The growth in the United Arab Emirates’ non-oil private sector dipped to a 40-month low in December 2015 after being weighed down by a muted growth in new work, a survey showed.
The seasonally adjusted Emirates NBD UAE Purchasing Manager’s Index, which helps gauge the operating conditions in the private sector, fell from 54.5 in November 2015 to 53.3 in December.
“The PMI data points to weaker domestic and external demand in Q4 2015 which is reflected in lower readings for new orders, employment, output and the backlogs of work,” said Emirates NBD’s head of MENA research Khatija Haque.
Although new orders for businesses grew in December, the index noted that the growth was the slowest in the last four and a half years.
A muted rate of job creation also pulled down the overall performance of the private sector, the PMI showed.
“Indeed for 2015 as a whole, the average PMI was lower than for 2014, signalling slower – but positive – growth in the non-oil private sector. However, softer non-oil growth in the UAE last year is likely to have been partially offset by robust oil sector expansion, and we remain comfortable with our estimate of 4 per cent real gross domestic product growth in 2015 down from 4.6 per cent in 2014.”
Meanwhile non-oil business growth in Saudi Arabia was at the weakest pace in the survey’s history. The seasonally adjusted index fell to 54.4 points in December from 56.3 points in November. The growth in the kingdom was weighed down by a slower expansion of output, new orders and employment.