Ghana’s economy, as disclosed by the 2023 Global Economic Prospect report, is set to experience a rebound in economic growth, with a projected expansion of 4.8% in 2025.
This positive outlook follows an expected GDP growth rate of 2.9% in 2024, indicating the country’s resilience and potential for long-term improvement.
The road to recovery, however, has not been without difficulties, as indicated by the 1.6% GDP growth rate forecast for 2023, a substantial decrease from the 3.2% recorded in 2022.
The 2023 Global Economic Prospect report conveyed information on the factors contributing to the reduction in Ghana’s GDP growth for the year.
According to the report, adverse economic shocks, high and persistent inflation, tightening global financial conditions, and domestic policy tightening all played a role in dampening economic activity.
The report further noted that increased foreign economic headwinds exacerbated the challenges faced by the Ghanaian economy.
On a broader regional scale, the Global Economic Prospects report highlighted the declining GDP growth in Sub-Saharan Africa (SSA). The region is expected to experience a further decline to 3.2% in 2023 before a modest pickup to 3.9% in 2024. This challenging outlook extended beyond the major regional economies, as various countries face their own set of obstacles.
South Africa, for instance, is projected to witness a slowdown in growth to a mere 0.3% in the current year, primarily due to widespread power outages that have severely impacted economic activity and contributed to the persistence of inflation. Similarly, Nigeria’s growth rate is expected to remain barely above population growth, posing challenges in mitigating extreme poverty.
More so, the report noted that the downgrades in economic outlook extend beyond growth rates, encompassing factors such as the elevated cost of living, which has restrained private consumption, and tighter policies that impede investment in many countries.
These issues, as pointed out by the report, collectively contribute to a subdued recovery and impede the region’s progress. Weakening domestic vulnerabilities, coupled with tight global financial conditions and weak global growth, further complicate the economic landscape in SSA.
Ghana’s Anticipated Growth Expected To Accelerate The Country’s Development Agenda
Meanwhile, according to the report, as Ghana aims to navigate these challenging regional dynamics, the projected rebound in economic growth presents an opportunity to propel the country’s development agenda forward.
Policy measures that address inflationary pressures, enhance domestic resilience, and attract investment will be crucial in supporting Ghana’s economic recovery.
Furthermore, collaboration with international partners and the implementation of robust reforms will be essential in driving sustained growth and creating a conducive environment for poverty reduction efforts.
While Ghana’s economy is poised for a rebound in the coming years, the country faces challenges within the broader context of declining GDP growth rates in SSA.
Adverse economic shocks, inflation, and tightening global financial conditions have weighed on Ghana’s economic performance. The regional outlook reflects a complex landscape, with various countries struggling to achieve significant growth and reduce poverty.