Economic activity in Ghana to get worse before getting better in 2023 – Fitch Solutions

International firm, Fitch Solutions, has emphasized that economic activities in Ghana will get worse before moving to a better position in 2023.

The UK-based firm explained that the relatively appreciable growth rate recorded in the first of 2023 was primarily driven by strong government consumption while revenue taxes increased significantly.

Senior Analyst for Sub-Saharan Africa, Mike Kruninger, speaking on the Mid-Year Review of Sub-Sahara Africa outlined that Ghana’s export activity remained robust in the first quarter of 2023 while imports activity dropped.

“I think it will get worse before it gets better. So, in the first quarter of this year, economic growth in Ghana surprisingly was on the upside, having expanded by 4.2% year-on-year, accelerating from the 3.7% recorded in the final quarter of last year,” Kruninger opined.

He continued, “So, this acceleration in the first quarter of 2023 was primarily driven by strong government consumption plus exports remained pretty solid, while imports altered”.

Prior to this, Fitch had projected that the country’s budget deficit will narrow substantially to about 5.7 percent of GDP in 2023, from a projected 8.3 percent recorded in 2022.

Meanwhile, the Ghana Statistical Service said in the first quarter of 2023, the economy expanded by 4.2 percent year-on-year.

MA/NOQ

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