Manufacturing sector post 7% growth in H1 2021
The manufacturing sector recorded a seven (7) percentage points growth in the first half of 2021.
This is despite the adverse impact of the Covid pandemic on the manufacturing sector.
The recorded growth rate compares favourably to the 0.7% growth rate recorded in the corresponding period in 2020 during peak of the outbreak of the Covid pandemic.
Making the disclosure during the presentation of the 2022 State of the Nation Address (SONA), President Akufo-Addo said, “Mr. Speaker, I am glad to report that despite the adverse effects of the COVID-19 Pandemic on firm-level production and productivity as well as the disruptions in global supply chains, the manufacturing subsector showed significant recovery last year. Manufacturing recorded an average growth of 7.0% in the first half of 2021 compared to 0.7% in the corresponding period in 2020 at the beginning of the pandemic.”
Underpinning the growth in the manufacturing sector was the One District One Factory (1D1F) to which the President noted that, some 106 factories are currently operational.
“Our flagship One District One Factory (1D1F) Initiative is being implemented, with business promoters being empowered and supported either to establish new factories or to transform existing manufacturing enterprises to contribute significantly to job creation across the country.
“Mr. Speaker, through the 1D1F initiative, the made-in-Ghana label is being stamped on a wide range of products proudly manufactured in Ghana. Out of a total of two hundred and seventy-eight (278) 1D1F projects at various stages of implementation in all the sixteen (16) regions, one hundred and six (106) factories are currently operational, one hundred and forty-eight (148) are under construction, while twenty-four (24) projects are at mobilization stage.
“Mr. Speaker, in order to bring the youth on board the 1D1F Programme, fifty-eight (58) out of the two hundred and seventy-eight (278) 1D1F Projects have been developed as enterprises fully owned by youth groups, with direct Government support. Each of these 1D1F Youth companies are owned by between forty (40) and fifty (50) youth as shareholders,” the President remarked.
The Industry sector for the 2022, is projected to grow by some 6.3 percentage points after posting negative growth rates of 3.6 percent and 0.5 percent in 2020 and 2021 respectively.
Read: SONA 2022: ICUMS rake in GHS 16bn in revenue for government – Prez Akufo-Addo
Industry, for the first half 2021, according to the Minister for Finance, Ken Ofori-Atta in his presentation of the 2022 budget, contracted by 1.3 percentage points.
The sector’s contraction however, compares favourably with an average contraction of 3.2 per cent over the same period in 2020.
The mining and quarrying subsector for instance, the Minister noted during the budget presentation, contracted by 11.2 per cent and 18.9 per cent in the first and second quarters of 2021.
The recorded contractions compares to contractions of 8.8 per cent and 11.6 per cent in the corresponding periods of 2020.
The services sector, within the same period, “recorded an average growth rate of 7.2 per cent, compared with 2.3 per cent in the same period of 2020”, Mr Ofori-Atta said.
“The sector recorded growth rates of 4.0 per cent and 11.0 per cent in the first and second quarters respectively, compared to 12.3 per cent and -7.7 per cent for the same period in 2020”, he told the legislature.
“Mr Speaker, the subsector with the highest growth in the services sector was information and communication (average of 21.0%), followed by health and social work (average of 14.7%), and real estate (average of 11.8%)”.
The hotel and restaurant subsector, which “contracted by an average of 23.9 per cent in the first two quarters of 2020, stemming from COVID-19-related restrictions in the period, further contracted by 5.4 per cent during the same period in 2021, reflective of an industry that is still struggling to recover from the adverse economic effects of the pandemic.”
The services sector, the Minister noted, remains dominant in terms of sectoral distribution of nominal output, although its relative share over the first half-year has shown a marginal decline.
The sector, he noted, accounted for an average share of 51.9 per cent over the first two quarters of 2021, compared with an average of 52.8 per cent over the same period in 2020.
The average share of the agriculture sector increased from 19.1 per cent in the first half of 2020 to 21.3 per cent for the same period in 2021 while the industry sector’s share decreased from 28.0 per cent in the first half of 2020 to 26.7 per cent in the corresponding period in 2021.
