Ghana’s economy to achieve highest growth rate in two years — Fitch Solutions

Fitch Solutions, an international rating firm, has predicted that Ghana’s economy would take off in the coming quarters and remain significantly stronger than in the previous two years.

The current prediction by the rating agency is a contrast to an earlier prediction that Ghana’s economy will grow by 3.8 percent in 2024.

In its latest prediction, Fitch has forecast that Ghana’s economy will grow at 4.3 percent in 2024 and expand by 4.5 percent in 2025.

Ghana’s economy has had moderate development over the last two years, with the country posting 3.1 percent growth rate in 2022 and falling to 2.9 percent growth rate in 2023.

Ghana’s economy is currently faced with a debt restructuring and an International Monetary Fund (IMF) programme.

The country is also faced with incessant currency depreciation and a sudden decline in its external reserve.

Experts have revealed that the IMF extended credit facility as well as success with the debt restructuring efforts could accelerate growth in 2024.

Ghana’s current inflation rate is 23.1 percent, with the local currency trading at 15.07 to the dollar.

The rating agency said although inflation had been sticky in the first quarter of 2024, it expected it to trend downward and reach 19.5 per cent by the end of the year, primarily facilitated by statistical base effects.

Fitch Solutions noted that slowing inflation, combined with stronger government spending ahead of the December general elections, will support consumer activity and boost domestic demand.

The rating agency also said that it expected that fixed investment would continue to recover, coupled with improved business confidence, which will result in stronger corporate investment.

Fitch stated that weaker net exports would constrain GDP growth and prevent it from reverting to pre-COVID levels of 5.3 per cent.

It said that while a marked recovery in crude oil production of 11 percent should support export growth, this, according to the rating agency, largely offsets a sharp fall in cocoa production, thus exports, as a result of adverse meteorological conditions.

The rating agency said it expected a solid recovery in imports due to growing domestic demand for foreign goods and services, which will weigh on net exports