Egypt’s non-oil business sector contracted for the third straight month in December but at a slower rate as output, new orders and employment shrank at a slower pace, a survey showed on Sunday.
Egypt’s monthly Purchasing Managers’ Index (PMI), a proxy for growth in the country’s non-oil sector, posted 48 last month, up from November’s low of 45. Any score below 50 indicates that the economy is contracting.
The index is sponsored by the Dubai-based lender Emirates NBD and produced by the data provider Markit.
“The recovery in the December PMI data is encouraging and suggests that the weak November survey was at least partly due to temporary factors, affecting tourism and external demand,” said Tim Fox, the chief economist at Emirates NBD, in the report.
The average PMI for the fourth quarter of last year as a whole was 46.8, the lowest since the third quarter of 2013, the year that Mohammed Morsi was ousted from power.
Egypt is struggling to revive its fortunes since the 2011 revolution. The economy is grappling with a currency crisis and a shortage of foreign currency. Compounding the situation is terrorism that has hit its tourism industry, denying the country a major source of foreign currency earnings.
Egypt’s economy grew by 4.2 per cent in the last fiscal year, 2014-15, and is forecast to grow by 4.3 per cent this fiscal year.
Output and new business shrank for the third month in a row, with work contracting because of security issues, affecting exports. New business from abroad has been affected by foreign clients being cautious after the downing of the Russian plane over the tourist destination of Sinai last October.
Non-oil private sector employment also fell for the seventh consecutive month as job cuts were sustained and workers left their jobs to look for better prospects.
Separately, Egypt’s annual urban consumer inflation in December was 11.1 per cent, remaining unchanged from the previous month, the official statistics agency, Capmas, said on Sunday.
dalsaadi@thenational.ae
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