The Purchasing Managers Index (PMI), published by BlomInvest, rose to 49.4 points in January, compared to 48.4 in December. This suggests a moderate increase in business activity, less than what was observed at the end of 2023.
Commenting on the figure, Fadi Osseiran, Managing Director of BLOM Business Bank, stated, “The Purchasing Managers Index increased from 48.4 points in December 2023 to 49.4 points in January 2024, demonstrating its resilience to challenges. These reassuring results are largely attributed to the limited impact of the conflict in Israel, confined to Lebanon’s southern border, and the stability of the Lebanese pound’s exchange rate against the US dollar.”
Osseiran emphasized that despite positive developments, Lebanon continues to face persistent challenges in its economic recovery. “This was evident after the approval of an amended budget lacking essential reforms to address the ongoing crisis in the public sector, coupled with the absence of a comprehensive plan for financial and structural reforms,” Osseiran continued.
According to the survey, business activity levels declined at the beginning of 2024, with political and economic conditions in the country cited by participating companies as a hindrance to growth.
Falling sales restrained business expansion, and PMI data for January 2024 revealed a decrease in new business in private sector companies in Lebanon.
The decline in tourism activity also contributed to the drop in new export orders, marking the fastest decline since December 2022. However, the decrease in total new orders from domestic and international customers was moderate.
Regarding the outlook, national and regional uncertainty is expected to limit growth over the next 12 months, as indicated by the weakness of the future production index. Despite the overall low level of business confidence in Lebanon in January 2024, it remained well above the average for the past four years.
The PMI is an indicator based on the monthly results of 400 companies, measuring private commercial activity. A value below 50 points indicates a decrease in activity, and a decrease compared to the previous month suggests a continued downturn.
