Egypt business activity shrinks for 12th month

Most of Egypt has been under nighttime curfew since mid-August, when security forces broke up sit-ins of supporters of President Mohammad Mursi, deposed by the army on July 3.

More than 1,000 people died in clashes in July and August between security forces and Mursi supporters.
The seasonally adjusted HSBC Egypt Purchasing Managers Index (PMI) for the non-oil private sector stood at 44.7 points in September.

That was up from 42.2 in August, the third-lowest reading since the survey began in April 2011, but still well below the 50 mark separating growth from contraction, the survey of around 350 private sector firms showed.

“It’s a disappointing reading that underscores how long and difficult Egypt’s road to recovery may prove to be,” Simon Williams, chief Middle East economist at HSBC, said in a statement accompanying the poll results.

“Support from overseas can offer the currency some immediate relief, but as this month’s PMI shows, it will take more fundamental changes inside Egypt itself for private sector activity to normalize.”

Saudi Arabia, Kuwait and the United Arab Emirates pledged Egypt $12 billion in aid days after Mursi’s removal and have indicated they are prepared to send more.