Ghana records 5.6% GDP growth rate in the third quarter of 2019, the lowest in the year

Ghana’s economy has recorded a Gross Domestic Product (GDP) growth rate of 5.6% for the third quarter of this year.

Finance Minister, Ken Ofori Atta

The growth rate is the lowest recorded for the year compared to the 6.7 percent recorded in the first quarter and the 5.7 percent recorded in the second quarter.

This was contained in a December 2019 data by the Ghana Statistical Service (GSS).

Now compared to the same period in 2018, this is the lowest since the second quarter of 2018.

According to the data, the Agric sector, recorded the highest growth of 5.9 per cent, while the services and industry sectors, all recorded a 5.7 per cent growth rate.

This is also the first time of the third quarter of 2018 that the Agric sector has outperformed all the sectors.

Based on the data released by the Ghana Statistical Service, the industry’s performance was influenced by the high growth of Electricity which went up 10.8 per cent, Mining and Quarry which includes oil as well as manufacturing.

The Services sector’s growth was also influenced by the strong growth of the Information and communication sub-sector, which expanded by 26.4 per cent.

Highlights

The Q3 2019 GDP at current prices was estimated at GH¢85,268.5 million. The corresponding value recorded for Q3 2018 was GH¢74,222.6 million.

In constant terms, the Q3 2019 GDP was estimated at GH¢41,512.7 million. For Q3 2018, the estimated value was GH¢39,299.4 million.

The year-on-year quarterly GDP (Oil) growth rate for Q3 2019 was 5.6% compared to the 7.4% recorded for Q3 2018.

The year-on-year quarterly GDP (Non-Oil) growth rate for Q3 2019 was 4.6% compared to the 8.5% recorded for Q3 2018. A decline of 3.9% from 2018Q3.

The quarter-on-quarter GDP growth rate (seasonally adjusted) for Q3 2019 was 1.4%. The rate recorded for the third quarter of 2019 was also 1.4%.

Total expenditure in the oil and gas industry for 2019

According to the GSS data, the total expenditure in the oil and gas industry for 2019 is projected to reach $3.1 billion up from $2.336 billion and $2.617 billion in 2017 and 2018 respectively.

Total costs within the oil and gas industry are divided into five main cost categories; exploration, appraisal and concept studies; field development; production; abandonment and onshore activity. This release captures data for three cost categories: Exploration, appraisal and concept studies, Field Development and Production.

The exploration, appraisal and concept studies and field development categories costs are considered as capital expenditure (CAPEX), while production costs are considered as an operational expenditure (OPEX).

Total expenditure on field development in 2017 was $1.8 billion representing 70 percent of the total cost. Production cost was $462 million (26%) and exploration cost was $86 million (4%). The share of field development cost, however, declined in 2018 and 2019.

A total of $1.7 billion representing 64 percent was expended on field development activities in 2018 and $1.2 billion is forecasted to be expended in 2019 representing 39 percent of the total cost.

The total expenses on oil and gas activities for 2018 is 12 percent higher than the corresponding figure for 2017.

The increase from 2017 to 2018 is due to higher expenditure within exploration, appraisal and concept studies and production, while the decline within the field development category dampened growth in total expenditures.

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