The index measuring business activity in Mozambique (PMI Index) improved slightly in May, from 37.1 to 40 points, but remained in negative territory due to the “serious impact” of the Covid-19 pandemic on the Mozambican economy. [You may read the full report HERE]
“The extension of quarantine measures to curb the spread of coronavirus disease 2019 (COVID-19) had another severe impact on Mozambique’s private sector economy in May,” reads the note from Standard Bank’s economic department announcing the results of the business survey used to calculate the value of business activity in the country.
“Latest PMI survey data showed further sharp declines in output and new business levels, leading to a near-record drop in employment,” the statement sent to Lusa adds.
The headline figure is the Purchasing Managers’ Index reading, which above 50 signals an improvement in business conditions, while below 50 shows a deterioration.
“The headline PMI was at 40.0 in May, up from 37.1 in April, but still indicating a substantial deterioration in business conditions across the private sector economy. In fact, the latest reading was the second-lowest in survey history (since April 2015),” the Standard Bank report reveals.
“This was primarily driven by sharp contractions in output and new orders at Mozambican businesses, of which several temporarily closed due to nationwide lockdown restrictions to stop the Covid-19 pandemic. Firms that remained open saw a dramatic fall in client demand, albeit one slightly softer than April’s unprecedented decline.”
Source: Lusa via Club of Mozambique