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National AI strategies, sovereign cloud, smart-city platforms, digital government and fintech.
Market view
The Middle East region is investing at scale in national AI strategies, sovereign cloud, smart-city platforms, digital government and fintech, among other digital innovations. That ambition has made digital services central to national competitiveness, and it has equally raised the cost of disruption. National authorities and operators have been early to report AI-enabled attacks and are incorporating automation and AI in defence as well.
The most important development of 2026 is the convergence of physical and cyber risks. Reported drone strikes on cloud data centres in the UAE in 2026 caused regional outages that affected banking apps, payments platforms and consumer services. Cloud resilience is no longer only an architecture question. It is a geography, continuity and sovereignty question, and it is reshaping demand for multi-zone design, sovereign hosting options and dependency mapping. The market for managed detection, critical-infrastructure protection and localised capability is expanding accordingly, supported by national localisation and capacity development goals.
In the ITU’s Global Cybersecurity Index 2024, eight Arab States reached Tier 1, the “role-modelling” tier that only 46 countries worldwide achieved. Several Gulf states are among the highest scorers globally, reflecting strong national strategies, legal frameworks, incident response teams and public-private cooperation. However, skills and capacity gaps, as well as resilience against emerging threats remain a concern across a region facing heightened security risks.
Threat landscape
Since the regional conflict escalated in early 2026, cyber activity has followed the military situation. A number of cyber incidents have been reported, including DDoS attacks, ransomware and attacks targeting financial digital infrastructure. The UAE Cybersecurity Council reported attacks tripling following the escalation of the war. Financial services, aviation, energy, telecoms and government-linked entities are the highest-probability targets. Our analysis suggests rising ransomware activity against Gulf businesses and infrastructure and lower barriers to entry through AI.
Sector exposure: Financial services face DDoS attacks, phishing, AI-assisted intrusion and ransomware. Aviation faces DDoS attacks and targeted campaigns against airport and airline systems. Energy and utilities face ransomware and other industrial-control claims and espionage. Telecoms and cloud providers face DDoS attacks as well as physical disruption of data-centre infrastructure, while government entities face defacement, hack-and-leak and data exfiltration, among other threats. SMEs are equally being targeted through financially motivated attacks.
Attack claims named banks, telecom operators, airports and government ministries across the Gulf, mostly involving DDoS and defacement. Some bank outages were reported, with links to cyberattacks unconfirmed.
Reported drone strikes on two cloud data centres in the UAE caused outages across banks, payment platforms and consumer apps. Physical events can take down digital services, which makes multi-security design and tested failover board-level priority.
The UAE Cybersecurity Council disclosed neutralising AI-assisted campaigns against financial services in July and against aviation, energy and education on 10 August, with no service disruption. Coordinated national monitoring and early detection can work, and it sets a benchmark for sector-level collaboration.
The Everest ransomware group claimed to have stolen approximately 11.7 GB of data from Jordan Kuwait Bank, a 64-branch lender headquartered in Amman. The exfiltrated data included employee names, banking details, dates of birth and personal records, and the attackers threatened to publish it unless a ransom was paid. The incident demonstrates that financial institutions across the Levant are increasingly within scope for internationally active ransomware groups.
DragonForce ransomware targeted a prominent Riyadh construction and real estate company, exfiltrating over 6 TB of sensitive data. The company refused to pay the ransom, and the attackers published the data via a dedicated leak site. The incident marked the group’s first large-scale attack against a Saudi enterprise, signalling that international ransomware operators are expanding focus into the Gulf’s property and construction sector.
The Clop ransomware group claimed an attack against NAMA, Oman’s national electricity distribution holding company, threatening to publish sensitive data unless a ransom was paid. Energy utilities are high-value ransomware targets across the Gulf: a disruption to electricity distribution has immediate cascading effects on the economy, public services and national security.
Regulation
The region does not have a single regulatory regime, similar to the Europe region. Each jurisdiction in the Gulf sets its own rules. The direction of travel is, however, consistent: data protection is moving from adoption to active enforcement, and cybersecurity controls are becoming mandatory for critical sectors.
The practical implication is that compliance evidence must be produced quickly and, in some cases, to multiple regulatory actors. Therefore, records of processing, breach playbooks and transfer mechanisms need to be ready to share within days, not weeks.
Data protection enforcement
National data protection laws are now in the enforcement phase. Regulators are opening investigations quickly, issuing formal violation decisions and setting short response windows, sometimes only days. Many laws apply to foreign organisations that process residents’ data, and breach notification is mandatory within a stipulated timeframe.
Mandatory cybersecurity control frameworks
National cybersecurity authorities publish baselines and controls that apply to government and critical-sector operators, and increasingly to their suppliers and service providers.
Overlapping regimes
National rules sit alongside financial-centre and free-zone frameworks and sector regulators for banking, telecoms and capital markets. Organisations must comply with applicable rules.
Data residency and transfers
Restrictions on cross-border transfers and localisation expectations are shaping cloud and AI architectures in the region.
Emerging AI and digital-safety rules
Regulators are applying and incorporating data protection, consumer and child online safety principles to AI systems and digital platforms, rather than waiting for a single AI statute.
Looking ahead
Looking ahead. Cyber activity will continue to follow the regional security situation, with spikes expected around military and political events as previously recorded. Ransomware and other threats will continue to affect critical sectors. We expect more enforcement decisions by regulators, tighter response windows, expanding sector requirements and growing demand for geographically diverse cloud and physical-cyber business continuity planning around digital infrastructures.
How we help
We help Middle East clients build defences that reflect the real threat, not just the compliance checklist. Engagements typically begin with a threat-scenario workshop and an exposure review, then move to resilience design and assurance, supported by capacity development. We collaborate with our partners to deliver:
Speak to our Middle East team about a threat exposure and compliance review.
Intelligence-led assessments of exposure to state-aligned and ransomware activity, with sector-specific briefings.
Risk-based roadmaps that prioritise the controls for critical assets and systems.
Architecture reviews, segmentation and monitoring for energy, aviation, maritime and industrial/manufacturing environments.
AI inventories, risk classification and control design to support security-guided AI adoption.
National control frameworks, data protection and financial-centre compliance programmes built on one control set, with auditable records to support compliance.
Business continuity design, DDoS and ransomware resilience, executive crisis simulations and incident response retainers.
Red teaming, adversary emulation, and identity, cloud and endpoint security testing and management.
Board education and SOC maturity programmes that support national localisation goals, as well as risk awareness training
Cybersecurity ·
Source · World Economic Forum
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