The economy grew by 4.7 percent year-on-year in the first quarter of 2024
The economy grew by 4.7 percent year-on-year in the first quarter of 2024, significantly outpacing the 3.8 percent growth recorded in the same period last year according to provisional data from the Ghana Statistical Service (GSS).
This performance underscored the resilience and dynamism of key sectors, positioning the nation on a firm recovery trajectory.
On a seasonally adjusted basis, GDP when accounting for inflation increased by 1.2 percent from the fourth quarter of 2023 – building on the previous period’s one percent quarter-on-quarter growth. This steady expansion signals sustained economic momentum, driven by strategic sectoral performances.
Key sectoral contributions
The Mining & Quarrying sector emerged as a standout performer, registering a stellar 12.9 percent growth. This sector’s resurgence also reflects an uptick in global commodity prices. Meanwhile, the Information & Communication sector, pivotal in the digital transformation agenda, surged by 17.9 percent – highlighting robust investments from key players and heightened consumer demand for digital services.
Agriculture, particularly the Crops sub-sector, grew by 4.3 percent while the Construction sector also demonstrated solid growth by expanding 8.2 percent, indicative of ongoing infrastructure projects and increased capital expenditure. The Accommodation & Food Services sector rebounded strongly, posting 9.4 percent growth as the hospitality industry continues to recover from a pandemic-induced downturn.
Areas of Contraction
Despite the overall positive economic tone, several sectors experienced contractions. The Health sector shrank by 8.8 percent, raising concerns about underlying challenges in healthcare delivery and funding. The Electricity sector’s woes were illustrated by a 7.5 percent decline.
The Public Administration and Education sectors also contracted – by 5.3 percent and 4.9 percent respectively, suggesting possible budgetary constraints and operational efficiencies.
Other Personal Services and Forestry & Logging sectors saw marginal declines of 2.9 percent and 1.2 percent respectively.
These contractions highlight uneven recovery across different economic segments and the need for targetted policy interventions.
Nominal GDP Insights
Nominal GDP at current prices reached GH¢266.7billion in Q1 2024, a substantial rise from GH¢212.1billion in Q1 2023. The Services sector maintained its dominance, contributing 45.6 percent to GDP – underscoring its critical role in economic activity. The Industry sector, buoyed by mining and construction, contributed 30.6 percent while Agriculture accounted for 23.8 percent.
Outlook and Policy Implications
Analysts say the growth figures reflect recovering economic fundamentals and effective policy measures. However, the contractions in key sectors like health and electricity underscore the need for strategic interventions. Policymakers may need to focus on enhancing healthcare funding, addressing energy supply challenges and improving public sector efficiency to sustain inclusive growth.
As the nation continues on its path to economic recovery, they argue that the focus will likely remain on bolstering sectoral performances while addressing structural weaknesses. Continued investment in digital infrastructure, mining and construction will be crucial, alongside targetted support for lagging sectors.
The remainder of 2024’s economic outlook appears optimistic, provided that government can effectively manage sectoral disparities and sustain its growth momentum.
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