Bretton Wood institution, the World Bank Group (WBG), has projected GDP growth rates of 1.4 percent for Ghana this year.
The 1.4 percent growth rate reflects a rebound from the low growth rate of 0.4 percent in 2020 due to the adverse impact of Covid-19 pandemic.
According to the World Bank in its June 2021 Global Economic Prospects Report, GDP growth rate for Ghana is expected to firm up to 2.4 percent in 2022 and then to 3.6 percent in 2023 on the back of positive spillovers from strengthening global economic activity, including higher oil and metal prices, and some progress in containing the COVID-19 pandemic.
The GDP growth rate projections for Ghana by the World Bank though welcoming, stands in sharp contrast to growth projections by the International Monetary Fund (IMF) and other institutions such as Fitch Solutions and Moody’s.
The IMF in its April 2021 World Economic Outlook (WEO) Report, projected Ghana to grow at 4.8 percent this year and 6.1 percent in 2022.
GDP growth is however, projected to fall to 4.5 percent in 2023.
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Despite citing similar economic reasons for the increment in the country’s GDP growth, projected growth rates of both institutions stand in sharp contrast.
However, government through the Ministry of Finance has for this year projected a growth rate of 5 percent for the country.
The 5 per cent GDP growth according to government, will be attained on the back of the gradual pick up in economic activities which is to be further boosted by the Covid-19 vaccination exercise coupled with government’s implementation of the Ghs 100 billion Obaatanpa Ghana CARES Programme.
Meanwhile, the size of the economy in GDP terms, according to Fitch Solutions, will expand from $62.8 billion in 2020 to $83.2 billion by the end of 2023.
According to Fitch Solutions, research arm of credit rating agency, Fitch Ratings, the expansion of Ghana’s economy is expected to start this year, with the economy growing by $7.2 billion in monetary terms.
Further growing by $5 billion to reach $75.5 billion in 2022.
The more than $20.4 billion increment in the country’s Gross Domestic Product (GDP) according to Fitch Solutions in its April 2021 West Africa Fiscal Monitor Report will translate into a per capita income of $2,206 dollars from the present per capita income of $2,020 by the end of 2021, reaching $2,677 by the end of 2023.
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The expansion of the country’s economy Fitch Solutions further notes, will cement Ghana’s position as the eighth (8th) largest economy on the African Continent.
With regards to Ghana’s public debt stock, the IMF has projected Ghana’s total debt stock to hit 86.6 percent in 2025.
According to the IMF, Ghana’s debt stock is expected to continue on an elevated path reaching 81.5 percent this year, 83.2 percent in 2022, and further to 84.8 percent, 86.0 percent and 86.6 percent in 2023, 2024 and 2025 respectively.
The country’s debt stock will however, reduce by 1.1 percentage points in 2026, ending 2026 at 85.5 percent.
The country’s debt projections stated in the Fund’s April 2021 Fiscal Monitor Report, could possibly push the Ghanaian economy into the debt-distress category, given the fact that the country is already at risk of high debt distress.
