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Select Economic and Financial Indicators2014201520162017e2018f
Real GDP (% change)
GDP (USD bn)38.836.942.845.549.2
Inflation (average)15.517.217.512.49.0
Fiscal Balance (% GDP)-10.9-5.4-8.7-6.3-4.5
Broad Money (% change, end period)36.823.324.830.022.0
Population (mn)27.027.628.228.829.5
Exports (USD bn)15.316.517.518.720.5
Imports (USD bn)19.220.820.522.023.5
Current Account Balance (% GDP)-9.5-7.7-6.6-4.6-2.0
FX Reserves (USD bn, end period)
Exchange Rate (average)
Oil production (mn bpd)0.1050.1050.1300.1480.187
Sources: IMF, World Bank, UN, Bloomberg, EIA, BP, Ecobank Research

Economic Outlook

Economic Outlook

Real GDP: The 2018 outlook for Ghana remains strong, amid an expansionary 2018 government budget, rising energy production and increased oil prices. Despite this we expect growth to slow somewhat from 2017, after reaching above 8%. This slowdown will be partly due to base effects following the rebound in oil production last year, given production challenges in 2016; the commencement of production from the Tweneboa-Enyenra-Ntomme (TEN) and Sankofa-Gye Nyame oilfields in Q3 2016 and Q3 2017, respectively, helped to flatter the 2017 growth rate, after oil production fell significantly during H1 2016 due to damage to the Kwame Nkrumah floating production, storage and offloading (FPSO) vessel – the country’s only FPSO at the time. In addition, planned repair works to the Kwame Nkrumah FPSO have been delayed from late 2017 into early 2018, along with the associated temporary output reduction. Nonetheless, the recent boost to activity in this sector will positively impact other sectors of the economy. Furthermore, the government’s 2018 budget outlines plans to raise spending by 25.7% (with a 50% increase in capital expenditure) compared to the estimated 2017 budget outturn. Growth will also be supported by improved investor sentiment following the country’s progress in implementing reforms as part of the three-year IMF economic reform and stabilisation programme that commenced in April 2015. In September last year, the programme was extended by one year, to April 2019. Alongside this, positive sentiment has been boosted by a new government administration (elected in December 2016) deemed to be more pro-business. Additionally, in May and October 2017, S&P and Fitch, respectively, upgraded their ratings outlooks on Ghana’s long-term bonds (Fitch from B negative to B stable; S&P from B- stable to B- negative).

Inflation: Inflation is forecast to further decelerate in 2018, after slowing to 12.4% last year, from 17.5% in 2016. A disinflationary trend since June 2016 has enabled the Bank of Ghana to implement a monetary policy easing cycle, beginning in November 2016 (cutting the MPR to 20% by end-2017, from 26% in October 2016). We expect the disinflationary process to continue, particularly given a planned electricity tariff reduction of 13% for 2018, and anticipate that the inflation rate will reach the medium-term target of 8% (+/- 200bp) this year. However, if there is any weakening of the government’s resolve to tighten spending controls, or significant weakening of the GHS, inflationary pressures will rise again.

Fiscal balance: The fiscal deficit is expected to tighten further in 2018, after narrowing to an estimated 6.3% of GDP in 2017 (in line with targets), from 8.7% of GDP the year before. The improvement in 2017 came from government containing public expenditure in line with revenue, which fell short of targets due to delays in tax implementation measures, slow non-oil GDP growth and a 30% slump in the price of cocoa. Also, early that year, biometric registration for public sector employees led to the elimination of about 50,000 suspected ghost workers and unidentified pensioners. This was an improvement over 2016, in which government revenue shortfalls (amid oil production challenges) and expenditure overruns (amid the 2016 presidential election) caused the deficit to overshoot significantly. Going forward, higher oil revenues – due to higher prices and production levels – and a recovery in cocoa prices will help to ease fiscal pressures, alongside continued progress with IMF supported reforms, and efforts to boost tax revenues (such as reducing tax exemptions and tackling tax evasion). We expect the deficit to narrow to below 5% of GDP in 2018, as ongoing efforts to rationalise spending continue to play an important role. Additionally, the Bank of Ghana’s current monetary policy easing cycle, and the resulting lower interest rates will help to ease government borrowing costs, alongside Fitch’s and S&P’s upgraded outlooks for Ghana’s long-term bonds. However, despite some success and ongoing reforms, debt sustainability remains fragile (with debt close to 70% of GDP); and a stronger medium-term consolidation path to stabilise public debt and debt service at sustainable levels (given the high debt service-to-revenue ratio) is necessary.

