Business activity in Egypt shrank for the third month in a row in December, a survey showed, though at a slower pace than the previous month as the contraction in output, new orders and employment eased. Egypt has been struggling to revive its economy since a popular uprising in 2011 drove both investors and tourists away, depriving the country of foreign currency it needs for importing raw materials. In a survey, the Emirates NBD Egypt Purchasing Managers Index (PMI) for the non-oil private sector rose to 48.2 points in December from 45 points in November, remaining below the 50-point mark that separates growth from contraction. Output levels dropped for the third month with an index reading of 48.2 points in December, but the rate of decline was less than November's 42.7, the survey said, adding that nearly 24 percent of panellists noted a drop in output, with a number pointing to the fragility of client demand. New orders also fell for the third straight month but at the slowest rate in as many months. "After having quickened to the most marked since September 2013 in the prior month, the pace of decline was only modest and weaker than the average recorded over the survey's history," the survey said. Egypt has been facing a currency crisis that economists blame on an over-valued pound. The central bank had been gradually weakening the pound, but then surprised markets by strengthening it by 20 piasters against the dollar to 7.7301 pounds, still far from the black market rate of 8.5 pounds. The survey showed declines in employment for the seventh consecutive month to 46.5 points in December compared with declines of 45 points the month before. "Although easing since the prior month, the rate of job cuts remained solid overall. Staff retirements contributed to the fall in payroll numbers, while some workers left in order to search for better job opportunities," the survey said. Egyptian President Abdel Fattah al-Sisi had pledged to reduce the jobless rate to 10 percent over the next five years. Unemployment stood at 12.8 in December, according to the government's statistics agency. Analysts believe it may be much higher. Detailed PMI data is only available under licence from Markit and customers need to apply to Markit for a licence. Source: Reuters
