Economic growth to surpass IMF forecast — BoG
Economic growth to surpass IMF forecast — BoG

Economic growth to surpass IMF forecast — BoG

Ghana’s economy is bound to grow twice higher than the 1.5 per cent projected by the International Monetary Fund (IMF) at the end of the year, the Bank of Ghana (BoG) has projected.

The central bank based its projection on the strong economic growth, measured by the Gross Domestic Product (GDP) growth for the first and second quarters and positive outlook indications given by the BoG’s Composite Index of Economic Activities.

Under the country’s $3 billion programme with the IMF, economic growth for 2023 is projected to be 1.5 per cent.

The stronger growth performance is important in boosting investor confidence in the economy.

Addressing a press conference after the 114th meeting of the BoG’s Monetary Policy Committee (MPC), the Governor of the Bank of Ghana, Dr Ernest Addison, said the MPC after its review was projecting a growth of three per cent.

“If you look at the IMF programme, the growth target was set at 1.5 per cent but we have been looking at the GDP numbers that have been coming out in the year so far.

“We have also looked at the behaviour of our Composite Index of Economic Activities and we are seeing a positive trend which indicates a strong growth.

We have also looked at the Ghana Purchasing Managers Index and all these suggest to us that growth is more robust than expected under the IMF programme,” the Governor explained.


Economic growth has been relatively strong in the first half of 2023, with the latest data released by the Ghana Statistical Service showing real GDP growth of 3.2 per cent in the second quarter of the year, marginally down from the 3.3 per cent recorded in the first quarter.

Trends in the BoG’s high frequency real sector indicators also point to a sustained turnaround in economic activity.

The updated real Composite Index of Economic Activity (CIEA) contracted at a slower pace by 2.8 per cent year-on-year in July this year, indicating a slight improvement from a contraction of 3.1 per cent in June 2023 and 3.7 per cent in May 2023.

Dr Addison said the Business Confidence Index reflected the achievement of short-term company targets, with positive sentiments about industry prospects due to improving consumer demand and the relative stability in the local currency.

However, he said the Consumer Confidence Index dipped due to the utility tariff adjustments and recent increases in ex-pump petroleum prices.

Ghana’s Purchasing Managers’ Index (PMI) for August 2023, on the other hand, increased for the sixth successive month, pointing to a sustained improvement in business activity.

The Governor stated that with the IMF team currently in town for a review, the issue on the growth projection would be on the table for discussion.

“We have to convince them that from the indicators that we are seeing, we think that the 1.5 per cent projection is too low”.

“We will provide them with the available data and evidence which makes us think we will do better and at the end of the mission, we will reach an agreement on what the common view is regarding the growth projection,” Dr Addison stated.

Inflation target

With regard to inflation, the Governor said the long-term objective was to get back into the single digit target which would happen over a three years’ period.

He said the central bank was concerned in the second quarter when inflation got stuck around 42 per cent, but with the drop seen in August, it was confident that it would soon get back to the path which should lead it to the 29 per cent being forecast.

The latest price reading in August 2023 indicated a fall in headline inflation, after consecutive upward trends since May 2023.

Headline inflation dropped to 40.1 per cent, from 43.1 per cent in July and 42.5 per cent in June 2023, respectively.

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