An accounting and auditing firm, Deloitte Ghana has hinted that the economy expanded by 8.9% in the second quarter of this year. This is prior to the release of the second quarter GDP figures by the Ghana Statistical Service (GSS).
According to Deloitte, its projection is driven mainly by an expansion in the agriculture sector. This signals that government’s policy interventions are yielding some results.
“The estimated Gross Domestic Product for 2021 is about ¢433 billion. This represents a growth of 8.9% compared to GDP as of the same period 2020. The key driver of the growth was the Agriculture sector which grew by about 18%, largely on account of growth in the Crop subsector. We believe that some of the programs and activities introduced by government are beginning to yield results, particularly those that support the Crop sub sector” .
Partner in charge of Financial Advisory at Deloitte Ghana, Yaw Lartey
The Financial Advisor indicated that the Hotels and Restaurants sub-sector has picked up significantly following the contraction witnessed last year.
“Also, we saw a significant growth in the Services sector, particularly in the Hotels and Restaurants sub sector. As we noticed, the COVID-19 adversely impacted on this sector, but we see some recovering in the economy – we see some activities going on in the Hotels and Restaurant sub sector. That contraction we witnessed last year of about 44% contraction, we’ve see a growth this year and that is driving the Services sector to grow at about 9%.
“The economy witnessed pick-up in economic activity in the second quarter of this year, compared with the same period of last year in which there was virtually non-existent in demand and supply due to the partial lockdown and restrictions”.
Yaw Lartey
Expected increase in exports
Deloitte expects increase in international trade, following the easing of restrictions in most economies, to drive demand for commodities. This will be favorable for commodity exporting countries like Ghana.
“This, coupled with the general increase in economic activity in 2021 is expected to help achieve the targeted growth. However, a critical success factor is how well we handle the rising COVID-19 cases. A strict enforcement of COVID protocols as well as an effective roll out of COVID vaccination will sustain the economic recovery process”.
Yaw Lartey
Deloitte expects initiatives such as the Ghana CARES ‘’Obaatan Pa’’ programme to aid the recovery of the economy. According to Deloitte, this program will increase the business and consumer activities. The accounting and auditing firm said the general increase in economic activity this year will help achieve the targeted growth. However, it cautions the country to be mindful of the third wave of Covid-19.
Growth projections for 2021
The government has recently revised its growth forecast for 2021 to 5.1% from 5% in March this year. All the major international institutions including the IMF and the World Bank, have projected strong rebound for Ghana this year.
Output expanded 0.4 percent in 2020 due to COVID-19 . However, the economy begun 2021 on a good note recording a 3.1% growth in the first quarter of this year. Expectations are however, high as economic data from the Bank of Ghana’s surveys show a strong Q2 rebound in line with expectations from Fitch Solutions.
READ ALSO: Gov’t revises 2021 growth forecast to 5.1%
