The African Development Bank has revised Ghana’s growth rate to 3.4% for 2024 and 4.3% for 2025. This is higher than the 2.8% it earlier predicted in February 2024.
According to the AfDB, the revised growth rate is stronger than earlier anticipated, describing the medium-term growth outlook as positive.
The expected growth rate would be led by industry and services on the supply side and private consumption and investment on the demand side.
Ghana will thus place 14th ahead of Nigeria in West Africa with the strongest Gross Domestic Product (GDP) growth.
Nonetheless, the outlook is clouded by several factors, including the impact of fiscal consolidation under the Post-Covid Programme for Economic Growth, the lingering effects of Russia’s invasion of Ukraine, limited access to finance and foreign exchange, and global macroeconomic shocks. However, AfDB said prudent macroeconomic management policies could mitigate the risks.
To fast-track structural transformation, the African Development Bank urged Ghana to enhance its competitiveness by easing infrastructure bottlenecks; accelerate agro-industrialization by strengthening skills development, among others.
“Ghana’s structural transformation needs reinforcement. Productivity has stagnated in services, the dominant employment sector, and is rising only slowly in industry and agriculture. Agriculture’s employment share declined from 53.9% in 2007 to 29.8% in 2019, while industry’s share rose from 14.1% to 21.0% and services’ share rose from 31.9% to 49.2% over the same period. To fast-track structural transformation, Ghana must enhance its competitiveness by easing infrastructure bottlenecks; accelerate agro-industrialization by strengthening skills development, value addition, and private sector development; and create a policy framework for technology adoption and innovation”.
West African growth rate to hit 4.2%
Meanwhile, growth is projected to pick up in West Africa, rising from an estimated 3.6% in 2023 to 4.2% in 2024 and consolidating at 4.4% the following year. This is an upgrade of 0.3 percentage points for 2024 over the January MEO 2024 projections, reflecting stronger growth upgrades in the region’s large economies— Côte d’Ivoire, Ghana, Nigeria, and Senegal.
Real GDP growth is projected to rise to 3.7% in 2024 and will exceed the rate posted in 2022 by 2025, reaching 4.3% as most of the effects of the aforementioned factors fade. The projected rebound in Africa’s average growth will be led by East Africa (up by 3.4 percentage points) and Southern Africa and West Africa (each rising by 0.6 percentage points).
Importantly, 40 countries will post higher growth in 2024 relative to 2023, and the number of countries with more than 5 percent growth rate will increase to 17.
