Egypt non-oil private sector expands for 3rd consecutive month

However, the headline PMI for January dropped below the 50 no-change mark to 49.8, down from 50.2 in December 2025, signalling weakened operating conditions yet indicating a strong pace of non-oil GDP growth, according to the S&P Global report on Egypt.

Business activity and stock purchases increased, which helped support the PMI, but this was offset by a decline in new orders and employment, along with longer supplier lead times.

Outputs increased slightly despite easing demand abroad and order volumes, which remained strong but not at the same level seen in December, “although setbacks in demand at other companies meant that total order books slipped slightly,” according to S&P Global Senior Economist David Owens. Overall sales also declined slightly after two months of growth.

Companies were able to address outstanding orders in January, with backlogs falling at the fastest pace in almost three years. Owens said this “indicates that firms may have less room to expand in the coming months if sales volumes remain broadly stable.” As a result, firms reduced hiring, leading to the largest decline in employment since October 2023.

Overall input purchasing for non-oil firms fell slightly after rising for the first time in 10 months in December.

Stock volumes, however, increased for the first time since September 2025. Non-oil companies also lowered their overall selling prices in January. While prices for metal and fuel rose, the overall rate of input price inflation slowed.

Selling prices in January fell for the first time in five years, reflecting smaller increases in operating expenses. Purchasing costs and staff wages also rose, but at a slower pace than in December.

Looking ahead, S&P Global said conditions in Egypt’s non-oil private sector are expected to remain marginally positive over the next 12 months, with companies approaching activity cautiously.

In 2025, Egypt’s private sector secured a total of $2.9 billion (about EGP 136.5 billion) in financing and received around $300 million (approximately EGP 14.1 billion) in development grants.