The International Monetary Fund (IMF) predicts that Ghana’s economy will experience a rebound in 2024, due to its extractive industries.
Despite a slow growth forecasted for 2023, the IMF says that Ghana’s Gross Domestic Product (GDP) is projected to increase from 2.8% to 3.9% in 2024, supported by the extractive sector.
According to data from the Extractive Industries Transparency Initiative (EITI), the sector accounted for 14% of the country’s GDP and 18% of revenue in 2018.
Ghana, which is the second largest gold producer in Africa and the ninth-largest diamond producer in the world, earned over $731 million in petroleum receipts in the first half of 2022.
However, the IMF warns that Ghana’s growth will slow down in 2023, with the organization attributing this partly to global headwinds such as the Russian-Ukraine war, the global energy crisis and tighter global financial conditions.
The IMF is confident that its loan-support program, which Ghana is seeking, will restore macroeconomic stability, debt sustainability and lead to higher and more inclusive growth in the medium-term.
Daniel Leigh, a division chief at the IMF’s Research Department, acknowledged that inflation has increased significantly, which has contributed to a slowing economy in 2023.
Despite this, the Bank of Ghana has tightened its monetary policy and the country’s fiscal policies are also being tightened to address the elevated debt.
Sub-Saharan Africa is also expected to have a difficult year, with growth projected to be around 3.8% in 2023. Meanwhile, global growth is expected to slow from 3.4% in 2022 to 2.9% in 2023, before rebounding to 3.1% in 2024.Nine out of ten advanced economies are expected to see a slowdown in growth this year, according to Pierre Olivier Gourinchas, chief economist and director of the IMF’s Research Department.