KABANDA CHULU, Lusaka
RECENT improvements in Zambia’s private sector business conditions have been sustained in August through further increases in output and new orders, an expert in global markets says.
Stanbic Bank Zambia head of global markets Victor Chileshe said the rate of job creation in private sector companies in Zambia has quickened to the fastest in more than two years.
The bank has developed the PMI in partnership with a London-based company, IHS Markit, a leading firm in the provision of information and analysis to support the decision-making process of businesses and governments around the world. Releasing the bank’s latest Purchasing Managers Index (PMI) report for August 2017, Mr Chileshe said the added capacity enabled companies to keep on top of workloads.
He said backlogs of work decreased for the second month running, and to the greatest extent since February.
“Companies reacted to higher workloads by taking on extra staff to the greatest extent in over two years.
“Meanwhile, cost inflation remained historically muted. This enabled companies to lower their output prices as part of efforts to attract customers,” Mr Chileshe said.
On the index, readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 shows deterioration. For August 2017, the PMI registered above the 50.0 no-change mark for the fourth successive month in August, posting 51.8.
Although this was down from 52.5 in July, the reading signalled ongoing improvements in business conditions in the Zambian private sector. Earlier, Stanbic head of corporate and investment banking Helen Lubamba said the PMI was Stanbic’s contribution to providing information that businesses and policy-makers could use to make informed decisions. “It gives businesses and business people the best available data to help them make better business and investment decisions. The PMI helps them know whether the business environment is improving, sluggish or declining, which can affect people’s investments,” Ms Lubamba said. The Stanbic Bank Zambia PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in about 400 private sector companies.