Country Economic Forecasts > Ghana

The Ghanaian economy grew just over 4% in H1 this year, but the pace will slow in H2 as the spillover effects of the authorities' fiscal consolidation drive intensifies and the ongoing power crisis continues to dampen activity. We now expect GDP growth of 3.6% this year, down from 4% in 2014. But the IMF approved the first review under Ghana's ECF programme in September, resulting in the disbursement of US$116m of funding, which should continue to support other capital inflows. And with electricity supply expected to improve in 2016 and production at the TEN oilfield scheduled to come online, which should see crude oil output rise by over 20% in 2016, activity should pick up next year. Furthermore, cocoa output is forecast to rebound due to higher domestic prices and improved supply of fertiliser and pesticides. On the other hand, austerity measures will have an adverse impact on activity. Overall, we forecast GDP growth will rise to 4.4% in 2016 and then 5.3% in 2017. On the downside, inflation still over 17% remains a worry and has brought another rise in the policy interest rate to 25%, while there are also concerns about the fiscal deficit and the current account deficit, with the latter seen falling only slowly from an expected 10% of GDP this year.