Business News of 2014-07-02

GDP growth slows in Q1 of 2014

The country’s real Gross Domestic Product (GDP) for the first quarter of the year has slowed down as compared to the same period last year.

According to provisional estimates released by the Ghana Statistical Service (GSS), the national data compilation body, real GDP for the first quarter of 2014, grew by only 6.7 per cent (year-on-year) as compared with the 9.0 per cent recorded during the same period of 2013.

The Deputy Government statistician, Mr Baah Wadieh, who announced this when he addressed a news conference in Accra on June 25, said “the GDP estimates at current prices, not including oil for the 1st quarter of 2014 was GH¢23.03 million compared to GH¢23.96 million in the 4th quarter of 2013. He said the nominal GDP at current prices was GH¢25.7 million in the first quarter of 2014.

Sectorial breakdown

The agricultural sector recorded the highest growth of 12.7 per cent, followed by the services sector which recorded a growth rate of 4.6 per cent. According to him, key findings of the performance of activities in the 1st quarter of 2014 compared with the 1st quarter of 2013 by economic activities showed that livestock production expanded by 24.7 per cent; fishing activities increased by 20.0 per cent; financial and insurance activities increased by 19.7 per cent; community, Social & personal activities was up by 10.7 per cent and information and communication increased by 10.3 per cent.

Industry recorded a negative growth rate of -1.1 per cent and although it was mentioned, that was to be expected in view of the serious challenges that the sector was confronted with.

Industry lacks basic amenities such as reliable electricity supply, water and also access to funds for expansion remains a bane, forcing many players in the sector to produce either below capacity or is forced to shut down.

Economic developments in Q1

In the agricultural sector, economic activity in the crops and cocoa sub-sector reflected a positive growth of 0.8 per cent over that of the 4th quarter of 2013, which was attributed to the seasonal nature of produce in the sector.

In the Industry sector, the Mining and Quarrying sub-sector recorded a growth of 8.4 per cent over that of the 4th quarter of 2013, even though gold declined by 21.7per cent during the period.

Again, in the industry sector, the manufacturing sub-sector recorded a negative growth of 0.1 per cent over the output in the fourth quarter of 2013, partly due to a lower production of food and beverages, rubber and plastic products, and manufacture of non-metallic products.

“Negative growth was recorded in the production of electricity (-1.8 per cent), water and sewerage (-3.1 per cent) and construction (-2.0 per cent),” Mr Wadieh explained. In the services sector, the public administrations sub-sector recorded a negative growth of (-7.3 per cent), with growth in financial and insurance activities sub-sector declining by (-3.9 per cent).

Structure of economy

The sectoral contribution in the first quarter of 2014 showed that agriculture contributed 14.9 per cent; industry had 33.9 per cent with the services sector maintaining its lead position with 51.2 per cent.

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