Activity in Uganda’s private sector dipped slightly in September, a survey of business managers shows. But there was encouraging news: new export orders rose for the first time in the survey’s 16-month history.
The Stanbic Bank Uganda purchasing managers’ index that surveys private sector executives on business conditions came in at 53.8, below the 54.1 reading for August. This was on output, which rose at a slower rate compared to August, and new orders, which rose at the same level as in the previous month.
Even then, September’s PMI reading indicated that business conditions improved further in the private sector. A PMI above 50 shows there is some level of increased activity, while a reading below 50 signifies a contraction. A PMI at 50 indicates that there was no change.
Output rose across all sectors save for construction, with 37% of the survey’s respondents reporting an increase. The same trend was recorded for new orders; 37% of surveyed firms said new orders had gone up, and this was observed in all sectors other than construction.
Construction output decreased, and new orders in the sector did not change from August, IHS Markit, which produces the survey, said.
“Notably, for the first time in the survey’s 16-month history, new business from abroad expanded during September,” the report said. “This was linked to entry into new markets in some of Uganda’s key trading partners amid less challenging political conditions.”
One in ten firms reported an increase in employees, while only 4% said they’d laid off staff. Overall, workforce numbers grew at a faster rate than in August, with all sectors registering a rise in staffing levels.
Output prices also rose, which was attributed to higher input costs. Industry was the only sector not to increase output prices, according to the survey.