The Institute for Economic Affairs (IEA) has described the projected growth rates for Ghana’s economy in the next five years, as provided by the International Monetary Fund, as being below its potential.
In its bi-monthly Economic Outlook, the IEA stated that Ghana has excess resources and capacities that could enable it to grow at higher rates, which are necessary to accelerate the country’s development and poverty alleviation. It added, “What is required is to leverage these resources to increase investments in physical capital, human capital, and technology to drive economic growth.”
Despite the strong and rising growth in the third quarter of 2024, Ghana’s growth for the year was projected at just 4.0%. This suggests that growth will slow down considerably in the fourth quarter of 2024.
The IEA noted that the reason for the slowdown was not immediately known.
“It could be due to a projected decline in the value of some of Ghana’s major commodities, either from lower volumes and/or prices,” it stated.
The projected growth of 4.0% for Ghana in 2024 is slightly higher than the growth rates of 2.9% and 3.8% recorded in 2023 and 2022, respectively.
Real GDP growth is projected in the IMF programme to rise to 4.4% in 2025, 4.9% in 2026, and then plateau at 5.0% during 2027-2029.
“These growth rates are, however, below the country’s potential,” the IEA expressed concern.
Economy expanded by 7.7% in Q3 2024
Ghana’s economy expanded by 7.7% in Q3, much higher than the 2.2% recorded in the same period of 2023. Non-oil real GDP growth was a little lower at 7.2%.
The strong growth recorded in overall real GDP in Q3 2024 was fueled by extractives, largely oil and gold.
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