Economist Intelligence Unit projects slow economic growth for Ghana, PWC and World Bank project otherwise

In the research institution’s country report for Ghana which was released this month, the economy will grow by 6.5 percent, which is a 1.1 percentage point lower than the government’s target of 7.6 percent.

The cut in growth rate is attributed to a projected slow growth in agriculture. It has projected the agriculture sector to grow by 3.4 percent in 2019 compared to the 4.8 percent growth recorded last year.

“Consumer demand will remain robust during the year, helped by the lower cost of credit, but ultimately constrained by low value added in the agricultural sector, which serves to limit wage growth for workers, and price rises moderating consumer sentiment. Accordingly, we forecast overall GDP growth of 6.5 percent in 2019,” the report said.

The EIU also expects growth to ease to 5.7 percent in 2020 as the country is affected by weaker global economic conditions, weighing on investment flows into the country.

The institution adds that government and private consumption levels will rise slightly ahead of the election that year.

Meanwhile, PWC’s (a global network of firms delivering world-class assurance, tax, and consulting services for your business) analysis of the 2019 budget says the growth target of the government is ambitious but achievable given some policy interventions implemented by the government.

“Government has projected the Ghanaian economy to grow at 7.6 percent in 2019. Though ambitious, the projected GDP growth rate of 7.6 percent for 2019 is expected to come from the implementation of government’s industrialisation programmes such as 1D1F and the widening of the tax net,” the PWC said.

The World Bank projection also reveals that the country’s economy will witness strong growth in 2019, largely driven by an expected increase in oil and gas production, saying the economy will grow by 7.6 percent, the same as the government's target.