The Stanbic IBTC Bank Purchasing Managers Index (PMI) for December 2023 showed a significant improvement, reaching 52.7 compared to the previous month’s 48.0. This PMI serves as a reliable indicator of economic conditions, summarizing changes in the working conditions of private companies across various sectors. These sectors include agriculture, mining, manufacturing, construction, wholesale, retail, and services. A PMI below 50 indicates a contraction in the private sector, while a value above 50 signifies expansion.

With a PMI of 52.7, we can observe a positive expansion in output, which is a welcome change after three months of contraction. This growth can be attributed to increased output and new orders, driven by a recovering customer demand. As a result, job creation, backlogs of work, and vendor performance have all seen improvements. However, the wholesale and retail sectors have experienced a decline in investor confidence.

To restore investor confidence, it is crucial for the government to create a favorable investment climate through policy adjustments and transparent communication. Additionally, addressing infrastructure challenges, such as electricity, is essential to sustain the expansion of output. Furthermore, supporting businesses in adopting new technologies and practices that contribute to growth will also play a vital role in maintaining this positive momentum.