Revenues from oil exports over the first-half of 2022 increased by 61.26 per cent year-on-year, owing to the sustained rise in oil prices as the Russia-Ukraine conflict drags on and geopolitical rifts worsen.

Analyzing data from the Bank of Ghana (BoG), crude exports rose to $2.83 billion in June 2022, from $1.76 billion in the previous year’s month. The figure for June 2022 reflected a 24.13 per cent rise from that of the previous month.

With oil prices likely to remain elevated, it is expected that the country will continue to benefit as there is still no end in sight for Russia’s invasion of Ukraine and demand for the commodity continues to rise given constrained supply. As it stands now, oil prices are still above US$100 per barrel. This supports the rise in oil exports over the last four months.

On the back of increased domestic consumption for petroleum products, oil imports increased by more than 20 per cent on a month-on-month basis, whereas non-oil imports increased to $2.29 billion from $1.75 billion in the previous month.

According to the Bank of Ghana data, total exports reached $9.0 billion in June 2022, rising more than $1.5 billion over the first half of the previous year. Cumulatively, total exports for June rose 17.8 per cent from $7.65 billion year-on-year.

Consequently, the country recorded a trade surplus of $1.44 billion in June 2022, after the surplus rose more 6 per cent in May 2022 from $1.23 million in April 2022. The trade surplus represents a 62.1 per cent rise from that of the previous year, reflecting 2.0 per cent of GDP.

Export Performance of Cocoa and Gold

Rich in cocoa and gold, which are major contributors to Ghana’s economy, the performance of these two commodities have not been as huge as that of oil; cocoa exports dropped in June 2022, for instance.

Though cocoa exports passed the $1.0 billion mark, it saw a drop from $1.79 billion in June 2021 (22.5% decline). This could be attributed to the effect of the ongoing Russia-Ukraine crisis on the country’s cocoa exports, as cocoa is one of the major imports of Russia and Ukraine from Ghana.

Of all the products exported from Ghana to Russia, cocoa and cocoa preparations ranked the highest, making up 6 per cent of the shares of Russia’s imports in 2020. In Ukraine, cocoa and cocoa preparations is the second most exported commodity from Ghana, making up 9 per cent of shares of Ukraine imports.

On the other hand, total imports rose from $1.14 billion in January 2022 to US$7.57 billion in June 2022. Out of this, oil imports rose to $5.28 billion at the end of June 2022 from $896.2 million in January 2022.

The data showed that cumulatively, gold exports rather saw an increase from $2.67 billion in June 2021 to $3.02 billion in June 2022. Nonetheless, gold maintained its place as the largest share of exports in the first four months of the year as well as the main foreign exchange earner for the country.

The rise in gold exports is due to the role that gold plays as a safe haven asset. Investors continue to increase demand for gold to hedge against the volatilities in the financial market as uncertainties rise due to the ongoing Russia-Ukraine crisis as well as inflationary pressures.