Current account: deficit is likely to narrow further, reaching around 2.0% of GDP in 2018, after it was reduced to 4.6% of GDP in 2017, from 6.6% of GDP a year earlier. This will be supported by higher oil and cocoa export revenues – amid rising prices for both and increased oil production. Alongside this, high gold prices (amid global economic uncertainty) are expected to help improve the external account. However, this will be countered somewhat by a stronger growth in import demand. The improved current account outlook in 2018 is also based on the assumption that fiscal spending/revenue and other structural reforms continue to be implemented successfully, which in turn will lower import demand.


  • The economic situation has improved but downside risks remain: the country’s continued reliance on commodities (gold, cocoa and oil) will sustain its vulnerability to commodity price shocks. This will add pressure to FX reserves, undermining the GHS outlook, and requiring a policy response from the Bank of Ghana.
  • Weakening growth in China, an important investment and trade partner for Ghana, will restrain exports and investment inflows.
  • Weak progress with reforms would undermine stabilisation efforts, derailing the disinflationary process, and raising concerns over the exchange rate.
  • If there is only limited progress made with implementing reforms, the MPR would need to rise in order to counter inflation-inducing higher government spending.
  • Domestic-driven exchange rate risk (linked to M2 supply growth) is compounded by the effect of US monetary policy normalisation that could lead to increased capital flowing out of Ghana seeking less risky investments.

FX, FI and Commodity Information

FX, FI and Commodity Information

Exchange Rate Structure

TargetNo target, but BoG intervenes to limit volatility
Type of interventionVia spot market
Convertible currency?No
Market participantsn/a
Source: Bloomberg, IMF, and Ecobank Research


FX ProductsSpotForwardsNon-deliverable ForwardsOptionsSwaps
On offerYesYes – up to 12 monthsYes – up to 12 monthsNoYes
Daily trading volume (USD mn)n/an/a
Average trade size (USD mn)
Average spread
Trading hours09:00-16:00
Settlement cycleT+2T+Tenor+2T+Tenor+2n/aT+2
FX Market StructureBoG, mining firms and donor orgnisations, are  major providers of FX.
Non-resident FX RegulationsSpotForwardsNon-deliverable ForwardsOptionsSwaps
Trade and FDI flowNo restrictionsn/a
Financial flowRestricted to treasury bond of 2-yrs and above
Resident FX RegulationsSpotForwardsNon-deliverable ForwardsOptionsSwaps
Trade and FDI flowNo restrictionsn/a
Financial flow
Source: Bloomberg, IMF, and Ecobank Research


Primary MarketTreasury billsTreasury notesSavings bondsTreasury bondsOMOs
IssuerGovernmentn/aGovernmentGovernmentCentral bank
End useGovernment financingGovernment financingGovernment & infrastructure financingLiquidity management
Maturity structure91- to 364-days2-3years2- to 20-yr7-days to 364-days
Coupon paymentsn/aQuarterlySemi-annualn/a
Secondary Market
Daily trading volumen/aLimited tradingLimited trading
Average trade sizeNGN250mn between money market dealers, and NGN1bn between CBN and money market dealers NGN50mn quoted for Bonds ≥ NGN30bn < NGN75bn volume in issue, whilst NGN100mn for bonds above NGN75bn
Settlement cycleT+2

Ecobank local affiliate contact details:
Ecobank Nigeria, Plot 21 Ahmadu Bello Way, Victoria Island, Lagos, Nigeria.
Tel: +234 1 444 86 20 / 24
Source: Bloomberg, IMF, and Ecobank Research

FI Primary Market information

FI Primary Market information

Ghana debt

Ghana Debt2014201520162017e2018f
Government debt (% GDP)
    Sub-Sahara average44.552.656.155.655.8
External debt (official creditors, % GDP)35.842.838.536.033.9
    Sub-Sahara average25.530.231.932.933.2
External public debt stock (USD bn)13.915.816.516.416.7
    Share of total sub-Sahara debt (%)
Source: IMF; Ecobank Research

Banking Sector Information

Banking Sector Information

Ghana has a well-developed banking sector, regulated by the Bank of Ghana (BoG). There were a total of 26 banks operating in the country at end-2015, including two new commercial banks that were licensed that year: GN Bank and First National Bank (FNB). Total assets rose by 23.1% year-on-year in local currency terms to an equivalent of US$16.7bn at end-2015. This growth was driven by two factors: first, a 26% year-on-year growth in gross loans to customers; and second, an 18% year-on-year growth in banks’ Treasury bills and securities (all growth rates expressed in local currency terms). In terms of asset structure, net loans accounted for 43% of total assets, liquid assets (cash, balances due from other banks and investment securities) accounted for 49%, with non-earning assets making up the balance (see table below).

