Nigerian business activities grew for the first time in six months during December 2024, driven by festive demand and renewed expansions in output, employment, and purchasing. The Stanbic IBTC Bank Nigeria Purchasing Manager Index (PMI) rose to 52.7 in December from 49.6 in November, marking the most significant improvement in private sector health since January 2024.
This growth ended months of contraction as new orders surged for the second consecutive month, reflecting stronger consumer demand. Businesses responded by increasing output, hiring more workers, and ramping up purchasing activities, leading to the first stockpile of inputs in five months. Growth was recorded across sectors, including agriculture, manufacturing, and services.
However, inflationary pressures remained a challenge. Rising input costs, exacerbated by naira weakness and higher transportation expenses, drove up both purchase and output prices, particularly in the manufacturing sector. While some firms expanded employment to meet higher demand, others struggled with wage costs, leading to a mixed impact on the labor market.
Commenting on the report, Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank, linked the December rebound to festive season spending and improved customer numbers. He projected Nigeria’s economy to grow by 3.24% in the fourth quarter of 2024, revising the annual growth estimate to 3.2%.
Despite the improvement, business confidence remained subdued, influenced by persistent economic uncertainties. However, firms expressed optimism about improved access to funding and a more favorable economic outlook in 2025, signaling hope for sustained recovery.
