Kiteworks, which empowers organisations to effectively manage risk in every send, share, receive, and use of private data, today released its Data Security and Compliance Risk: 2026 Forecast Report. A comprehensive analysis revealing that Middle East organisations have made significant strides in data sovereignty infrastructure, but lag on the governance controls needed to manage AI-era risks.
The research, based on a survey of security, IT, compliance, and risk leaders across 10 industries and 8 regions, exposes a fundamental gap between sovereignty capability and governance execution in the Middle East. Whilst UAE leads on data localisation and cross-border mechanisms (55% to 62% adoption), critical governance controls remain underdeveloped: UAE shows 54% AI anomaly detection versus Saudi at just 32%, a 22-point regional gap. Only 19% of UAE organisations and 12% of Saudi organisations have joint incident playbooks with AI vendors.
“The Middle East has moved faster than any other region on data sovereignty infrastructure. Localised data centres, cross-border controls, regulatory frameworks. That’s real progress,” says Dario Perfettibile, GM of EMEA GTM & Customer Operations, Kiteworks. “But governance controls how data is used, who accesses it, and what happens when things go wrong. The gap between sovereignty investment and governance maturity is where risk accumulates. And that gap is widest around AI vendor relationships and incident response capabilities.”
The report identifies five predictions for Middle East organisations in 2026:
1. AI-specific incident response will remain uneven across the region. UAE leads at 54% AI anomaly detection, but Saudi trails at 32%. A 22-point gap that creates a fragmented regional security posture. Organisations operating across both markets face inconsistent protection.
2. Third-party AI vendor risk will be recognised but under-controlled. 56% of UAE organisations cite AI vendor risk as a top concern, yet only 19% have joint incident playbooks. Saudi shows the same pattern: 48% concern, 12% playbooks. Awareness without action is exposure.
3. Software supply chain controls will remain sector and country skewed. Saudi trails global averages on every supply chain metric: SBOM adoption at 22% versus 28% global, secure SDLC at 34% versus 41% global. UAE performs better but still shows gaps – 62% lack SBOM coverage.
4. Compliance automation will remain incomplete. 48% of UAE organisations lack full compliance automation; 62% of Saudi organisations still rely on partial or manual processes. As regulatory scrutiny intensifies, manual compliance won’t generate the continuous evidence auditors expect.
5. Key AI risks will be underweighted relative to global peers. Saudi organisations cite training-data poisoning as a top concern at just 22% versus 29% globally, and PII leakage at 24% versus 32% globally. Lower concern doesn’t mean lower risk, it means lower preparedness.
The gap between UAE and Saudi Arabia on multiple metrics – anomaly detection, SBOM adoption, compliance automation – suggests that regional progress is uneven. Organisations with cross-border operations face the challenge of managing different maturity levels across markets, creating governance complexity that sovereignty infrastructure alone cannot address.
The global report, which includes 15 predictions across data visibility, AI governance, third-party risk, and compliance automation, identifies “keystone capabilities” – unified audit trails and training-data recovery – that predict success across all other metrics, showing up to 32-point advantages for organisations that have implemented them. The Middle East’s strong performance on cross-border mechanisms (55-62%) demonstrates capability that can be extended to other governance domains.
“Sovereignty is table stakes for the Middle East—and organisations have invested accordingly. The next phase is governance maturity,” adds Perfettibile. “Controlling where data lives is necessary but not sufficient. Controlling how AI vendors use that data, how incidents are detected and responded to, and how compliance is demonstrated continuously. That’s where the Middle East’s next infrastructure investment needs to focus.”
