As per the recent reports of the index survey by the Emirates NBD Purchasing Managers, business activity for the UAE’s non-oil sectors have witnessed a fast expansion since August 2018. With the increase in overall output, as per reports by panellists, the UAE companies now saw more opportunities for order and increased promotional activities.
In coordination with the International Monetary Fund, the NBD survey thus agrees that by that the year 2019, the non-oil sectors will observe more expansion on the fiscal stimulus and be ready for the preparations of the Expo 2020 Dubai.
As per the reports of the index, initially, in December the UAE’s business readings stood at 54.0. However, by January, it recovered to 56.3, providing the 1st month or 2019 with the highest PMI reading in the past 7 months. According to the leader of Mena Research at Emirates NBD, Khatija Haque, the main reason contributing to the higher headline index was faster output growth along with new orders that led the companies to look for more labour force.
Now, as more and more orders started coming in, the need for a suitable workforce to improve productivity increased. Several companies hence took on extra staff in January to improve productivity. As a result, the number of sales went up due to excess production of services and products.
Additionally, with the decrease in pre-production inventory stock, it shows that companies are also effectively managing their inventories and not building up a catalogue for future demands. Now, with the increase in demand and abundant supply, the index report further shows that almost 68% of the UAE firms are now confident that profit is certain in the year 2019. Further, some of the companies are providing effective price discounting which is also said to donate to the increased demand for products and contribute to overall productivity growth.