Ghana has achieved a economic milestone in December 2024, recording a trade surplus of US$4.98 billion, a sharp increase from the US$2.69 billion surplus recorded during the same period in 2023.
This performance was primarily driven by the stellar performance of gold exports, which surged by 53.15% to hit US$11.64 billion. The boost in trade highlights the resilience of Ghana’s external sector, even amidst challenges in other key export sectors like cocoa and crude oil.
The rise in gold exports played a pivotal role in Ghana’s improved trade surplus. Contributing over half of the total export earnings, gold exports climbed from US$7.6 billion in 2023 to US$11.64 billion in December 2024. This growth was attributed to favorable global gold prices and increased production volumes by local mining firms.
The growing global demand for gold, fueled by economic uncertainties and geopolitical tensions, further bolstered Ghana’s revenue. Additionally, government policies aimed at curbing illegal mining and improving the efficiency of gold extraction positively impacted the sector’s performance.
Mixed Performance in Other Export Sectors
While gold led the charge, other export sectors faced setbacks. Cocoa, Ghana’s second-largest export earner, experienced a sharp decline in revenue. Cocoa export earnings fell from US$2.15 billion in 2023 to US$1.70 billion in 2024. This decline was largely due to extreme weather conditions, which disrupted crop yields, and the persistent challenge of illegal mining activities, locally known as galamsey, which continues to threaten cocoa farmlands.
Similarly, crude oil exports dropped marginally by 0.7% to US$3.68 billion in 2024, compared to US$3.71 billion in 2023. The decline was attributed to fluctuating global oil prices and reduced production levels from Ghana’s oil fields.
Despite the underperformance in cocoa and crude oil, Ghana’s total exports increased significantly by 21.06%, reaching US$20.22 billion in December 2024. This growth underscores the importance of diversifying export commodities to ensure economic resilience against external shocks.
Rising Import Bill Moderates Surplus
On the import front, Ghana’s total import bill increased to US$15.24 billion in December 2024, up from US$14.01 billion in the previous year. The rise in imports was driven by higher demand for industrial machinery, refined petroleum products, and consumer goods, reflecting increased economic activity and a recovery in domestic demand.
Although the growing import bill posed challenges, the strong export performance ensured a significant net trade surplus, reinforcing Ghana’s position as a net exporter for the year.
The strong trade surplus had a positive ripple effect on Ghana’s external sector. According to the Bank of Ghana, the country’s gross international reserves rose to US$8.98 billion by December 2024, equivalent to 4.0 months of import cover. This marks a US$1.1 billion increase from November 2024, driven by higher export receipts and reduced financial outflows.
The November 2024 Monetary Policy Committee (MPC) report highlighted that the external sector’s position improved remarkably throughout the year. This was supported by a higher current account surplus and strategic measures to manage external debt and capital outflows.
Gold’s significant contribution to Ghana’s trade surplus demonstrates its critical role in the country’s economic stability. As a hedge against economic volatility, gold provides a reliable source of revenue, helping to offset the impact of underperforming sectors such as cocoa and oil.
To sustain this growth trajectory, policymakers must continue implementing measures to enhance gold production and processing. Strengthening regulatory oversight, supporting local mining companies, and investing in value addition within the gold industry could further maximize the sector’s potential.
In the medium to long term, Ghana must invest in industrialization, promote value addition across all sectors, and address structural bottlenecks that hinder agricultural and oil production. Diversifying export revenues will not only boost economic resilience but also ensure sustainable growth in the face of global market uncertainties.
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