How Lebanon + Kuwait + Qatar’s non-oil private sectors fared in March: Purchasing manager indices (PMI) tracking non-energy sectors saw varying results in the three countries in March, with Kuwait and Qatar seeing improved business activity that kept them above the 50.0 mark threshold, while Lebanon’s non-oil private sector fell to a five-month low that put it back in the red.

REMEMBER- The all-important 50.0 mark is the threshold separating contraction from growth. Anything above 50 denotes expansion, while anything below indicates contraction.

First up, Lebanon: Lebanon’s non-energy private sector growth slowed down at its quickest pace since October, as new business intakes fell in tandem with a renewed decline in output and employment, according to Blominvest Bank’s Lebanon PMI (pdf). The nation’s headline figure came in at 47.6, down from 50.5 in February, in what is the nation’s first month in the red following its two-month streak in expansion territory.

New order intakes were down, which surveyed firms attributed to lower purchasing power among clients, as well as a reluctance from consumers to spend on non-essential goods and services. Sales to overseas customers also fell during the month, due to a combination of challenging shipping conditions, high export costs, and regional instability.

Both internal and external factors led to an atmosphere of instability for the economy: “The spillover effects from clashes on the Syrian coast, to renewed escalation between Israel and Hezbollah, to delays in the disarming of the latter have all left their de-stabilizing imprint on the Lebanese private sector,” Blom Chief Economist Ali Bolbol said. This, coupled with a continued delay in the new government’s appointment decisions led to an apparent “change of course in the economy toward instability,” he added.

Firms’ purchasing activity also declined during the month, with buying volumes remaining largely unchanged from February. Meanwhile, input prices were on the rise, with “foodstuff, metals, medical supplies and imports all cited as sources of inflationary pressures.” This led to the continued increase in overall operating expenses — which, in turn, led to output prices going up for the tenth consecutive month.

Despite the decline in non-oil activity, businesses remain confident: Private sector firms’ growth expectations remained among the most optimistic in the country since the survey began in May 2013, with many citing hopes for a recovery in demand. “The only worthwhile news from the March PMI results is that expectations of a better outlook are still positive, though at a more subdued level,” Bolbol said.

Over in Qatar: Qatari non-oil private sector’s growth maintained its momentum in March, in what was the “strongest overall improvement in business conditions in the non-energy private sector economy of 2025 so far,” according to Qatar Financial Center PMI (pdf). The nation’s headline figure rose to 52.0, up from 51.0 in February, sending Doha even more comfortably above the 50.0 threshold indicating growth.

New orders were on the rise during the month, marking the first such rise of the year, while overall business activity came in lower than in February due to a slow period in the construction sector. Meanwhile, firms’ purchasing activity rose during the month, with companies rebuilding their inventories as the overall economic outlook strengthened.

Employment continued to have the strongest contribution to Qatar’s PMI performance, but came in lower than February’s all-time high of 61.9. This extended the country’s current run of positive job creation to eight consecutive months, with workforce growth remaining strong across all sectors. Similarly, average wages and salaries increased at one of the highest levels on record — but did so at their slowest pace in four months.

Qatari businesses remain optimistic: “Qatari firms were increasingly confident regarding the 12-month outlook. Sentiment was among the highest registered over the past two years, and above the long-run survey trend. Anecdotal evidence linked growth forecasts to improving economic conditions, growth in real estate and construction, government development initiatives, population growth – including expats – and tourism,” the report reads.

Meanwhile, in Kuwait: Non-oil activity in Kuwait continued to expand at an even more pronounced pace in March, with the country recording its seventh consecutive month above the 50.0 mark for healthy growth, according to S&P Global’s PMI (pdf). Kuwait’s headline reading came in at 52.3 in March, up from 51.6 in February, in what is its second-best outing of the year so far.

New orders saw a “sharp and accelerated rise” during the month, driven by improved demand from clients, new product offerings, and competitive pricing. New export orders were also on the rise, increasing at their fastest pace in a year. Meanwhile, Kuwaiti non-oil firms increased their purchasing activity following a fall in February, as companies looked to complete customer requests in a timely manner. Output also increased at a faster rate than it did during the previous month.

Input costs also rose markedly in March, which was mainly reflective of higher purchase prices. This only led to a marginal increase in output prices, with the pace of inflation seeing only a slight increase. Firms’ purchasing activity slowed, however, continued to decline — albeit at a softer pace than they did in February, which was attributed to both the increases in the prices of inputs and firms having sufficient inventory holdings.

Employment also bounced back following a marginal dip in February, as companies “responded to higher new orders and made efforts to complete projects on time.” However, staffing levels appeared to once again be insufficient to keep on top of workloads on the back of a rise in new orders, with backlogs of work having accumulated for the sixth month running.

The outlook remains positive: “Non-oil companies in Kuwait remained optimistic that output will increase over the coming year, with confidence hitting a three-month high in March. More than 34% of respondents predicted activity to expand, linked to the impact of new marketing strategies and the offer of good quality products at competitive prices.

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