Ghana’s Economy Records The First Contraction In 37 Years
For the first time, in 37 years, Ghana’s economy has seen a contraction of 3.2%. Specifically, from a current prices point of view, the GDP estimates for the second quarter of 2020 was GHC85,758.1 million. This is relative to GHC84, 312.0 million for the second quarter of 2019. This increase in GDP is strictly from a current prices point of view. The influence of price changes over time is the main reason we are seeing the increase of about 1,446 million Ghana cedis.
This implies that the value of goods and services produced in the second quarter of 2020 contracted by 0.8% over the value of goods and services produced in the first quarter of 2020. On a sectoral basis, Prof Annim said the highest contraction of 79.4% was recorded in the hotels and restaurants sub-sector. The highest expansion of 74.2% was recorded in the information and communication sub-sector.
The Agriculture sector which makes up 19% of all goods produced in the second quarter, saw a growth rate of 2.5%. He added that the services sector which is 48% saw a growth rate of negative 2.6%. The industry sector which makes up 33 percent of all goods and services produced recorded a negative growth rate of 5.7%.
GDP from January to March 2020
The GSS said the economy grew by 4.9% in the first quarter of 2020. The data showed that the services sector saw the highest growth rate of 9.5%. The agriculture sector followed, growing by 2.8% and the industry sector by 1.5%. The main sub-sectors influenced the GDP growth in the first quarter of the year. They were information & communication, manufacturing, education and public administration & defense, social security.
With a looming election, Ghana’s economy grapples with a pandemic. Falling oil revenues. A nagging fiscal deficit and the imperative to diversify. Ghana needs to find new sources of growth and economic diversification to sustain the momentum.
