Business confidence in Mozambique has seen continued growth for the fourth consecutive quarter, buoyed by increased demand and employment expectations, according to the latest data from the National Statistics Institute (INE).
The Business Economic Climate Indicator (ICEE), which compiles the opinions of economic agents including company managers, highlighted a slight recovery in the business economic climate in the second quarter of this year. This improvement was attributed to a modest rise in both demand and employment expectations.
The ICEE, which reached a low of 82 points in the fourth quarter of 2021, has now climbed to approximately 100 points in the second quarter of this year. This steady increase marks a significant turnaround in business sentiment.
“The favourable assessment of the economic climate, in the quarter under analysis, was due, by sector, to the favourable assessment of the indicator in all sectors targeted by the survey, with greater emphasis on the economic sector of commerce, which increased substantially compared to the previous quarter,” the ICEE report stated.
The report also noted that the demand expectation indicator has been on an upward trajectory for four consecutive quarters, reaching its highest level since the first quarter of 2020. This was largely driven by increased demand forecasts in the industrial production and commerce sectors, offsetting a decline in the services sector.
Employment expectations showed signs of recovery in the second quarter after experiencing a slight drop in the previous quarter. However, the employment balance remained below the average of the past three months. This recovery was primarily due to positive assessments in the services and commerce sectors, despite a downturn in the industrial production sector.
Conversely, the price expectation indicator saw a slight decrease compared to the first quarter of the year. This decline was mainly influenced by significant drops in the services and commerce sectors, despite a rise in the industrial production sector.
The ICEE provides insights into the current evolution of business activity and short-term expectations, focusing on aspects such as employment, demand, orders, prices, production, sales, and activity limitations.
