UAE new order growth slows
Dubai, December 5, 2011
Growth in business activity in the UAE's non-oil private sector eased in November because of a weaker rate of new orders and slower job creation, a purchasing managers' survey showed on Monday.
The HSBC UAE Purchasing Managers' Index (PMI), which measures the performance of the country's manufacturing and services sectors, fell to 52.5 points in November from a revised 53.4 points in October, which was a four-month high.
The index remains above the 50-point mark which separates growth from contraction, the survey of 400 private sector firms showed.
"The private sector is still expanding but the weaker PMI suggests the economy is struggling to maintain momentum," said Simon Williams, chief economist for the Middle East and North Africa at HSBC.
"The soft new export orders reading is a particular worry given how reliant the open UAE economy is on external demand."
Growth in new export orders hit a ten-month low of 52.6 points in November. Overall new order growth also slowed, to 56.2 points from October's four-month high of 58.4 points, but still remained above the series trend.
UAE firms continued hiring but employment growth decelerated slightly in November. However, the seasonally adjusted output index climbed to a five-month high of 54.9 points.
Analysts polled by Reuters in September predicted the UAE's economic output would expand by 3.8 percent this year and at the same clip in 2012, after a 1.4 percent rise in 2010.
Economy Minister Sultan bin Saeed Al-Mansouri said in mid-November that the UAE could grow about 4 percent next year if effective steps were taken to support the European and US economies, but that local growth would be around 3 percent if those economies remained unstable. - Reuters