In June 2023, Kuwait’s non-oil sector experienced a significant growth, with business activity and new orders reaching their highest levels in seven years. This expansion was driven by successful advertising strategies, increased marketing efforts, and competitive pricing policies. The rise in new orders, both domestic and foreign, was particularly noteworthy, marking the fastest growth since the survey began in September 2018.
Employment in the non-oil sector also saw a surge, with companies hiring additional staff at the fastest pace since 2018. Despite this increase, the rate of job creation was still modest, and the accumulation of backlogs of work continued due to the strong growth in new orders. The rise in outstanding business was among the steepest in the series’ history.
Input costs, however, continued to rise sharply, although at a slower pace than in previous months. The increase was primarily due to higher spending on advertising, higher transportation costs, and rising prices for air conditioning and vehicle maintenance. Inflation, on the other hand, eased for the third month in a row, reaching its weakest level since the beginning of 2024. Staff cost inflation, however, hit a three-month high.
The increase in new orders also led to an expansion in purchasing activity. Some firms even bought items in bulk to raise their inventories. Both input buying and stocks of purchases increased more quickly in June than in May.
Despite the challenges, Kuwait’s non-oil sector businesses remained optimistic about the yearly outlook for business activity, with confidence supported by the success of marketing and improving economic conditions. For more updates on the economy, visit our economy news section.
