The Economist Intelligence Unit predicts a 1.3% expansion of Ghana’s economy in 2023, below the projections by the World Bank and the International Monetary Fund. The report cites rising prices and monetary tightening as the main reasons for the slowdown.
Ghana’s economy will slow significantly in 2023, as the Economist Intelligence Unit is forecasting a 1.3% expansion of the economy. This is below the projections by the World Bank (1.8%) and the International Monetary Fund (1.6%).
According to the UK based organization, real GDP growth will slow in 2023 as rising prices and monetary tightening weigh on private consumption and investment. Subsequently, government spending would decline.
In its 2023 County Report on Ghana, it said growth will remain subdued in 2024 as tightening continues, adding, it will then pick up over 2025-27, driven by an uptick in gold and oil exports earnings as new projects come on stream”. “Growth will slow to 1.3% in 2023, as a cost-of-living squeeze, public spending cuts and monetary tightening by the BoG will cause domestic demand to contract for the first time since 2014.
Prices of petroleum products may stay same for the next two weeks despite the reduction in the prices of the finish products on the world market. According to the Institute for Energy Security, the significant drop in the value of the Ghana cedi against the US dollar in the last two weeks may thwart the expected fuel price reductions in the coming weeks.
In its projection of petroleum prices for this pricing window, the energy think tank said data from the IES Economic Desk on the domestic foreign exchange (forex) market over the last two weeks showed the Ghana cedi closed trading at GH¢12.01 to the US dollar, from GH¢11.55 at the start of the window. This led to a loss of about 3.98% in value.