Ghana: Economic and Political Overview

Economic Indicators

Ghana was consistently placed among Africa’s ten fastest-growing economies before the economic recession induced by falling oil prices and the COVID-19 pandemic (6.8% annually from 2008 to 2019). In 2022, Ghana's economy faced a severe macroeconomic crisis due to existing imbalances and external shocks. However, the economy regained traction in 2023 (+2.9%) when the authorities signed an IMF Extended Credit Facility worth approximately USD 3 billion. Growth estimates for 2024 were revised upwards to 4%, reflecting a strong first-half performance despite a tight fiscal and monetary policy environment, elevated interest rates dampening private consumption and investment, and drought conditions affecting agricultural production. Over the medium term, growth is expected to strengthen as stabilization solidifies and reforms take effect. By 2026, growth is forecast to accelerate to around 5%, driven by stronger performance in non-extractive sectors, particularly agriculture and services, as well as favourable conditions in extractive industries, including small-scale gold mining and new oil reserves (World Bank).

Ghana has made significant progress towards economic stabilization, addressing severe macroeconomic imbalances that peaked in 2022. The country saw a surge in public debt due to fiscal responses to external shocks and loss of access to international financial markets, leading to debt distress, declining reserves, and rising inflation. In response, Ghana implemented major macroeconomic policy adjustments, including comprehensive debt restructuring and fiscal consolidation. The fiscal deficit for 2024 was revised down to 4.2% of GDP, reflecting nominal GDP adjustments and strong consolidation efforts. Over the medium term, the government plans to broaden the tax base and improve compliance by enhancing the regulatory framework and digitalizing service delivery. Amendments to the Fiscal Responsibility Act and the establishment of a Fiscal Council are expected to further strengthen fiscal discipline. Meanwhile, the debt-to-GDP ratio decreased marginally to 82.5% in 2024 (from 82.9% one year earlier) and is expected to follow a downward trend, reaching 76.1% by 2026 (IMF). Tight monetary policy and stable exchange rates helped reduce high inflation in 2023, from a peak of 54.1% in December 2022 to 23.2% by December 2023. However, disinflation slowed in 2024, with inflation estimated at 23.8%.

Ghanaian households have faced challenges due to high inflation and a decelerating economy. Projections by the World Bank indicate that poverty rates are expected to rise until 2026, peaking at 31.5% in 2025—levels last seen in the late 2000s—before decreasing to 30.6%. At the low-middle income line, rates may reach 55.1% by 2026. This trend reflects limited growth in services and agriculture, sectors that employ many poor and vulnerable households, as well as rising prices outpacing income growth for the poorest. According to the same source, the unemployment rate in the country was around 3.1% in 2023 (latest data available).

Main Sectors of Industry

Ghana, Africa’s largest gold producer, is rich in natural resources and benefits from fertile soil. Agriculture represents 21.1% of GDP and employs 35.4% of the country’s workforce (World Bank, latest data available). Arable lands cover approximately 57% of the country's total land area (FAO). Most of the cultivated lands (95%) consist of small and medium-sized farms (up to 10 hectares). Crops vary considerably depending on the region. In the forest zone (southwest), tree crops, including cocoa, oil palm, coffee, and rubber, are common. Maize, legumes, cocoyam or yam, with tobacco and cotton, are among the most harvested crops in the middle belt of the country. Tobacco and cotton are also harvested in the north of the country, in addition to sorghum, millet, cowpeas, and groundnuts. Ghana does not produce wheat, having to import it from overseas. While livestock production is important, particularly in the north, Ghana still imports meat and dairy products to meet demand.

Industry accounts for 29.5% of GDP and employs 17.79% of the workforce. The sector is dominated by mining, lumbering, light manufacturing, aluminium smelting, food processing, cement production, small commercial shipbuilding, and petroleum. Gold, bauxite, and manganese mining play a key role thanks to the country's rich subsoil resources. Rich bauxite reserves coupled with high hydro stocks provide strong potential for aluminium smelting. Ghana also has a relatively sophisticated automotive industry and exports cars to other parts of Africa. Moreover, the food processing industry, dominated by medium-scale enterprises, also plays a major role; while textile manufacturing includes ginneries and mills producing batik, wax cloth, fancy prints, and Kente cloth, with firms serving local and regional markets. The sector has shown strong growth in recent years. Overall, the manufacturing sector as a whole is estimated to account for 11% of GDP.

