Economy
Second Biggest Arab Economy Falters as Firms See Orders Drop
(Bloomberg) — The United Arab Emirates’ economy is ending a difficult year on a low as business activity slumps to a level not seen in more than a decade.
New orders for companies in the second-biggest Arab economy fell for the first time on record in November as the impact of recent price cuts to stimulate demand waned. Output growth and payroll numbers also fell, according to the IHS Markit Purchasing Managers’ Index, which tracks the country’s non-oil activity.
The oil-rich country is grappling with low crude prices as well as global trade headwinds. A strong dollar is also hurting tourism and retail demand in Dubai, the country’s business hub.
Read: Global Downturn Is Starting to Gain a Foothold in the Gulf
“Price discounts that led to marked surges in demand earlier this year are now relatively ineffectual,” IHS Markit economist David Owen wrote. “While the overall decline in sales was marginal, it offered a first hint that the non-oil private sector might endure a period of contraction.”
The UAE’s PMI dropped to 50.3 in Nov. from 51.1 in Oct., hitting its lowest reading since August 2009 and nearing the threshold of 50 that separates contraction from growth.
It’s a stark diffidence from the index’s reading of 55.8 a year ago.
Read: Dubai employment growth improves to 21-month high
New orders fell to 48.9 in November from 51.1 in October, reversing a previous trend of expansion. Companies also continued to reduce selling prices and offer discounts amid strong competition.
The slump means companies are increasingly looking to Dubai’s World Expo next year as a catalyst to revive growth.
“Businesses remain positive that the Expo 2020 will bring a steady stream of demand to the sector,” Owen wrote. “With current conditions remaining subdued, it appears that such a boost would greatly benefit the economy.”
-
OER Magazines1 month ago
OER, September 2024
-
Alamaliktistaad Magazines2 months ago
Al-iktisaad, September 24
-
Uncategorized4 weeks ago
Oman Oil Marketing Company partners with Ihsaan Association to support its activities
-
Commodities1 month ago
Gold Rangebound as Investors Brace for Key US Economic Data
-
Banking & Finance1 month ago
Apple Pay Officially Launched in Oman
-
Oil & Gas4 weeks ago
OQEP Appoints United Securities as Liquidity Provider Ahead of Landmark MSX Listing
-
Investment1 month ago
With Over RO600M in Foreign Investments, Future Fund Oman Unveils the First Batch of Investment Projects with an Overall Value of RO830M+
-
Lifestyle1 month ago
Royal Opera House Muscat Welcomes First Shows of its 2024/25 Season