FITCH SOLUTIONS PROJECTS GHANA’S ECONOMY TO BE THE FASTEST-GROWING IN SUB-SAHARAN AFRICA IN 2021
Rating Agency Fitch Solutions has predicted that Ghana’s economy is expected to become the fastest growing in sub-Saharan Africa this year. The agency is projecting a 4.8% expansion in the economy, consistent with the International Monetary Fund, Moody’s and Standard Bank forecasts. The projection contrasts with the World Bank, which is forecasting a 1.4% Gross Domestic Product (GDP) growth rate.
Assessing economies in the region, Fitch Solutions said Ghana’s economy would grow strongly because of a healthy rebound in private consumption and exports. “We expect the real GDP growth rate to accelerate to 4.8% in 2021 on the back of a healthy rebound in private consumption and exports. Government spending will remain elevated in the coming quarters and support the economic rebound.”
It explained further that “consumer and business confidence are expected to remain high in the third quarter of 2021. However, it added that “social tensions will remain elevated; the protest movement #FixTheCountry may result in a rise in demonstrations. “Sporadic protests likely in the coming months, notably over government concerns, but we think this will be fairly on a small scale and unlikely to have a detrimental effect on the growth outlook.”
Senior Risk Analyst at Fitch Solutions in charge of sub-Saharan Africa, William Attwell, told Accra -based Joy News that “the outlook for Ghana is considerably more upbeat and we focus fairly robust GDP Growth rate of 4.8% which is among the highest rates for any SSA economies. And this reflects a fairly strong consumer recovery, second tranche of government stimulus spending and fairly healthy exports performance.”
“As a case in other SSA markets, Ghana experienced an initial rebound in growth, real GDP rising by a steady if not a spectacular in Q1 (quarter one) by 3.1%. But the economy has subsequently faced headwinds,” he added.
Ghanaian economy expands by 3.1% in the first quarter of 2021
Ghana’s economy grew by 3.1% in the first quarter of this year. This is the lowest since the same period in 2019. However, in the same period of 2020, the GDP growth rate was 7.0%. The Ghana Statistical Services indicated that Information and Communication (22.1%), Construction (14.2%) and Manufacturing (6.1%) sub-sectors were the main contributors of growth for the first quarter.