Egypt’s non-oil sector sees sharpest contraction in 2 years amid middle east tensions

Egypt’s non-oil private sector activity contracted at its fastest pace since April 2024, with the S&P Global Egypt Purchasing Managers’ Index (PMI) falling to 48.0 in March from 48.9 in February. The decline reflects weaker demand and rising costs linked to the ongoing Middle East conflict.

New orders dropped sharply, reaching a near two-year low, while input prices rose at the fastest pace since late 2024, driven by higher fuel and commodity costs and a stronger US dollar. Firms responded by raising output prices at the quickest rate in ten months.

Employment remained broadly stable, and purchasing activity edged up slightly after two months of decline. However, business sentiment turned negative for the first time in the survey’s history, with some firms predicting a fall in output over the next year.

Despite the downturn, S&P Global noted that the PMI reading still corresponds to annual GDP growth of around 4.3 per cent, suggesting the underlying non-oil economy remains on a moderate growth path.

Attribution: Amwal Al Ghad English