Saudi Arabia and the UAE both recorded a drop in private non-oil business activity in April, according to IHS Markit’s Purchasing Managers’ Index (PMI).
Both countries' economies are being hit hard by the lockdown measures at home and abroad in place to combat the COVID-19 coronavirus pandemic, with many businesses shuttered and consumers told to stay at home.
“The full month of lockdown measures and business restrictions led to a steep decline in UAE non-oil private sector activity in April. Shop closures and restrictions in domestic and international travel had huge repercussions on new business, which fell at an unprecedented pace after also declining sharply during March,” said David Owen, an economist at IHS Markit.
The UAE’s PMI fell to 44.1 in April, below the 50-point threshold representing a decrease in activity for the sixth successive month. The figure also set a record low for the country for the second month in a row.
Saudi Arabia’s PMI was up slightly in April to 44.4, compared to 42.4 in March. The data, however, signaled a record decline in private sector business activity, with the fall attributed to business closures and shrinking demand.
“Saudi Arabian private sector output fell at the fastest pace since the survey began more than a decade ago, reflecting widespread business closures and a sharp reduction in customer demand,” said Time Moore, the economics director at IHS Markit.
Some businesses did record growth, however, with increased spending on healthcare products and services generally cited as the reason why.
“Survey respondents remain very cautious about their prospects for the year ahead, with business sentiment lifting only very fractionally from the record low seen in March,” Moore concluded.
Saudi Arabia reported its death toll from the coronavirus rose to 191 on Monday, with total infections hitting 28,656. The total number of recoveries in the Kingdom also rose to 4,476.
Meanwhile, in the UAE 11 more patients died from the virus, bringing the total death toll to 137, with total cases at 14,730 and 2,966 recoveries.
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