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Zambia’s private sector showed signs of recovery as the Purchasing Managers’ Index (PMI) rose to 50.8 in December, up from 49.2 in November.
This marked the fastest growth in the private sector since July 2023, ending a 12-month decline in business conditions.
According to the PMI released by Stanbic Bank, the improvement was driven by stronger new orders, employment expansions, and increased purchases, although these gains remained modest as firms adjusted to more stable energy supplies.
“Although firms remained optimistic about future output, the level of optimism dropped to its lowest since March, with hopes centred on stronger demand conditions for the year ahead.
“Business activity fell for the thirteenth month running, but the pace of decline eased to the slowest in 2024 amid more upbeat demand and more stable electricity supplies,” the survey indicated.
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The survey also highlighted intensified cost pressures, with overall input prices rising at a faster pace due to increases in staff and purchase costs. However, the rate of charge inflation eased to its slowest since February.
Despite the modest improvements, Zambian firms reported a decline in optimism in December, with sentiment falling to its lowest level since March.
The Stanbic Bank Zambia PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in approximately 400 private sector companies.
These firms are selected to accurately represent the structure of the Zambian economy, including agriculture, construction, industry, services, and wholesale and retail.
Survey responses reflect the change, if any, in the current month compared to the previous month, with data collected mid-month.
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