Ghana Economic Forecast

Ghana Economic Outlook

January 23, 2018

The economy experienced a momentous turnaround in 2017, escaping the grips of subdued growth in 2016 that was brought about by lower oil production coupled with a tight monetary policy stance dampening overall economic activity. Boosts to oil production amid the oil price rally, and recovering domestic demand aided by increased monetary accommodation against a backdrop of slowing inflation, helped propel annual GDP growth to 9.3% in Q3. PMI data for Q4 suggests that while private sector activity remained buoyant at the close of the year, it lost some ground compared to the previous two quarters, likely translating into a moderated pace of economic growth in the quarter. Despite the substantial strides made in 2017, the economy is still at high risk of debt distress with an elevated debt-to-GDP ratio, threatening long-term financial stability. Reigning in the heavy debt burden and putting it on a sustainable course will be one of the government’s top priorities for 2018.

Ghana Economic Growth

Higher oil production and tighter control of expenditures should lift revenues, while domestic demand should pick up amid moderating inflation, driving robust economic growth. Headwinds to the outlook stem from financial sustainability of state-owned energy enterprises and a high outstanding volume of non-performing loans plaguing the banking sector. FocusEconomics panelists expect GDP growth of 7.1% in 2018, which is up 0.3 percentage points from last month’s forecast, and project it to moderate to 6.1% in 2019.

Ghana Economy Data

20122013201420152016
Population (million)24.925.626.226.927.6
GDP per capita (USD)1,6311,7671,4181,3461,539
GDP (USD bn)40.745.237.236.242.4
Economic Growth (GDP, annual variation in %)9.37.34.03.83.5
Consumption (annual variation in %)-7.17.45.34.32.6
Investment (annual variation in %)50.37.52.86.6-12.0
Industrial Production (annual variation in %)11.06.60.8-0.3-1.4
Unemployment Rate-  -  -  -  -  
Fiscal Balance (% of GDP)-11.3-12.0-10.9-6.9-8.7
Public Debt (% of GDP)50.160.372.272.272.5
Money (annual variation in %)22.918.233.026.624.6
Inflation Rate (CPI, annual variation in %, eop)8.811.817.017.715.4
Inflation Rate (CPI, annual variation in %)9.28.315.517.217.5
Policy Interest Rate (%)15.0016.0021.0026.0025.50
Exchange Rate (vs USD)1.902.373.193.814.30
Exchange Rate (vs USD, aop)1.852.073.053.783.94
Current Account (% of GDP)-12.1-12.6-9.9-7.8-6.7
Current Account Balance (USD bn)-4.9-5.7-3.7-2.8-2.8
Trade Balance (USD billion)-4.4-3.8-1.3-3.2-1.8
Exports (USD billion)13.513.813.210.311.1
Imports (USD billion)17.817.614.513.512.9
Exports (annual variation in %)5.32.1-4.3-21.67.9
Imports (annual variation in %)11.6-1.2-17.7-7.5-4.4
International Reserves (USD)5.35.65.55.96.2
External Debt (% of GDP)31.636.849.457.1-  

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Ghana Facts

ValueChangeDate
Exchange Rate4.460.0 %Feb 19
Stock Market0.20.0 %Feb 19

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