Lebanon’s Purchasing Managers’ Index (PMI) ended the year with further contraction following the continuous instability on the Lebanese political scene and signaling a worsening activity within the private sector. The weakness of the PMI came on the back of lower new orders as well as diminishing output. Commenting on the December 2017 PMI results, Dr Ali Bolbol, Chief Economist of BLOM Bank: Still reverberating from the political shock of Prime Minister Hariri’s resignation in early November 2017, the December 2017 BLOM Lebanon’s PMI stood at a lowly 46.1, despite the withdrawal of the resignation in late November 2017. Only employment seems to have held steady, against faster declines in output, exports, and new orders. More disturbing is the deterioration in future expectations, in spite of the political settlement brokered by the French president and the Council of Ministers’ approval to start oil and gas exploration next year. It looks like the government will have its hands full to reverse these expectations through serious reforms and growth measures, and to do that soon and not wait till after the parliamentary elections in May 2018.
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