Gov’t misses GDP target

Adnan A. Mohammed

Provisional real Gross Domestic Product (GDP) estimates for 2012 showed a growth of 7.1 per cent falling short of targeted 9.4 per cent growth as captured in the 2012 Budget and Economic Policy of the government for the year, according to Ebo Duncan, Deputy Government Statistician.

The Ghana Statistical Service (GSS) announcing this at a press conference last week explained that, the short in target of about 2.3 per cent is as a result of the decrease in crude oil production from the Jubilee Oil Field.

The total economic activities for the year estimated in monetary terms is pegged at GH¢71,847.1 million with a per capita GDP of GH¢2,773.3.

The service sector, which is the largest sector of the economy, recorded the highest growth of 8.8 per cent, followed by Industry 7.0 per cent, with the agriculture sector recording the lowest growth of 2.6 per cent.

Though the estimates show an improvement in the growth of the Agriculture sector compared to 2011 growth of 0.8 per cent, its contribution to the economy continues to decline, with its share reducing from 25.6 percent of GDP to 23.1 per cent. Crop, however, remains the largest activity in the economy with a share of 19.3 per cent of GDP.

Industry, the second largest sector with a share of 27.6 per cent of the country’s economy, recorded a decline in growth from a record high of 41.1 per cent in 2011 to 7.0 per cent. This has been attributed to the decline in crude oil production, coupled with slow growth in manufacturing and production and distribution of water.

Apparently, all five sub-sectors of the Service sector recorded growth rates above 10 per cent. They are: activities that recorded growth rates above 10 per cent are: Hotels and Restaurants grew by 13.6 per cent; Transport and Storage, 11.4 per cent; Financial Intermediation, 11.4 per cent; Information and Communication, 12.1 per cent; and Business Services, 13.5 per cent.

Meanwhile, the second quarter GDP also released by the GSS on quarter-on-quarter basis (seasonally adjusted) was 2.4 percent. This means that, value of goods and services produced in the 2nd quarter of 2012 was 2.4 per cent higher than that of the 1st quarter of 2012.

The year-on-year growth rate for second quarter was 2.5 per cent, thus, compared to the 2nd quarter of 2011, value of goods and services produced was 2.5 per cent higher in the 2nd quarter of 2012

Also, on the quarter-on-quarter sectoral performance in the second quarter of the year showed that, Agriculture recorded the highest growth of 4.0 per cent; followed by Services which grew by 2.5 percent; and Industry recording a negative growth of -4.6 per cent.

Crop production recorded growth of 9.0 per cent. All other activities recorded declines in output, with livestock recording the largest decline of -24.7 per cent in agriculture sector.

Mining and quarrying was the main contributor to the poor growth in Industry sector. Mining and quarrying recorded a -15.8 per cent growth; Electricity and Construction also recorded negative growths of 2.2 percent and 1.2 percent respectively; Manufacturing and Water grew respectively by 3.9 percent and 1.0 per cent.

Subsequently, Four activities recorded high growths in the Services Sector and they were: Information and Communication 28.2 per cent; Financial Intermediation 18.2 per cent; Hotels and Restaurants 17.2 per cent; and Business Services 13.9 per cent.