Ghana is set to emerge as the world’s fastest growing economy this year, the New York Times has said in a new report.
According to the report, research from organisations such as the World Bank, International Monetary Fund (IMF) and African Development Bank (AfDB), suggests that Ghana may be poised to potentially beat out India’s growth to become the world’s fastest growing economy for 2018.
“Projections currently suggest that Ghana’s economy will grow from between 8.3 and 8.9 per cent in 2018. In Banker Africa #46 we took a look at the macroeconomic situation of the Ghanaian economy and suggested that the country was set to get back on track following a tough year in 2016, the reality is that this estimate may have been too conservative,” the report stated.
Analysts believe that with commodity prices on the rise, and the country’s oil production rapidly expanding in conjunction with Ghana’s position as the second largest exporter of cocoa in the world, the West African nation is rapidly moving away from the historical poverty situation.
The New York Times points to the IMF’s projections that suggest only Bhutan and Libya may have a growth rate that outpaces Ghana, but that Bhutan’s economy is significantly smaller than that of Ghana’s and Libya is recently emerging from a war.
It will be recalled that, citing latest projections by all three of the international lenders focusing on the continent- World Bank, the AfDB and the IMFBloomberg had last month reported that Ghana’s growth should surpass that of recent champions of the continent, Ethiopia and Ivory Coast.
The news agency reported that the West African economy is forecast to expand the fastest on the continent in 2018.
Commodities including oil, gold and cocoa are the mainstay of the $43 billion economy and rising crude output is boosting the nation’s finances.
“Ghana has a more diversified economy than a lot of its African peers,” Capital Economics Ltd. economist John Ashbourne said .
“Ghana is doing very well — this isn’t just a matter of being the last man standing.” Ghana’s growth booms and busts have been closely linked to crude since it became an oil producer in 2010, when Tullow Plc started the Jubilee field. Economic growth surged to 14.4 percent the following year, and slumped to less than four per cent from 2014 to 2016 as oil prices dropped.
“Ghana clearly is having an oil-fueled boom at the moment but non-oil growth is yet to pick up markedly. Its high debt-servicing cost will make it challenging to lift public capital investment despite a large infrastructure deficit compared to many peers.”