How outsourcing to the gulf region can benefit European and North American companies
The IT outsourcing world is growing fast and is expected to generate an impressive
$591.24 billion
in revenue by 2025. Most of the industry's revenue came from the Americas. Europe, the Middle East, and Africa are close behind as big players in this booming market.
While India and Eastern Europe still lead the pack in outsourcing with their solid setup and skilled workers, the Gulf is becoming a tech powerhouse. More and more European and North American IT firms are looking to this region.
The Gulf Region as an Emerging Tech Hub
Countries in the Gulf Cooperation Council, particularly the UAE, Saudi Arabia, Qatar, and Bahrain, are rapidly accelerating their technological advancement initiatives.
Governments in the region are putting big money into wide-ranging digital overhaul programs in both public and private areas. These key efforts aim to build up local innovation skills, create appealing settings for global tech firms, and set up lasting digital systems that can hold their own on the world stage.
Main Benefits of Outsourcing to the Gulf for European and North American Companies
Outsourcing IT operations to the Gulf region influences companies looking to improve their performance. This region reduces expenses through lower overhead and offers access to skilled tech professionals. Because of this, businesses can increase their productivity and edge out competitors.
Cost Efficiency
The Gulf region may not offer the lowest labor costs compared to India or the Philippines, but it delivers competitively high-quality services.
Many Gulf nations give tax exemptions, lower business taxes, and set up free zones where businesses can work without paying VAT or income tax. Businesses that outsource to the Gulf can cut down on spending for buildings, staff training, and hiring.
Skilled Workforce
The Gulf region boasts a large and diverse talent pool with expertise in software development, AI, and more. Many professionals in the area have international certifications and experience working with Western companies.
Time Zone Benefit
One of the biggest advantages of outsourcing to the Gulf is that it sits on the clock.
Overlapping business hours with countries like the U.K., Germany, and France makes it easier to manage outsourced teams without delays. Companies can have live meetings, and reviews, and get updates from Gulf-based teams during their normal work hours.
Business-Friendly Environment
The Gulf region stands out as a prime outsourcing spot for European and North American firms due to its political stability, business-friendly policies, and solid legal systems.
Advanced Digital Infrastructure
The Gulf region boasts good digital infrastructure, providing fast internet, cutting-edge data centers, and reliable cloud computing options—essential for companies to outsource IT services.
Big tech firms like Microsoft, AWS, and Google Cloud operate data centers in the Gulf, offering secure and effective cloud solutions.
Saudi Arabia
and the UAE have put tough cybersecurity rules in place that line up with worldwide standards.
'Ideally, IT processes are running unnoticed in the background of your business because everything functions flawlessly and supports your work routine, not complicates it. As your IT outsourcing partner, we will strive for the ideal.'
Andy Lipnitski -
IT Director at ScienceSoft
Challenges of Gulf Outsourcing and How to Overcome Them
Cultural and Business Differences
The Gulf region has a business culture all its own shaped by local customs, religious beliefs, and top-down company structures. Some nations operate from Sunday to Thursday, which might lead to scheduling challenges for firms in Europe and North America.
Solutions:
Train your teams to understand the Gulf's cultural norms and business etiquette.
Set up structured communication channels to cut down on misunderstandings.
Legal and CompliancenConsiderations
Each Gulf country has its own rules for how businesses should operate, handle workers, pay taxes, and protect data. The Gulf region has multiple countries with their own regulatory systems.
Solutions:
Team up with firms that specialize in Gulf business regulations.
Outsourcing contracts should line up with local labor laws.
Data Security
The region is currently developing into a technology and digital services hub, this growth will also present increasing threats to cybersecurity that could affect businesses.
Solutions:
Pick secure cloud solutions.
Businesses should put worldwide cybersecurity plans into action to ensure their outsourced work meets industry standards.
Case Studies: Companies Successfully Outsourcing
BPC offers SaaS and on-site banking, payment, and e-commerce solutions. BPC partnered with ScienceSoft, an IT services provider with more than 13 years of experience. ScienceSoft took charge of providing L2–L3 infrastructure support, which covered network management, Microsoft and Atlassian systems support, and SharePoint optimization.
