A recent report by Ghana Statistical Services revealed that Ghana’s economy grew 4.8% in the second quarter of 2022. An increase from the 3.4% recorded in the first quarter of 2022.
Ghana’s finance ministry’s initial growth forecast was 5.7%, but some economic woes forced the ministry to lower its expectations to 3.7%. This adjustment was removed as the final figures showed economic growth was closer to 5.7% than 3.7%.
This welcome growth in the economy was fueled by numerous sectors that contributed some share to the overall economy. These industries include Manufacturing (8.8%), Plants and Cocoa (4.5%), Mining and Quarrying (4.4%), Information and Communications (12.4%), and the Education (13.2%) subsectors ).
Despite these figures, it is interesting to note that growth in the agricultural sector slowed to 4.6% from 5.1% and growth in the service sector increased to 5.6% from 5.2%.
But perhaps the most interesting part of Ghana’s overall economic growth is the fact that the country is currently experiencing its worst inflation in 21 years. Last month, the country’s inflation spiked to 39.9% for the first time in two decades.
In July, the country’s inflation rate was 31.7%, so this development was expected to affect interest rates and the rate at which the government borrows internally through the issuance of Treasury bills (T-bills).
Inflation for imported items overshadowed inflation for locally produced items, particularly in the agricultural sector. Housing, transportation, groceries, gasoline, sports, water and groceries were some of the main drivers of inflation.
Even the Ghanaian cedi is reported to have fallen an alarming 64.45% year-to-date against the US dollar. This prompted the Ghanaian government to apply to the International Monetary Fund for a $3 billion economic aid program in July.
Despite its recent economic woes, Ghana’s Treasury Ministry report shows that Ghana is very adept at managing its economic crises and managing its resources.
Ghana is the second largest economy in West Africa, second only to Nigeria, Africa’s largest economy.
