The Gross Domestic Product (GDP) for Ghana – the country’s total monetary value of goods and services produced for 2023 is projected at 2.8 per cent, with an increase to 3.9 per cent in 2024.

“On Ghana, we do expect growth to slow this year [2023] … But in 2024, we see a rebound in particular in the extractive activities and that is going to support Ghana in 2024.”

Mr Daniel Leigh, a Division Chief, Research Department at the IMF, said when he responded to a question posed by the Ghana News Agency during the January World Economic Outlook update held simultaneously in Singapore and online.

The Extractive Industries Transparency Initiative (EITI) reporting data, showed that the sector accounted for 14 per cent of Gross Domestic Product (GDP), 18 per cent of revenue in 2018, and contributed two per cent to employment.

Ghana, which is the second largest gold producer in Africa and the ninth-largest diamond producer in the world, earned $731.94 million in petroleum receipts in the first half of 2022.

However, the Washington-based lender from whom Ghana is currently seeking a US$3 billion loan-support programme for economic recovery and resilience, said the country would see a slow growth in 2023.

The IMF attributed the slow growth, partly to global headwinds, with other factors contributing to it being the Russian-Ukraine war, global energy crisis, and the tightening of global financial conditions.

It was confident that the Fund support programme would help to restore macroeconomic stability, debt sustainability, and create the foundations for higher and inclusive growth over the medium-term.

Ghana has reached Staff Level Agreement with the IMF for a $3bn three-year arrangement under the Extended Credit Facility (ECF), with the hope of securing an Executive and Board Management approval by the end of March 2023.

Mr Leigh said: “It’s a difficult time for the global economy that affects Ghana,” and quickly added that there were some domestic headwinds, particularly, inflation, which had increased significantly.

The rate of inflation touched a high of 54.1 per cent in December, spurred by food inflation, with the Bank of Ghana (BoG) increasing the Monetary Policy Rate (MPC) by a 100 basis points to 28 per cent to drive inflation downwards.

In relation to this, Mr Leigh said: “The Central Bank is tightening monetary policy, but that is cooling the economy domestically. Plus, the fiscal policies are tightening to address the elevated debt. This is the cooling in 2023.”

Ghana’s condition is not so different from Sub-Saharan Africa, which is also expected to have a “difficult year,” – much affected by the external forces that are shaping the global outlook.

Growth in the region is projected to be around 3.8 per cent in 2023, which is a bit below the typical growth rates that the region experienced before the pandemic, but would increase to 4.1 per cent in 2024.

Meanwhile, global growth is expected to slow from 3.4 per cent in 2022, to 2.9 per cent in 2023, then rebound to 3.1 per cent in 2024.

“For advanced economies, the slowdown will be more pronounced, with a decline from 2.7 per cent last year, to 1.2 per cent this year. Nine out of ten advanced economies will see growth decelerate this year,” said, Mr Pierre Olivier Gourinchas, Chief Economist and Director, Research Department, IMF.