Business activity in the UAE remained robust for the second straight month in November, leading to an increase in competition.

Businesses throughout the region were therefore increasing stocks to ensure they could meet demand, Gulf News reports.

There were “concerns that a large number of firms are entering the market,” according to David Owen, Senior Economist at S&P Global Market Intelligence.

“The build-up of competition was likely a key factor behind stock-building efforts, with businesses wary of falling behind in a fast-growing economy.”

The PMI (Purchasing Managers Index), tracking business activity and sentiment, ended November with a reading of 57, not far from October’s 57.7 score, a four-year high.

S&P Global added that for UAE businesses, “new orders remained well inside growth territory, with increased demand, new clients, project inquiries and marketing efforts reportedly driving growth.”

In regard to initial UAE economic forecasts for 2024, current momentum within the real estate and construction sectors should continue into next year, with growth also forecasted in tech, retail, and other sectors.

“The PMI signalled that operating conditions improved rapidly midway through the final quarter, supported by strong trends for new business, output and inventories,” S&P Global added.

UAE “firms looked to ensure they were in a good position to take advantage of growth opportunities,” Owen added. “Indeed, the uplift in buying – the fastest since July 2019 – supported the most rapid build-up of stocks in close to six years, benefitting both local businesses and trade partners.”

Furthermore, according to the latest PMI report: “The latest data pointed to a clear drop in confidence levels (among business owners). This was mainly due to concerns at some companies that competitive pressures could erode market share.

“With this in mind, staffing growth stayed relatively mild, while salaries also ticked up only slightly,” the report adds.