Saudi Arabia is seeing signs of recovering from the consequences of Corona

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Saudi Arabia is seeing signs of recovering from the consequences of Corona

Reuters

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A survey showed that business activity in the non-oil private sector in Saudi Arabia reached a peak of 3 months in April, and employment activity grew for the first time in 5 months, as the Kingdom is witnessing signs of recovery from the consequences of Corona.

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The IHS Market PMI in the Kingdom, adjusted in light of seasonal factors, rose to 55.2 in April, from 53.3 in March, to remain above the 50 level, which separates growth from contraction, for the eighth month in a row.

“Saudi Arabia’s PMI rebounded in April, indicating that growth in various aspects of the non-oil economy has strengthened. New orders increased at the fastest pace in three months, while continuing,” David Owen, an economist at IHS Markit, said. Covid-19 Business Conditions Recovery “.

The production sub-index advanced to 58.7 in April, from 56.2 in March, while growth is largely related to the increase in new orders.

The surge in demand has prompted companies to increase the number of employees for the first time in five months, and at the fastest pace since November 2019.

The expansion of the private sector is vital to the economic transformation plans supported by Saudi Crown Prince Mohammed bin Salman, to create jobs and end the world’s largest oil exporter’s dependence on crude revenues.

But despite the improvement in business conditions, the outlook for future activity was the weakest since last June, according to the survey.

“Business expectations have receded from their level in March, as fewer participants expected production growth in the next 12 months. The companies’ current concerns include another potential wave of Covid-19 that could exacerbate problems with foreign travel, ”Owen said.

The Saudi economy was hit hard last year by the twin shock of the Coronavirus crisis and lower oil prices.

The International Monetary Fund expects the Saudi economy to grow by 2.9 percent this year, after shrinking 4.1 percent in 2020.

Source: Reuters





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