Consumer spending, proxied by domestic VAT collections and retail sales, posted a mixed performance in May 2022, compared with the corresponding period in 2021.

According to data from the Bank of Ghana (BoG), domestic VAT collections increased by 30.6 percent on a year-on-year basis to GH¢700.12 million in May 2022, up from GH¢536.10 million recorded in the corresponding period in 2021.

“Cumulatively, total domestic VAT for the first five months of 2022 went up by 15.6 percent to GH¢3,153.50 million, compared with GH¢2,728.77 million for the corresponding period of last year”.
Bank of Ghana

Retail sales, on the other hand, dipped by 6.0 percent year-on-year to GH¢107.90 million in May 2022, down from GH¢114.78 million recorded in the same period in 2021.

Similarly, on a month-on-month basis, retail sales declined by 11.7 percent in May 2022 from GH¢122.20 million recorded in April this year.

“The relative moderation in retail sales largely reflected declining consumer demand during the review period. However, in cumulative terms, retail sales for the first five months of 2022 increased by 5.0 percent”.
Bank of Ghana

Moderation of real sector activity

From January to May this year, domestic economic activity slowed considerably. The latest high frequency indicators recorded broad-based moderation in key real sector indicators in May 2022, compared to a year ago.

Aside Retail sales, the Bank of Ghana disclosed that cement sales, vehicle registration, port activity and industrial consumption of electricity all contracted in the first five months of the year. Only domestic VAT collections and tourist arrivals improved in the review period.

Activity in the construction sub-sector, proxied by the volume of cement sales, declined by 25.7 percent (year-on-year) in May 2022 to 264,619.73 tonnes, down from 356,016.77 tonnes recorded a year ago.

On a month-on-month basis, total cement sales dipped by 9.1 percent in May 2022, compared with the 291,036.67 tonnes recorded in April 2022.

“Cement sales for the first five months of 2022 went down by 12.2 percent to 1,556,916.30 tonnes, from 1,773,091.21 tonnes for the same period of 2021. The decline in total cement sales was due to a slowdown in construction activities during the review period”.
Bank of Ghana

Industrial Consumption of Electricity

Consumption of electricity by industries also went down marginally by 0.6 percent on a year-on-year basis during the period under review.

Industries consumed 264.71 gigawatts of power in May 2022, as against 266.25 gigawatts recorded for the corresponding period in 2021. On a month-on-month basis, power consumed by industries in May 2022 declined by 2.4 percent, from 271.23 gigawatts utilized for April 2022.

However, in cumulative terms, electricity consumed by industries for the first five months of 2022 increased by 5.6 percent to 1,348.23 gigawatts, from 1,276.70 gigawatts for the corresponding period a year ago.

Transport sector activities, gauged by new vehicle registrations by the Driver and Vehicle Licensing Authority (DVLA), declined by 20.5 percent to 17,011 in May 2022, from 21,389 vehicles registered during the corresponding period of 2021.

Cumulatively, data from BoG showed that vehicles registered by the DVLA within the first five months of 2022 decreased by 4.1 percent to 134,402 from 140,082 recorded a year ago.

The contraction of most of the activities resulted in a moderation in GDP growth to 3.3 percent in the first quarter of 2022, compared with 3.6 percent in the same period of 2021, and 7.0 percent in the fourth quarter of 2021. Non-oil GDP growth was 3.7 percent, down from 5.3 percent recorded for the comparative period in 2021. The deceleration in growth was driven by slower activity in the agriculture and services sectors.