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Non-Oil Sectors in Arab Nations Show Promising Growth in February
S&P Global reports indicate rising business activity across the non-oil private sectors in the UAE, Qatar, and Lebanon amid varying economic conditions.
In February, the non-oil private sector in the United Arab Emirates (UAE) demonstrated steady growth, driven by improved business conditions and an increase in new orders, as reported by S&P Global.
The purchasing managers' index (PMI) for the UAE remained steady at 55.0, slightly down from a nine-month high of 55.4 recorded in December.
A PMI reading above 50 indicates expansion in private business activities, while a reading below 50 reflects contraction.
Saudi Arabia reported a PMI of 58.4 for February, indicating robust growth, while Kuwait recorded a PMI of 51.6 and Egypt reached 50.1. David Owen, senior economist at S&P Global Market Intelligence, noted that the UAE's PMI reading suggests a consistent growth trajectory since the late 2022 peak.
Growth in business activity was attributed to rising new business levels, enhanced market conditions, effective advertising, and moderate output price pressures.
Nevertheless, concerns were raised among non-oil private companies regarding intense domestic and foreign competition, which limited growth in February.
Owen indicated that the sector faces challenges ahead, emphasizing the need for effective policy measures to address issues such as client payment delays.
Business activity growth in February surpassed the long-run average of 54.4, but the overall employment creation remained subdued with many firms opting to retain existing staffing levels.
In Dubai, the PMI slightly declined to 54.3, its lowest in three months, down from 55.3 in January, but continued to signal a solid improvement in the Emirate’s non-oil sector.
The non-energy sector in Dubai benefitted from increased demand, although the rate of input price inflation was the lowest in four months, leading to only a minor rise in average prices.
In Qatar, the non-oil private sector saw a PMI rise to 51.0 in February, its first increase in three months, from January's 50.2. The labor market in Qatar strengthened significantly, with record growth in employment as non-energy firms reported increased hiring.
The wholesale and retail sectors particularly showed strong recruitment trends, while overall business activity remained broadly stable.
Employment expectations contributed positively to the PMI outcome, indicating a continued optimistic outlook for the region.
In Lebanon, a report from S&P Global in collaboration with BLOMINVEST Bank indicated the country's PMI stood at 50.5 in February, marking a slight decrease from 50.6 in January.
The private sector sustained growth momentum, supported by increasing new business opportunities, particularly from international customers.
Notably, there was a resurgence in export orders.
The formation of a new, reform-oriented cabinet, following recent elections, contributed to optimism within the Lebanese business community, although security concerns were raised due to ongoing geopolitical tensions.
The report highlighted a renewed expansion in purchasing activities, the fastest observed in over a decade, amid rising operating costs and inflationary pressures.
The purchasing managers' index (PMI) for the UAE remained steady at 55.0, slightly down from a nine-month high of 55.4 recorded in December.
A PMI reading above 50 indicates expansion in private business activities, while a reading below 50 reflects contraction.
Saudi Arabia reported a PMI of 58.4 for February, indicating robust growth, while Kuwait recorded a PMI of 51.6 and Egypt reached 50.1. David Owen, senior economist at S&P Global Market Intelligence, noted that the UAE's PMI reading suggests a consistent growth trajectory since the late 2022 peak.
Growth in business activity was attributed to rising new business levels, enhanced market conditions, effective advertising, and moderate output price pressures.
Nevertheless, concerns were raised among non-oil private companies regarding intense domestic and foreign competition, which limited growth in February.
Owen indicated that the sector faces challenges ahead, emphasizing the need for effective policy measures to address issues such as client payment delays.
Business activity growth in February surpassed the long-run average of 54.4, but the overall employment creation remained subdued with many firms opting to retain existing staffing levels.
In Dubai, the PMI slightly declined to 54.3, its lowest in three months, down from 55.3 in January, but continued to signal a solid improvement in the Emirate’s non-oil sector.
The non-energy sector in Dubai benefitted from increased demand, although the rate of input price inflation was the lowest in four months, leading to only a minor rise in average prices.
In Qatar, the non-oil private sector saw a PMI rise to 51.0 in February, its first increase in three months, from January's 50.2. The labor market in Qatar strengthened significantly, with record growth in employment as non-energy firms reported increased hiring.
The wholesale and retail sectors particularly showed strong recruitment trends, while overall business activity remained broadly stable.
Employment expectations contributed positively to the PMI outcome, indicating a continued optimistic outlook for the region.
In Lebanon, a report from S&P Global in collaboration with BLOMINVEST Bank indicated the country's PMI stood at 50.5 in February, marking a slight decrease from 50.6 in January.
The private sector sustained growth momentum, supported by increasing new business opportunities, particularly from international customers.
Notably, there was a resurgence in export orders.
The formation of a new, reform-oriented cabinet, following recent elections, contributed to optimism within the Lebanese business community, although security concerns were raised due to ongoing geopolitical tensions.
The report highlighted a renewed expansion in purchasing activities, the fastest observed in over a decade, amid rising operating costs and inflationary pressures.
