Fitch: Ghana’s economy to become fastest growing in Sub-Saharan Africa in 2021

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Ghana’s economy is expected to become the fastest growing in sub-Saharan Africa this year, Fitch Solutions has said.

It is projecting a 4.8% expansion in the economy, consistent with that of the International Monetary Fund, Moody’s and Standard Bank, but in sharp contrast with the World Bank, which is forecasting a modest 1.4% Gross Domestic Product (GDP) growth rate.

In its assessment of economies in Sub-Saharan Africa, Fitch Solutions said Ghana’s economy will grow strongly because of a healthy rebound in private consumption and exports.

“We expect real GDP growth rate to accelerate to 4.8% in 2021 on the back of a healthy rebound in private consumption and exports. Government spending will remain elevated in the coming quarters, and support the economic rebound”

Additionally, “consumer and business confidence are expected to remain high in third quarter of 2021”, it explained.

“Sporadic protests likely in the coming months, notably over government concerns, but we think this will be fairly on a small scale and unlikely to have detrimental effect on the growth outlook.”

Senior Risk Analyst at Fitch Solutions in charge of sub Saharan Africa, William Attwell told Joy Business “the outlook for Ghana is considerably more upbeat and we focus fairly robust GDP Growth rate of 4.8% which is among the highest rates for any SSA economies. And this reflects a fairly strong consumer recovery, second tranche of government stimulus spending and fairly healthy exports performance”.

“As a case in other SSA markets, Ghana experienced an initial rebound in growth, real GDP rising by a steady if not a spectacular in Q1 (quarter one) by 3.1%. But the economy has subsequently faced headwinds”, he added.

The Ghanaian economy expanded by 3.1% in the first quarter of this year, the lowest since the same period in 2019.

However, in same period of 2020, the GDP growth rate was 7.0%.

According to figures from the Ghana Statistical Services, Construction (14.2%)), Manufacturing (6.1%) as well as Information and Communication (22.1%) sub sectors were the main drivers of growth for the first three months.

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