Ghana Economy Expands 3.9% in Second Quarter on Services Growth

Gross domestic product expanded 3.9% from a year earlier, compared with 3.1% in the three months through March, Government Statistician Samuel Kobina Annim told reporters Wednesday in the capital, Accra. The economy grew 0.9% from the previous quarter.

Growth was “driven mainly by the services sector, which accounted for 50% of the growth rate,” Annim said. “Hotels and restaurants rebounded after lockdown restrictions were eased,” leading to an 18.7% expansion of the hospitality sector. That compares with a 10.7% contraction of the sector in the previous quarter.

West Africa’s second-largest economy is slowly recovering from last year’s virus-related movement curbs and a drop in oil prices that caused Ghana’s first recession since at least 2007. The slow pace of the rebound means the central bank is likely to leave rates unchanged when it meets later this month, even as it contends with inflation that’s near the top end of its target range.

Africa’s biggest gold producer has projected GDP growth of 5% for this year, helped by higher metal prices and the rollout of vaccines to contain the spread of Covid-19.

“The data show that Ghana is experiencing ongoing recoveries but the fact that we grew below 4% means there is significant downside risk if we don’t quicken the pace of vaccination,” Courage Martey, an economist at Accra-based Databank Group, said by phone after the release. 

Ghana’s services sector expanded 11% from 4% in the three months through March. The agricultural sector grew 5.5%, compared with 4.3% in the previous quarter. Oil and gas shrank 10.8% after contracting 16.2% in the first quarter. 

Source: Bloomberg Business News