Ghana economic growth improves in Q4 but slows to 2.9% in 2023
TLDR
- Ghana's economy grows by 3.8% in Q4 2023, exceeding IMF estimate and marking a 2.9% full-year growth.
- Services and agriculture sectors drive growth, while the industry sector sees a slight contraction.
- Ghana shows signs of recovery amidst worst economic crisis, emphasizing efforts for sustainable growth.
Ghana's economy showed signs of recovery as it grew by 3.8% year-on-year in the fourth quarter of 2023, according to data released by the statistics agency on Wednesday. This brought the full-year growth for 2023 to 2.9%. The country has been grappling with its worst economic crisis in a generation, primarily attributed to spiraling public debt.
The annual growth rate of 2.9% exceeded the International Monetary Fund's (IMF) January estimate of 2.3%, although it marked a slowdown compared to the 3.8% growth recorded in 2022.
The growth was predominantly driven by the services and agriculture sectors, while the industry sector experienced a slight contraction. These figures reflect ongoing efforts to navigate economic challenges and foster sustainable growth in Ghana.
Key Takeaways
After grappling with defaulting on much of its overseas debt in 2022, Ghana's government took significant steps to address its financial challenges. Last year, it secured a $3 billion loan program with the IMF, followed by a deal in January to restructure $5.4 billion of loans with its official creditors. Currently, it is actively pursuing negotiations with holders of approximately $13 billion in international bonds. Despite challenges in Ghana's cocoa sector, the world's second-largest, overall economic growth has not yet been significantly impacted. The cocoa output for the 2023/24 season is projected to fall nearly 40% below target due to various factors including adverse weather conditions, smuggling, and disease. Growth in the cocoa sub-sector contracted by 1.1% in the last quarter of 2023, reflecting the sector's struggles amid broader recovery efforts in the economy.
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