The service sector is the largest component of the economy comprising 42.5% of GDP and employing 46.9% of the workforce. The banking sector has developed and modernized in recent years but has more room to grow. In the past, the banking sector in Ghana was largely controlled by state-owned institutions and lacked significant competition. However, over the last decade, there has been a shift as certain state-owned banks underwent privatization through the government's Divestiture Implementation Program. Telecommunications is the main service sector due to rapid growth in mobile phone users and the emergence of mobile payment technologies. Ghana's digital, financial services, construction, education, and franchising industries are experiencing rapid growth (U.S. Trade Administration). According to data from the Ministry of Tourism, in the first half of 2024, the country recorded around 600,000 foreign visitors (+20% y-o-y), with tourism revenue estimated at USD 1.8 billion.

 

Breakdown of Economic Activity By Sector	Agriculture	Industry	Services
Employment By Sector (in % of Total Employment)	35.4	17.7	46.9
Value Added (in % of GDP)	21.1	29.5	42.5
Value Added (Annual % Change)	4.5	-1.2	5.5

Source: World Bank - Latest available data.

 

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Monetary Indicators	2016	2017	2018	2019	2020
Ghanaian Cedi (GHS) - Average Annual Exchange Rate For 1 MUR	0.11	0.13	0.14	0.15	0.14

Source: World Bank - Latest available data.

 

 

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Indicator of Economic Freedom

Definition

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:

59,2/100

World Rank:

101

Regional Rank:

11

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 

 

Foreign Trade in Figures

Ghana maintains a highly open stance towards foreign trade, with trade accounting for approximately 69% of its GDP, according to the latest data from the World Bank. The government's objective is to foster an economic environment conducive to private sector development, transparent trade practices, and enhanced competitiveness in foreign markets. In terms of exports, Ghana's main commodities include gold (45.4%), petroleum oils (23.6%), cocoa beans (6.6%), cocoa paste (2.4%), and manganese ores (1.9%). On the other hand, the country's primary imports consist of petroleum oils (30.0%), motor cars (3.4%), goods transport vehicles (2.4%), insecticides & herbicides (2.1%), cement (2.1% - data Comtrade for 2023).

As a member of the World Trade Organization (WTO) and the Economic Community of West African States (ECOWAS), Ghana has engaged in various partnership agreements, including with the European Union. The EU supports Ghana's "Beyond Aid" program, aimed at restructuring trade dynamics between Ghana and developed economies. Customs duties, while not excessively high, are applied to all imported products, following the common external customs tariffs of the ECOWAS. Ghana's top export destinations in 2023 were Switzerland (18.2%), South Africa (11.7%), the United Arab Emirates (10.2%), China (8.2%), and India (7.0%); with imports coming chiefly from China (18.7%), the Netherlands (9.6%), India (6.4%), the United States (6.1%), and Belgium (4.6% - Comtrade).

Data from the WTO indicates that, in 2023, Ghana exported goods worth USD 15.8 billion and imported USD 13.7 billion, marking decreases of 9.3% and 6.2% year-on-year, respectively. However, while Ghana maintains a trade surplus in goods, it is a net importer of services. In 2022 (latest data available), service exports totalled USD 8.6 billion compared to service imports amounting to USD 10.1 billion. In 2024, Ghana recorded a trade surplus of GHS 44.7 billion, with exports reaching GHS 294.9 billion, surpassing imports of GHS 250.2 billion, according to preliminary data from the Ghana Statistical Service (GSS).

Sources of General Economic Information

Ministries

Ministry of Finance
Ministry of Trade and Industry
Ministry of Energy

Statistical Office

Ghana Statistical Service

Central Bank

Bank of Ghana

Stock Exchange

Ghana Stock Exchange

Search Engines

Ghana Web
Google Ghana

Economic Portals

Ghana Trade

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