Ghana’s Economic Growth Slows as Cocoa Sector Shrinks

Ghana’s economy grew by 3.6% in Q4 2024, marking its slowest growth in a year due to industrial stagnation and a 21.4% drop in cocoa production. Challenges for President John Mahama’s administration include poor weather, crop diseases, and smuggling. The finance minister’s upcoming budget presentation is anticipated to address these issues.

In the fourth quarter of 2024, Ghana’s economy experienced its slowest growth in over a year, attributed to stagnation in industrial activities and a significant decline in the cocoa sector. According to Government Statistician Samuel Kobina Annim, the Gross Domestic Product (GDP) grew by 3.6%, a decrease from 7.2% recorded in the third quarter.

Industrial growth remained nearly stagnant at 0.2%, following a robust 10.4% expansion in the third quarter. The agriculture sector, employing 40% of the workforce, experienced a modest growth rate of 2.9%, down from 3.2% in the previous quarter. In stark contrast, cocoa output plummeted by 21.4%, marking the sixth consecutive quarter of decline for this crucial sector.

The economic slowdown poses a significant challenge for President John Mahama’s administration, which had promised to reinvigorate the economy following a debt default in 2022 and subsequent International Monetary Fund (IMF) bailout. His finance minister, Cassiel Ato Forson, is scheduled to present the government’s initial budget on Tuesday.

As the world’s second-largest cocoa producer, Ghana confronts multiple hurdles, including unfavorable weather conditions, crop diseases, and rampant cross-border smuggling, which have led to higher prices for cocoa beans outside the national market.

In summary, Ghana’s economic growth has notably decelerated, primarily due to stagnation in industrial activities and a substantial decrease in cocoa production. This situation places significant pressure on the government to implement effective strategies to revitalize the economy. With the impending budget presentation by finance minister Cassiel Ato Forson, all eyes will be on government policies aimed at addressing these economic challenges.

Original Source: techlabari.com