The Kingdom of Saudi Arabia’s non-oil sector is witnessing a boom in business activity, new orders and employment since the last month, a report said.
The Saudi Arabia Purchasing Managers’ Index recorded that the non-oil private sector economy fell to 56.9 in December from 58.3 in November. The reading remained above 50 level suggesting economic expansion, but business conditions have been weak for five months.
That said, the employment rate has grown for the ninth month in a row across the non-oil private sector. This in particular is with increasing staff recruitment owing to work backlogs last year. Also, import buying has exponentially increased.
Tim Moore, economics associate director at IHS Markit, told the media that, “The latest Saudi Arabia PMI points to a short-term setback for the non-oil private sector, with growth of business activity and new work slipping since November. However, the survey continues to indicate a much stronger improvement in business conditions than at the same time during 2018, particularly in relation to new order books.”
In December, the overall new business volumes increased. According to reports, the Kingdom is quite confident about its business outlook for 2020 compared to performances in mid-2019.
The Institute of International Finance (IIF), a global association of financial institutions, in a report predicted the Kingdom’s non-oil growth would remain at 2.7 percent in 2020. Further recovery in the sector coupled with interest rate cuts has encouraged the private sector economic activity to remain stable.