An acceleration in the growth of new orders led to a surge in non-oil business activity in the United Arab Emirates in April, a business survey showed on Wednesday.
The seasonally adjusted S&P Global UAE Purchasing Managers’ Index rose to 56.6 in April from 55.9 in March, the highest in six months, signaling further improvement in the Gulf state’s non-oil economy.
The sub-index for New Orders jumped to 59.9 in April from 56.2 the previous month, the fastest pace of growth in new business since November 2021, due mostly to domestic demand.
“The UAE PMI rose for the third month running in April to signal an even stronger rate of expansion across the non-oil economy, driven by rapidly increasing new orders and retreating inflationary pressures,” said David Owen, senior economist at S&P Global Market Intelligence.
“Efforts to improve services and boost marketing also underlined growth, according to panelists, and supported a robust expansion in activity.”
The Output sub-index rose to 62.7 last month, up from 62.2 in March and the highest pace of growth since October 2022, and although employment activity softened from March, the sub-index remained above 50, signaling continued growth in jobs.
The UAE, the second biggest economy among GCC members, will grow 3.7 percent in 2023 and 4.0 percent next year, significantly lower than 7.6 percent last year, according to the latest Reuters poll of 16 economists. read more
It has embarked on an economic transformation plan to diversify revenue away from hydrocarbons and invest significantly in non-oil activities, including positioning itself as a global trade and logistics hub.
The rapid acceleration in new order growth also increased business confidence among firms for the outlook over the next 12 months.