Economy projected to have expanded by 8.9% in quarter 2

Proof’dThe economy is projected to have expanded by 8.9 per cent in the second quarter of this year, even before the Ghana Statistical Service releases the growth rate data for the period.

According to accounting and auditing firm, Deloitte Ghana, the expected increase in international trade, following the easing of restrictions in most economies, is expected to drive demand for commodities, which is favourable for commodity exporting countries like Ghana.

“This, coupled with the general increase in economic activity in 2021 is expected to help achieve the targeted growth. However, a critical success factor is how well we handle the rising COVID-19 cases. A strict enforcement of COVID protocols as well as an effective roll out of COVID vaccination will sustain the economic recovery process,” it pointed out.

Partner in charge of Financial Advisory at Deloitte Ghana, Yaw Lartey, told Joy Business “the estimated Gross Domestic Product for 2021 is about ¢433 billion. This represents a growth of 8.9 per cent compared to GDP as of the same period 2020. The key driver of the growth was the Agriculture sector which grew by about 18 per cent, largely on account of growth in the Crop subsector. We believe that some of the programmes and activities introduced by government are beginning to yield results, particularly those that support the Crop sub sector.”

“Also, we saw a significant growth in the Services sector, particularly in the Hotels and Restaurants sub sector. As we noticed, the COVID-19 adversely impacted on this sector, but we see some recovering in the economy – we see some activities going on in the Hotels and Restaurant sub sector. That contraction we witnessed last year of about 44 per cent contraction, we’ve see a growth this year and that is driving the Services sector to grow at about nine per cent,” he added.

The economy witnessed pick-up in economic activity in the second quarter of this year, compared with the same period of last year in which there was virtually non-existent in demand and supply due to the partial lockdown and restrictions.

According to Deloitte, “initiatives such as the Ghana CARES “Obaatan Pa” programme, which is expected to aid in the recovery of the economy post COVID and expected increase in business activity.”

The government is forecasting five percentage points expansion in the economy this year. This is line with projections by international institutions including the Economist Intelligence Unit, Fitch Solutions and the International Monetary Fund.

The accounting and auditing firm said the general increase in economic activity this year is expected to help achieve the targeted growth.

However, it cautioned the country to be mindful of the third wave of COVID-19.

The economy recorded a 3.1 per cent Gross Domestic Product in the first quarter of this year.

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

The Agriculture sector recorded the highest growth of 4.3 per cent.

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