Through this collaboration, BPC successfully optimized its in-house workload, improved issue resolution speed, and enhanced system performance through strategic infrastructure upgrades.
Conclusion
The Gulf area is a viable place for the European and North American companies to outsource IT services. Outsourcing to the Gulf indicates productivity and innovation improvement.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Arabian Post
an hour ago
- Arabian Post
EU Intensifies Oversight of Musk's xAI–X Deal
European Commission regulators have launched an in-depth inquiry into the corporate restructuring of X following its $33 billion acquisition by Elon Musk's AI venture, xAI in March. Officials have issued formal information requests probing whether the deal reshaped the obligations and liabilities under the Digital Services Act, which could trigger fines of up to 6 per cent of global turnover or even a suspension of operations within the EU. At stake is not merely compliance but scope. Brussels is examining if revenue from Musk's wider corporate empire—including xAI, SpaceX, Neuralink and The Boring Company—should be aggregated with X's earnings when calculating any DSA penalty. Such consolidation would dramatically increase the financial stakes, positioning the potential fine among the largest ever under the regulation. This intensified scrutiny builds upon a probe initiated in December 2023 over allegations that X failed to curb harmful content and employed deceptive design. The spotlight has honed in on features such as the blue check verification, which critics say misled users into attributing credibility purely on subscription status. X has contested these accusations, reflecting the gravity with which Brussels regards compliance under the DSA. ADVERTISEMENT Regulatory sources indicate that Brussels aims to reach a decision before its summer recess in August 2025—though there remains a possibility that deliberations will extend. If a penalty is levied, whether tied solely to X or inclusive of Musk's other holdings, the platform could face a multi‑billion‑dollar bill. Repeat offenders risk more severe sanctions, including operational bans within the bloc. The commission's current line of inquiry follows earlier requests for internal documentation on X's algorithmic decision‑making and moderation protocols issued in January 2025, aimed at uncovering systemic bias or political amplification. EU digital chief Henna Virkkunen has signalled that the commission's enforcement of the DSA will be uniform across all major platforms—regardless of headline-grabbing personalities or companies. For the xAI–X merger, Brussels appears particularly concerned with whether the March acquisition alters liability thresholds or the classification of X as a 'Very Large Online Platform'—a designation that comes with more rigorous reporting and compliance obligations. The structure of the deal could influence if DSA fines are calculated based solely on X or on the broader Musk group. European digital regulators are keen to demonstrate the potency of the DSA, which took effect in late 2022, aiming to set a precedent in holding tech giants accountable across interconnected corporate structures. X's contested manoeuvres with the blue checkmark and structural repositioning have become emblematic of the challenges regulators face enforcing meaningful accountability. Musk's companies have so far declined to respond to the commission's most recent information requests. Meanwhile, EU officials continue to gather internal documents, revenue data and structural filings to determine the extent of exposure under DSA provisions before any final ruling.
