Ghana's exports shrink by 7.8 percent in 2020 - Bank of Ghana

Ghana’s total exports contracted by 7.8 percent year-on-year to US$14.5 billion in 2020, driven mainly by a significant decline of US$1.6 billion in crude oil export receipts on the back of low prices.

The country’s gold and cocoa export earnings on the other hand, went up by 9.1 percent and 2.1 percent respectively, due to favourable prices and production volumes.

The central bank, which made these known, said total imports went down by US$974 million to US$12.4 billion, underpinned by significant declines in both oil and non-oil imports.

Consequently, the trade balance recorded a lower surplus of US$2.0 billion (3.0 percent of GDP) in 2020, compared with US$2.3 billion (3.4 percent of GDP) in 2019.

According to the Bank of Ghana (BoG), the foregoing developments were occasioned by commodity price developments which impacted on the trade balance.

Commodity price trends traded mixed in 2020, influenced by Covid-related global market conditions. Crude oil prices declined by 22.9 percent year-on-year in December 2020; driven mainly by weak demand. Crude oil prices averaged US$50.2 per barrel, compared with US$65.2 per barrel a year ago.

In contrast, gold prices went up by 25.4 percent to an average of US$1,857.2 per fine ounce, strongly supported by accommodative monetary policy, increased uncertainty and the global economic slowdown due to the pandemic.

Cocoa prices averaged US$2,581.3 per tonne in December 2020 and up by 2.5 percent on a year-on-year basis.

Current Account

The BoG continued that the current account recorded a deficit of US$2.0 billion (3.0 percent of GDP) compared with a deficit of US$1.9 billion (2.8 percent of GDP) in 2019 due to the lower trade surplus and higher services outflows which was moderated by the strong remittance inflows of US$3.6 billion and lower net investment income outflows, notably, profits and dividends.

Also, Gross International Reserves at the end of December 2020 was US$8,624.4 million, providing cover for 4.1 months of imports of goods and services. The reserve level compares with the end-December 2019 position of US$8,418.1 million, equivalent to 4.0 months of import cover.

Cedi Performance

Cumulatively, it said the Cedi depreciated by 3.9 percent against the US dollar in 2020, compared with a depreciation of 12.9 percent in 2019. The Cedi also depreciated by 7.1 percent against the Pound and 12.1 percent against the Euro, compared with 15.7 percent and 11.2 per cent over the same comparative period.