Comparative breakdown of key balance sheet items, (US$Mn)

Foreign Assets1,4851,398
Domestic Assets14,64115,217
Advances (Net)6,9647,111
of which Foreign Currency2,2592,308
Cedi Loans4,7054,803
Gross Advances7,5567,940
Other Assets1,0401,350
Total Assets16,12616,615
Total Customer Deposits10,16610,829
Total Borrowings2,5772,494
Other Liabilities1,032890
Source: BoG Financial Stability Report 2015.

Public sector activity drives lending

Wholesale loans continue to drive lending activities in Ghana, accounting for 78% of total outstanding loans at end-2015, while consumer loans accounted for only 15%. In addition, we estimate that loans to parastatals (especially those operating in the energy sector) accounted for more than half of wholesale loans. Most of this lending was in the form of documentary credits, but owing to risk crystallization it was moved onto the balance sheet. This view, explains why trade made up the largest share of outstanding loans by sector, with trade finance accounting for 26% of total credit. The three largest recipient sectors of credit – Commerce & Finance, Services, and Electricity, Gas & Water – together accounted for 62.3% of credit allocation as at December 2015 (see charts below). The asset strategies of Ghanaian banks tend to focus on wholesale (corporates and parastatals) and SME (small and medium enterprises) lending. As a result, competition in the Ghanaian market is focused on two variables: balance sheet and pricing.

Foreign currency lending has declined

Foreign currency lending has continued to decline, primarily owing to the BoG’s de-dollarization of the economy over the past decade. The proportion of foreign currency loans fell from 44% of total loans at end-2013 to 32% at end-2015. The declining macro environment also triggered flight to foreign currency exposures by corporates and high net worth individuals on the basis that foreign currency lending rates were less volatile than Cedi lending rates. However, with Ghana’s macro environment improving we expect the share of foreign currency loans to rise back to 45% of total loans in 2017-18.

Asset performance has deteriorated significantly

The ratio of non–performing loans (NPLs) to gross loans (the NPL ratio) has been in double-digits since 2009 and by end-2015 had surged to 14.9%, up from 11.3% at end-2014. Loan non-performance has been fuelled by the mountain of legacy debt resulting from unpaid subsidies on energy prices and foreign exchange under recoveries in relation to parastatals operating in the energy sector; these include the Tema Oil Refinery (TOR), Volta River Authority (VRA), Ghana Grid Company (GRIDCo), Electricity Company of Ghana (ECG) and the Bulk Distribution Companies (BDCs). Consequently, these entities were unable to meet their obligations to commercial banks, pushing up the level of NPLs. In response the government introduced the Energy Sector Levies Act 2015 (Act 899) in order to raise revenue to help settle the debts owed by state-owned enterprises in the energy sector. Collections of this levy, in addition to restructuring, have since averted any potential systemic risks.

Capital Adequacy remains adequate

At end-2015 Ghanaian banks recorded a slight weakening in capital adequacy ratio (CAR) levels. As measured by the ratio of risk-weighted capital to risk–weighted assets, CAR levels declined to 17.9% from a high of 18.6% at end-2012, primarily as a result of loan write-offs. Despite this decline, the banking sector’s CAR remained well above the 10% prudential and statutory requirements, reducing the pressure on them to raise additional capital and averting any systemic risks.

Profitability has declined

Profitability in Ghana’s banking sector declined in FY2015, with the return on shareholder funds declining from 26.6% in FY2014 to 19.2% in FY2015. This decline was driven by two factors: first, banks’ blended cost of funding surged in FY2015 with interest rates payable on customer liabilities rising from 7.6% in 2014 to 9.8% in 2015; this in turn increased interest expenses by 65% year-on-year. Second, asset performance levels weakened considerably, doubling loan loss provisioning. We expect these factors to continue affecting profitability while the challenging macro environment continues.

Commodity and Trade Information

Commodity and Trade Information

Hydrocarbon & Mineral Production

Ghana is Middle Africa’s leading gold producer, with output of 128 tonnes in 2016 and an estimated 2,000 tonnes of reserves. However, the dramatic growth in informal gold mining (‘galamsey’), estimated at 45 tonnes per year, is encroaching on agricultural land (in particular cocoa plantations) and causing environmental damage. In response the government suspended a number of small-scale mining licences in May 2017. The country’s other significant mineral output is alluvial diamonds, with 142,000 carats produced in 2016, manganese ore (2mn tonnes), bauxite (1.3mn tonnes) & aluminium (34,000 tonnes). Ghana had installed cement capacity of 6.7mn tonnes in 2015, all of which was for domestic use. The government plans to expand domestic production of aluminium and in June 2017 signed an MOU with China worth US$10bn to build supporting rail infrastructure.

