Agriculture leads, services and industry sectors with 4.3% growth in H1 2021
The Agricultural sector for the first half of this year, according to the Minister for Finance, Ken Ofori-Atta, continued its robust performance recording a growth rate of 4.3 percent ahead of the Services and Industry sectors.
Presenting the 2021 Mid-year budget review in Parliament last Thursday, the Finance Minister noted that the Services and Industry sectors for the review period recorded 4.0 and 1.3 percentage points growth rates respectively.
For the same period last year, the Agriculture, Services and Industry sectors recorded growth rates of 10.2 percent, 12.3 percent, and 1.4 percent, respectively.
The main drivers of growth in the Agriculture Sector, the Minister for Finance noted, were the Livestock and the Crops sub-sectors, which expanded by 5.5 percent and 4.9 percent, respectively.
The Fishing sub-sector, however, witnessed a contraction of 3.6 percent for the period.
For the Services sector, the growth performance in the sector was spearheaded by the Information and Communication sub-sector which recorded a healthy growth rate of 22.1 percent, while the Industry sector growth was powered by the Construction and Manufacturing sub-sectors, which grew by 14.2 percent and 6.1 percent, respectively.
The recorded growth in the real sectors of the economy, Mr Ofori-Atta stated, is captured by the Composite Index of Economic Activity (CIEA) of the Central Bank which grew by 33.1 percent in the first half of the year.
“The real sector recovery is supported by recent data on Bank of Ghana’s Composite Index of Economic Activity (CIEA), which registered a strong annual growth of 33.1 percent in May 2021, compared to a contraction of 10.2 percent in the corresponding period of 2020.”
“The key drivers of economic activity during the period include a base drift effect, improvement in industrial production, domestic consumption, pick-up in import activities, steady rise in construction activities, and a rise in air-passenger arrivals,” said the Finance Minister.
BoG records 33.1% CIEA
The updated Composite Index of Economic Activity (CIEA) of the Bank of Ghana (BoG) as of the end of May 2021 recorded a 33.1 percent growth year on year.
The recorded CIEA is, however, a contraction from the 39.4 percent CIEA recorded the previous month – April 2021 – which may be attributable to rising cases of the Covid virus within the period that affected both consumer and business sentiments.
The recorded CIEA when, however, compared to that recorded at end-March 2021 – end of the first quarter – represents an increase of 6.3 percentage points.
According to the BoG, a sharp pickup in economic activities in the second quarter accounted for the growth in the CIEA compared to that of the first quarter.
The Bank, however, notes that despite the recorded growth in its CIEA, its latest confidence survey reflects mixed consumer and business sentiments.
“The latest confidence surveys by the Bank of Ghana reflected mixed sentiments. Consumer sentiments softened on the back of a variety of factors including the
implementation of the recently announced revenue measures contained in the 2021 Budget, while business sentiments remained somewhat broadly unchanged due to expectations of improvement in company growth prospects,” remarked Dr Ernest Addison.
The BoG’s CIEA measures changes in the level of economic activity.
