UAE’s Non-Oil Private Sector Growth Slows Down in July
In a recent report, the UAE’s non-oil private sector growth showed signs of slowing down in July, marking its slowest improvement in almost three years according to an economy tracker.
Challenges Facing the Emirates’ PMI
The S&P Global Purchasing Managers’ Index revealed that the Emirates’ PMI slipped to 53.7 in July from 54.6 the previous month, as competitive conditions, rising price pressures, and capacity overloads weighed on performance.
Concerns for the Non-Oil Sector Growth
Chief economist David Owen stated that the drop in the UAE PMI indicates a downward trend in non-oil sector growth for 2024, with business capacity being a key challenge as firms struggle to resolve supply and administrative issues.
Price Inflation and Output Charges
Price inflation accelerated in July, with companies experiencing the fastest rise in input costs for two years. The report revealed that higher input prices were partially passed through to customers, leading to increased output charges for the third consecutive month.
Optimism for Future Growth
Despite the challenges, there is optimism about the future growth of non-oil businesses in the UAE in the next 12 months. The PMI suggests that the sector is expanding solidly and could strengthen if companies manage their workloads efficiently.
Egypt’s Non-Oil Economy on the Cusp of Expansion
Meanwhile, Egypt recorded a PMI of 49.7 in July, indicating that the non-oil economy is on the verge of expansion, with output and new business declining at marginal rates. Price pressures among Egyptian firms showed signs of intensifying as input costs rose at their steepest pace since March.
Kuwait’s Private Sector Maintains Momentum
In Kuwait, the non-oil private sector started the second half of the year positively, with the PMI standing at 51.5 in July. Despite challenges in finding skilled staff, new orders continued to increase at a solid pace, indicating confidence in future output growth.