With strong price pressures and weak private sector sentiment, Fitch Solutions believes that economic activity will have slowed further in Q422. The firm also expects economic activity to slow further in 2023, due to tighter fiscal and monetary conditions and strong price pressures weakening domestic demand.
Fitch Solutions has forecasted that Ghana’s real GDP growth will slow to 2.9% in 2023, from an estimated 3.3% in 2022. According to data released by the Ghana Statistical Service, real GDP growth weakened significantly in Q322 to 2.9% y-o-y, from 4.7% in Q222. The mining sector recorded robust growth of 14.9%, while the manufacturing sector and the construction industry both contracted, weighing on overall economic activity.
The country’s trade balance is also expected to improve in the coming years. With subdued private sector activity amid still-high inflation and rising taxes, import demand is likely to decrease, lowering the country’s trade deficit. This will be further supported by the increase in exports, which will add 2.1 percentage points (pp) to headline economic growth in 2023, up from 1.7 pp in 2022.
