalhoub Group, for instance, launched Layla AI with FACES as a generative AI-powered beauty coach, providing personalised recommendations across skincare, makeup, fragrance and haircare. The company says the technology has generated a 2.5-times higher conversion rate, alongside longer sessions and greater product exploration.
Jeremy Denisty, Director of Artificial Intelligence at Chalhoub Group, has described the company’s approach as a “human-in-the-loop” AI journey — one in which technology amplifies rather than replaces people. The group has also been training leaders to understand AI rather than simply fear it, embedding the technology into its wider Vision 2033 strategy.
This distinction may prove critical for the region’s advertising and marketing industry.
The temptation with generative AI is to equate adoption with producing more content, faster. But speed is becoming a commodity. The more important competitive advantage will be knowing what to automate, what to personalise and, crucially, what should remain human.
The global numbers underline the opportunity — and the gap that remains. Stanford found that 71% of organisations using AI in marketing and sales reported revenue gains in 2024, although most reported increases of less than 5%. Meanwhile, the World Economic Forum’s Future of Jobs Report 2025 found that 86% of employers globally expect AI and information-processing technologies to transform their businesses by 2030. Yet half of executives identified skills shortages as a major barrier to AI adoption.
The capability gap
That is where the Middle East’s AI story becomes more complicated.
The region has considerable advantages: strong government backing, capital, rapidly expanding digital infrastructure and relatively high consumer willingness to experiment with new technologies. Microsoft and Abu Dhabi-based G42, for example, announced a 200-megawatt expansion of UAE data-centre capacity, part of Microsoft’s broader planned investment of more than $15 billion in the UAE through 2029.
But infrastructure does not automatically create AI capability.
A 2025 academic analysis of AI governance across the six GCC states identified recurring challenges including talent shortages, data limitations and the difficulty of translating ethical principles into enforceable governance. Another study examining the GCC workforce warned of a potential two-track talent system: highly specialised AI researchers on one side and rapidly trained practitioners on the other.
Trust is another frontier.
KPMG’s UAE research found that while 68% of respondents believed current regulation was sufficient to make AI use safe — compared with 43% globally — 73% were cautious about online content because of the possibility of AI-generated material, while 36% were unsure whether they could distinguish AI-generated misinformation from authentic content. Matin Jouzdani, then Partner for Data, Analytics and AI at KPMG Lower Gulf, argued that rapid deployment must be accompanied by training, literacy and responsible AI governance.
For the region’s marketing ecosystem, this may be the defining challenge of the next phase.
The question is no longer whether agencies can generate an image with AI, produce a first draft of a campaign or automate a media workflow. Those capabilities are rapidly becoming standard. The real test is whether agencies and brands can combine AI’s scale with something algorithms cannot easily manufacture: cultural intelligence, local insight, creativity and trust.
The Gulf has already demonstrated that it can move quickly when technology becomes a national priority. The next test is whether its marketing and creative industries can move just as quickly — not by following the AI race, but by defining what leadership looks like.
The Middle East may therefore be asking the wrong question when it asks whether it is ready for AI.
In some respects, it is already ahead.
The more consequential question is what the region will do with that head start