Ghana is a nascent crude oil producer whose importance continues to grow as its output and reserves increase. The huge Jubilee offshore fields have recoverable reserves of 730mn barrels, with all production taking place via FPSO. Since the first commercial production began at the Jubilee field in December 2010, output has risen from 31,000 bpd in 2011 to 161,000 bpd in 2017. Ghana currently has three producing fields with a combined potential output of 275,000 bpd. However, further production growth has been limited by technical challenges at the Jubilee field. Ghana also has an estimated 1.45 Tcf of gas reserves in the OCTP field. Output from this field is intended to supply local power plants in an effort to ease Ghana’s dependence on Nigeria for gas supply.

Ghana’s sole refinery, the Tema Oil Refinery (TOR), has faced chronic financial challenges and was shut down in January 2017. The government has plans to build a new refinery, as well as to renovate TOR, but for the foreseeable future Ghana will need to import all of its refined products. Ghana consumed 3.4mn tonnes of refined products in 2016, 6% less than the previous year. Diesel represents 52% of the country’s petroleum product consumption.

Soft commodity production

Ghana is the world’s second largest cocoa producer (after Côte d’Ivoire), with estimated output of 950,000 tonnes in 2016/17 (October-September), equal to 20.2% of world production. Production surged from the previous season, which was hampered by erratic weather, supported by high farmgate prices, improved provision of inputs and mass-spraying against disease/pests, as well as the ongoing replanting programme. However, concerns remain over the impact the slump in world cocoa prices will have on the government’s ability to maintain high farmgate prices in 2017/18, while the high proportion of unproductive tree stock (40% of the total) remains a drag on output.

Unusually for Middle Africa, Ghana’s cocoa sector is directly controlled by the government through the cocoa regulator, the Ghana Cocoa Board (Cocobod). Cocobod sets fixed producer prices at the beginning of the season and exports beans through its marketing arm, Cocoa Marketing Company (CMC). Major reform of Cocobod is underway, including a review of how inputs are provided to the sector and the country’s marketing infrastructure. In June 2017 Ghana signed an accord with Côte d’Ivoire to improve coordination between the two cocoa sectors, with a view to stamping out bean smuggling and start exerting more influence over international cocoa prices.

Ghana is a smaller cocoa grinder than its neighbour, Côte d’Ivoire, with estimated grindings of 220,000 tonnes in 2016/17, 5% of the world total. Ghana’s grinding sector is constrained by the erratic supply of beans, especially of light crop beans for which grinders receive a discount, offsetting their higher production costs and allowing them to make a profit. The chronic lack of light crop beans, coupled with power cuts, has raised questions over the long-term commercial viability of Ghana’s grinding sector.

Aside from cocoa, Ghana produces a wide range of agricultural goods. These include food crops such as milled rice (390,000 tonnes in 2016), and a variety of cash crops; in 2017 Ghana produced 560,000 tonnes of crude palm oil (the second largest producer in SSA after Nigeria), 165,000 tonnes of raw cashew nuts, 83,000 tonnes of timber, 60,000 tonnes of Shea nuts (used in the food and cosmetics sector), 53,000 tonnes of bananas and 22,000 tonnes of natural rubber (NR).

Trade Flows


Ghana’s imports totalled an estimated US$11.4bn in 2016. Capital and consumer goods, industrial raw materials, food and petroleum products made up the bulk of imports, which were destined for the domestic market, reflecting Ghana’s middle income status. Vehicles & machinery were the largest import, worth US$3.3bn, reflecting the relatively underdeveloped local manufacturing sector, along with electronics, worth US$1bn. The country also imported US$836mn worth of iron & steel, US$396mn worth of plastics and US$199mn of petroleum products. Given the high level of domestic demand, Ghana is dependent on food imports, importing US$287mn of rice, US$161mn of wheat and US$108mn of palm oil in 2016.


Ghana’s exports totalled US$10.7bn in 2016. The country’s exports are dominated by commodity flows. Gold remains the country’s most valuable export, worth US$4.4bn in 2016, most of which went to Switzerland, the UAE, India & South Africa. Cocoa and cocoa products were the next largest export, totalling US$1.9bn, most of which were exported to Western Europe. The bulk of these exports were made up of raw cocoa beans (581,375 tonnes). Crude oil exports were the third most valuable export, worth US$1.1bn, with the key export markets being China, the EU & Taiwan. The rest of Ghana’s commodities are exported to world markets, including cashew nuts (US$988mn), wood (US$482mn) and manganese ore (US$101mn).

  • Flag
  • Population
  • Area
    238,533 km2
  • Capital
  • Largest city
  • Official language
  • Major languages
    Twi, Asante, Ewe, Ga
  • Currency
    Ghana Cedi (GHS)

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