UAE’s non-oil sector records faster expansion in December

The UAE’s non-oil sector expanded at its fastest pace in nine months in December. The S&P Global UAE Purchasing Managers’ Index (PMI) rose to 55.4 from 54.2 in the month before. This has been possible due to strong demand and more businesses.

The seasonally adjusted PMI remained more than the 50 mark that separates progress from contraction. It has also been the third monthly increase in a string. The fresh orders subindex rose to 59.3 from 58, suggesting robust demand.

Need to boost resources to ensure firms capitalise on demand

Nonetheless, export demand noted a bit of softening. Backlogs also continued to accumulate at a rapid pace in December, reported Reuters. Capacity levels are under a lot of stress, illustrated by another phase of increase in backlogs, said an expert.

The senior economist at S&P Global Market Intelligence also highlighted that margin constraints appear to be holding some companies back from recruiting more employees, adding that there is a need to boost resources to ensure firms capitalise on demand.

There has been a notable spike in demand. But the rise in employment remained sluggish. Job creation needs to pick up as soon as possible. But input cost inflation eased, offering some relief to businesses as firms continued to discount prices amid competition.

UAE’s booming non-oil sectors, highlighted by OPEC report

In one of its Monthly Oil Market Report last year, the Organisation of the Petroleum Exporting Countries (OPEC) reported that the UAE’s non-oil sectors such as real estate, manufacturing and tourism continue to record better performance.

It had been reported around mid-year that the Dubai International airport is on track to handle a record 91.8 million passengers in the year, higher than the earlier forecast, despite serious geopolitical issues troubling people across the globe.