Despite the improvement in Nigeria’s Purchasing Managers Index (PMI) in December 2024, researchers and economic experts at the Centre for the Study of the Economies of Africa (CSEA) have charged the Federal Government to strengthen fiscal policies to complement monetary measures, and ensuring that inflation management does not hinder economic growth.
The researchers, who gave the advice in the consulting firm’s ‘Nigeria Economic Update Issue 2’ report released on Tuesday, maintained that this can be achieved by providing financial support and organizing market access programmes for small and medium-sized enterprises (SMEs).
The experts hinged their recommendations to the government on the recently published PMI survey report data by Stanbic IBTC Bank Nigeria, which reflected that private sector output in December 2024 rose to 52.7, up from 49.6 in November 2024, representing the first time in six months that the index exceeded the 50.0 threshold, and signalling an increase in private sector productivity.
According to the CSEA analysts, the December PMI value represented a 6.25% increase from November’s figure and was driven by higher consumer demand and purchasing activity during the holiday season.
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They noted that this improvement occurred despite persistent challenges such as high inflation, and irregular power supply while sectoral analysis showed that the agricultural sector grew by 13.93 points compared to manufacturing and service sectors, which declined by 2.43 and 3.46 points, respectively.
The experts pointed out that despite the improved business sentiment, inflationary pressures remained significant obstacles to sustained growth in private sector activity.
To address these issues, they charged policymakers to strengthen fiscal policies to complement monetary measures, and ensure that inflation management does not hamper the growth of the economy based on current reforms by the government.
