Economy - overview: Ghana's economy was strengthened by a quarter century of relatively sound management, a competitive business environment, and sustained reductions in poverty levels, but in recent years has suffered the consequences of loose fiscal policy, high budget and current account deficits, and a depreciating currency. Ghana has a market-based economy with relatively few policy barriers to trade and investment in comparison with other countries in the region, and Ghana is well-endowed with natural resources.
Agriculture accounts for about 20% of GDP and employs more than half of the workforce, mainly small landholders. Gold and cocoa exports, and individual remittances, are major sources of foreign exchange. Expansion of Ghana’s nascent oil industry has boosted economic growth, but the fall in oil prices since 2015 reduced by half Ghana’s oil revenue. Production at Jubilee, Ghana's offshore oilfield, began in mid-December 2010. The country’s first gas processing plant at Atubao is also producing natural gas from the Jubilee field, providing power to several of Ghana’s thermal power plants.
As of 2016, key economic concerns facing the government include the lack of reliable electricity and the high debt burden, even amidst strong GDP growth. While the MAHAMA administration attempted to ameliorate these concerns, little progress has been made, leaving much work to be done in 2017 by the incoming AKUFO-ADDO administration. Ghana signed a $920 million extended credit facility with the IMF in April 2015 to help it address its growing economic crisis. The IMF fiscal targets require Ghana to reduce the deficit by cutting subsidies, decreasing the bloated public sector wage bill, strengthening revenue administration, and boosting tax revenues. Priorities for the AKUFO-ADDO’s administration include rescheduling some of Ghana’s $31 billion debt, stimulating economic growth, reducing inflation, and stabilizing the currency. Prospects for new oil and gas production, potentially higher global gold prices, and follow-through on tighter fiscal management are likely to help Ghana’s economy in 2017.
Definition: This entry briefly describes the type of economy, including the degree of market orientation, the level of economic development, the most important natural resources, and the unique areas of specialization. It also characterizes major economic events and policy changes in the most recent 12 months and may include a statement about one or two key future macroeconomic trends.
Source: CIA World Factbook - This page was last updated on July 9, 2017