According to the IMF, the Ghanaian economy looks set to grow at an impressive rate for the short term future with Real GDP increasing at an average rate of 7.6% from 2008-2013 and inflation being halved over the same period. The current account is also predicted to fall, mainly as a result of the discovery of oil in 2007, 50km off the coast. Sound macro-economic management along with high prices for gold and cocoa helped sustain GDP growth in 2008-11.
Ghana’s economy has been strengthened by a quarter century of relatively sound management, a competitive business environment, and sustained reductions in poverty levels. Ghana is well endowed with natural resources and agriculture accounts for roughly one-quarter of GDP and employs more than half of the workforce, mainly small landholders. The services sector accounts for 50% of GDP. Gold and cocoa production and individual remittances are major sources of foreign exchange.
It is expected that the predicted $1bn annual revenue from oil reserves, which are estimated to total at least 2 billion barrels, will boost Ghana’s economy, but experience in the region shows that oil reserves do not always bring what they promise.
The table below shows average GDP growth in Ghana from 2008-2013 (forecast) as 8.3%.
|Ghana - IMF Statistics and Forecasts (2011)||All figures correspond to a percentage change from previous year|
|2008||2009||2010||2011||2012 (f)||2013 (f)|
|Real GDP per capita||5.7||1.4||5.0||10.8||5.8||4.8|
|CPI annual average||16.5||19.3||10.7||8.7||9.1||7.8|
Historically, from 2009 until 2012, the USDGHS averaged 1.5500 reaching an all-time high of 1.9700 in August of 2012 and a record low of 1.3900 in May of 2010. The USDGHS spot exchange rate specifies how much one currency, the USD, is currently worth in terms of the other, the GHS. While the USDGHS spot exchange rate is quoted and exchanged in the same day, the USDGHS forward rate is quoted today but for delivery and payment on a specific future date.
Ghana has a long history of high rates of inflation. For decades, the country recorded double-digit inflation rates and in some cases even triple-digit rates. During the past decade, however, inflation has been significantly reduced. The success in bringing inflation down is due to a combination of factors. Ghana has benefited from low imported inflation as global inflation has generally abated. Fiscally-driven demand pressures have declined in Ghana as budget deficits and associated financing have generally declined. The production and supply of food in particular, which is a major component of the CPI basket, have improved. Meanwhile, the exchange rate has been stable for longer periods than previously, reducing its impact on inflation. And finally, fuel and utility prices have been subjected to some degree of control, preventing their full pass-through to general prices
The inflation rate in Ghana was recorded at 9.50 % in July of 2012. Historically, from 1998 until 2012, Ghana Inflation Rate averaged 17.87 % reaching an all-time high of 63% in March of 2001 and a record low of 0.40% in May of 1999.