LUSAKA (The Business Telegraph): – Zambia’s private sector activity marginally rose to 46.6 for September compared to 43.4 levels in the previous months weighed by rising input inflation and delays in supply delivery as out travel restrictions continue to weigh. The Kwacha has been on a losing streak and trading at all time highs since the currency was rebased in 2012 resulting in higher input prices that accelerated selling prices. Additionally, out travel restrictions continue to affect supply chains resulting in delays in delivery times.
This is the eighteenth time in a row that the copper producer is headlining PMI in contraction with the last time Zambia recording positive being February 2019. The Zambia Statistics Agency reported a 2.1% recession for 2Q20 from 0.3% expansion in 1Q20 as disease pandemic effects intensified. The 2021 budget provided reprieve to the manufacturing sector through tax adjustments to stimulate a rebound in economy activity next year. Other persistent themes evident in Zambia’s private sector pulse include energy bottlenecks, high fuel prices and weak purchasing power.
ZAMBIAS PEER PERFORMANCE
Ghana remains above 50.0 at 51.2 as new orders rise while Kenya headlined a strong 56.3 (from 53.0) as government easing of lockdown is resulting in increased production. Uganda’s business fabric remains solid at 54.5 (from 54.6). Despite South Africa in contraction at 49.4 (from 45.3) private sector pulse is steadily rebounding for Africa’s most industrialised economy.
The Kwacha Arbitrageur
