The African Development Bank predicts a bright economic prognosis for Ghana this year, with a predicted growth rate of 5.3 per cent.
However, the Bank’s 2022 Economic Outlook Report, which was presented at the Bank’s ongoing Annual Meeting in Accra, predicts a small slowdown in the economy’s growth rate.
The expected growth rate for 2022 is 5.3 per cent, which is lower than the government’s aim of 5.8 per cent stated in the 2022 budget.
However, the economy’s growth in 2022 will be stronger than the 3.7 per cent average for Sub-Saharan Africa.
The 2022 African Economic Outlook is being released against the backdrop of two significant worldwide crises: the COVID-19 epidemic and the Russia–Ukraine conflict. The latter erupted just as Africa’s economy was beginning to recover from the pandemic’s devastation, and it now threatens to derail the continent’s bright economic prospects.
Ghana’s predicted GDP growth of 5.3 per cent for 2022, according to the African Development Bank’s report, is ascribed to the Ghana COVID-19 Alleviation and Revitalization of Enterprises Support Program.
“The outlook remains positive, with projected GDP growth of 5.3% and 5.1% in 2022 and 2023 supported by the Ghana COVID-19 Alleviation and Revitalization of Enterprises Support Programme. Potential inflationary pressure exists due to increased energy and food prices associated with the impact of the Russia–Ukraine,” the report noted.
However, it expressed concern about potential inflationary pressures due to increased energy and food prices associated with the impact of the Russia–Ukraine unrest.
“Inflation is likely to rise to 15% in 2022 before declining to 9.1% in 2023, and the Central Bank is expected to adopt a tight monetary policy stance,” the report said.
Furthermore, revenue-enhancing changes are expected to drive the fiscal deficit down to 12.8 per cent of GDP in 2022 and 10.3 per cent in 2023. With higher exports, the current account deficit is expected to decrease to 1.6 per cent of GDP in 2022 and 3.3 per cent in 2023.
Climate change, challenges, and policy choices, according to the African Development Bank, pose considerable dangers to agriculture and energy, as well as climate-induced migration, due to irregular rainfall, rising temperatures, drought, floods, a rising sea level, and tidal waves.