Saudi non-oil private sector shrinks yet again, output hits new low: PMI

Saudi Arabia’s non-oil private sector contracted for the second consecutive month in April and its output hit a record low as lockdowns and business closures to tackle the new coronavirus affected the economy, a survey showed on Tuesday.

The seasonally adjusted IHS Markit Saudi Arabia Purchasing Managers’ Index (PMI) rose slightly to 44.4 in April from 42.4 in March, which was the lowest reading since the survey began in August 2009.

April is only the second time the headline index has fallen below the 50.0 mark that separates growth from contraction. The slight rise from March reflected “a slower reduction in new work and a stronger contribution from the suppliers’ delivery times component,” the survey compilers wrote in a report.

“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 Tim Moore, economics director at IHS Markit.

“Export sales and international supply chains were also severely impacted by the global COVID-19 pandemic in April, with both indices hitting survey-record lows,” he said.

As of May 3, Saudi Arabia had reported 27,011 cases of COVID-19, the disease caused by the new coronavirus, and 184 deaths – both the highest out of the six Gulf Cooperation Council countries.