Arabian Post
an hour ago
- Arabian Post
UAE Carriers Ground Middle‑East Services Amid Israel–Iran Strikes
Arabian Post Staff -Dubai Tel Aviv's Ben Gurion Airport remains closed with no clear reopening date, while Iran, Iraq and Jordan have shut their airspace and forced rerouting, cancellations and suspensions across the region. Abu Dhabi-based Etihad has cancelled its Tel Aviv flights until 30 June, with several Beirut and Amman services rerouted. Emirates has suspended routes to Tehran, Baghdad and Basra until at least 30 June, and flights to Amman and Beirut through 22 June. Flydubai has halted operations to Iran, Iraq, Israel and Syria until 30 June. Air Arabia and Wizz Air Abu Dhabi have also imposed temporary bans or schedule alterations for various Middle‑East destinations. A UAE Ministry of Foreign Affairs advisory urges citizens and residents to closely monitor airline updates and remain in touch with Twajudi, the national consular registration system for managing potential evacuations. ADVERTISEMENT Regional airports are adapting under pressure. Dubai, Abu Dhabi and Sharjah have filed emergency plans to minimise disruption, deploying field teams and enhanced passenger support to handle thousands of affected travellers. Europe-bound flights are now navigating narrow air corridors via Turkey and Egypt, adding hours to journey times, increasing fuel consumption and driving up operational costs amid rising Brent crude prices. Why airspace closures are widening disruption Closure of airspace over Israel, Iran, Iraq, Jordan and Syria forces airlines to detail-call costly detours. Regional carriers like Emirates, Etihad and flydubai are most affected, but even Western carriers—Lufthansa, Air France-KLM, Ryanair, Wizz Air—have suspended affected routes through summer. The cascading effect on schedules includes over 1,800 Europe-bound flight disruptions, approximately 650 cancellations, and delays across transatlantic routes. Airlines have expanded rerouting through Central Asia and the Mediterranean — and passengers are incurring higher ticket prices and longer travel times. Passenger assistance measures Major UAE carriers are offering rebookings, refunds or credits. Etihad and Emirates are assisting passengers with alternate routing, and flydubai has pledged support for stranded individuals. Wizz Air Abu Dhabi has suspended flights to Tel Aviv through 15 September, offering full refunds or rebooking. Safety remains top priority amid military skirmishes. EASA flagged high risks over conflict zones following missile exchanges between Israel and Iran, aligning with airspace closures through October in Syria and ongoing risks in Lebanon and Jordan. Wider implications for aviation and tourism Analysts warn disruptions may prolong as long-range military assets remain in play—fueling concerns about further airspace restrictions. Already, the Middle-East tourism boom has stalled, with summer travel projections for 2025 downgraded across the UAE, Saudi Arabia and Qatar. Airlines are adjusting summer schedules and revising revenue forecasts amid cascading delays and costlier operations. Governments and aviation bodies are in emergency sessions. The UAE's aviation regulator is coordinating with international counterparts, while civil aviation agencies across Europe are recalibrating route permissions and contingency plans—potentially impacting global air connectivity for weeks. Passengers are urged to monitor developments, confirm flight statuses directly with airlines or travel agents and consider flexible booking options as markets remain volatile.
TECHx
2 hours ago
- TECHx
DEWA, Microsoft Advance AI and Cloud Collaboration
Home » Smart Sectors » DEWA, Microsoft Advance AI and Cloud Collaboration Dubai Electricity and Water Authority (DEWA) has announced a strategic meeting between HE Saeed Mohammed Al Tayer, MD & CEO of DEWA, and Naim Yazbeck, General Manager of Microsoft UAE. The meeting aimed to explore new opportunities for collaboration in digital transformation, artificial intelligence (AI), and cloud computing within the utilities sector. During the meeting, both parties discussed ways to leverage Microsoft's advanced technologies to support DEWA's innovation-driven initiatives. They focused on enhancing operational efficiency and accelerating next-generation infrastructure aligned with the Dubai Clean Energy Strategy 2050 and the UAE Net Zero by 2050 Strategic Initiative. It was reported that both DEWA and Microsoft reaffirmed their commitment to harnessing Fourth Industrial Revolution technologies. Their goal is to improve service quality, strengthen cybersecurity, and enhance customer experiences. Al Tayer revealed that DEWA is working to become the world's first AI-native utility. He said the collaboration with Microsoft is instrumental in achieving this goal. He noted, 'By integrating AI and cloud-based solutions, we aim to enhance our renewable energy capabilities, drive operational excellence, and provide world-class services that support Dubai's sustainability and innovation goals.' Yazbeck stated that Microsoft is proud to support the UAE's vision of a strong, digitally powered economy. He added, 'Our work with energy leaders like DEWA enables us to co-develop transformative solutions that redefine energy management and advance sustainability.' In addition, DEWA has adopted advanced generative AI tools as part of its digital evolution. These include: Microsoft Power Platform Microsoft 365 Copilot These tools have significantly improved internal productivity, service delivery, and overall satisfaction for both employees and customers. DEWA began using AI technologies as early as 2017. It was among the first utilities globally to implement Microsoft's Copilot platform, further highlighting its commitment to innovation and sustainability. Source: Dubai Media Office
