Maputo, Nov. 5, 2025 (Lusa) - Mozambique's economic activity recovered in October, with conditions in the private sector improving for the first time in three months, according to the PMI index released on Wednesday by Standard Bank, acknowledging the return of economic growth this quarter.
"Conditions in Mozambique's private sector improved for the first time in three months, supported by a further increase in new business and sharper rises in activity and employment. Purchases of production inputs also increased, but inventories declined again," the PMI (Purchasing Managers Index)study reads.
Quoted in the report, the chief economist at Standard Bank Mozambique notes that "despite increased risks to macroeconomic stability," stemming "mainly from fiscal pressure and foreign currency shortages," The October PMI indicates "positive business expectations" and "suggests that respondents remain optimistic about production growth over the next 12 months, incorporating most likely" expectations about progress on liquefied natural gas megaprojects.
"The Mozambican economy recorded negative GDP growth, year-on-year, from the last quarter of 2024 to the second quarter of 2025. We expect GDP growth to turn positive from the last quarter of this year, supported by robust favourable base effects," Fáusio Mussá writes.
The Mozambican economy recorded year-on-year contractions in Gross Domestic Product (GDP) in the last quarter of 2024 (-4.9%), the first quarter of 2025 (-3.9%) and the second quarter (-0.9%), impacted by the social unrest in the period following the general elections on 9 October, 2024.
The PMI report adds that in October, "additional growth in new business, which was also one of the sharpest in just over a year, matching the July rate," was "essential for the recovery."
"Respondents often attributed this growth to the acquisition of new customers in the context of a general strengthening of market demand. With the improvement in order books, Mozambican companies increased their production for the fourth consecutive month. The pace of growth in activity accelerated compared to September, reaching its fastest level since July," the report points out.
The October PMI also notes that increases in production and sales were driven mainly by the construction and services sectors and that the "remarkable gains" in these segments of the private sector "somewhat masked the weaker performances seen in the secondary sector, wholesale and retail trade, and agriculture."
The report also points out that employment levels rose for the fifth consecutive month and at one of the fastest rates since July 2024", as in August, and that "purchasing activity accelerated, with companies highlighting increased requirements for means of production and acquisitions related to the launch of new products".
The PMI index had risen from 49.1 in June to positive territory in July, at 50.7, but in August it fell back to a negative figure, to 49.9, and in September to 49.4, recovering in October to 50.4 points.
PMI indicators above 50 points point to an improvement in business conditions compared to the previous month, while indicators below that figure show a deterioration.
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