The Institute of Economic Affairs (IEA) has hinted that Ghana’s economy is not reaching its full potential because of several issues.
These issues include low government investment, unstable economic conditions, and high business costs.
In its latest report, the IEA suggested that for Ghana’s economy to grow faster, the country needs to make better use of its natural resources to increase investment in infrastructure and education, lower business costs, and keep the economy stable.
Recent data from the Ghana Statistical Service (GSS) showed that the economy has generally improved between the second quarter of 2023 and the second quarter of 2024, with the GDP (a measure of economic growth) increasing from 2.5% to 6.9%.
Similarly, growth in non-oil sectors rose from 3.1% to 7.0% during this period.
Looking at different sectors, agriculture saw steady growth, ranging from 4.3% to 5.4%, while the services sector also grew, with rates between 3.2% and 6.0%.
In contrast, the industrial sector had some ups and downs, shrinking in the second and third quarters of 2023 but recovering with growth rates between 1.6% and 9.3% in later quarters. The IEA linked these ups and downs to irregular oil production.
The International Monetary Fund (IMF) recently increased its growth forecast for Ghana from 3.1% to 4.0%, suggesting that Ghana’s economy is bouncing back more strongly from the impacts of Covid-19 and other recent economic challenges.