Egyptian business activity returned to growth in November, putting an end to a 13-month downturn as the country moves towards a constitutional referendum and elections, a survey showed on Wednesday.
In mid-November Egypt lifted a nighttime curfew that had lasted three months after security forces broke up sit-ins in support of President Mohamed Mursi, deposed by the army on July 3 following mass protests against his rule.
Hundreds of people have died in clashes between security forces and Mursi supporters since he was ousted.
The seasonally adjusted HSBC Egypt Purchasing Managers Index (PMI) for the non-oil private sector rose to 52.5 points in November, up from 49.5 points in October, stepping above the 50 mark separating growth from contraction.
That marked the strongest improvement in operating conditions since the survey of around 350 private sector firms began 32 months ago.
“The November survey gives us the first concrete evidence that the real economy has started to find its feet,” Simon Williams, chief Middle East economist at HSBC, said in an accompanying statement.
“It will take time to reverse the heavy losses of the past year, and many difficult challenges lie ahead. But provided political order holds, I’m hopeful recovery will gradually pick up steam.”
A panel has now finished rewriting Egypt’s constitution – suspended after Mursi’s ouster – and is expected to put it to a referendum, an important step on an army-backed route towards parliamentary and presidential elections next year.
Saudi Arabia, Kuwait and the United Arab Emirates pledged Egypt $12 billion in aid days after Mursi’s removal. Cairo is to host an Egyptian-Gulf Arab investment forum on Wednesday and Thursday, raising expectations of further dollars flowing into the country.
The index for output rose to 54.0 points in November from 50.5 in October, the second period of month-on-month growth since September 2012, the survey showed.
The subindex for new orders bounced back to growth, improving to 54.7 from October’s 49.3. The new export orders gauge also rose into expansion territory, climbing to 50.3 from 48.3 in October.
Businesses cut staff at the same rate as last month, with the employment index remaining at 49.0, the survey showed.
Companies raised their output prices, with the related index going up to 50.3 from 48.4 in October, pushed up by increased input costs, the survey showed.
Egypt’s urban consumer price inflation rose to its highest since July 2011 reaching 10.4 percent in October, up from 10.1 percent the previous month.