fbpx

Oil to drive Ghana’s 2019 economic growth, says World Bank

BY: Suad Yakubu
Mr Kwabena Gyan Kwakye (right) addressing the media
Mr Kwabena Gyan Kwakye (right) addressing the media

The World Bank has predicted that Ghana’s economy will witness strong growth in 2019, driven largely by an expected increase in oil and gas production.

Similar to the projection by the Ghana government, the bank projects that the value of total economic activity, measured by gross domestic product (GDP), in 2019 will grow by 7.6 per cent.
The expected 7.6 per cent growth is higher than the 2.8 per cent growth projected by the bank for sub-Saharan Africa (SSA).

In its 2019 budget statement, the Ghana government projected the economy to grow by 7.4 per cent this year.

An economist at the World Bank Ghana Office, Mr Kwabena Gyan Kwakye, said the 7.6 per cent growth rate represented a 1.4 percentage point increase over the bank’s prediction for the economy in 2018.

He said this when he addressed the media on the sidelines of a video press conference from Washington, DC, USA, last Monday.

Ghana News Headlines

For latest news in Ghana, visit Graphic Online news headlines page Ghana news page

The video conference discussed the bank’s latest report, Africa’s Pulse, which is a bi-annual analysis of the state of African economies and projections into the future.

The conference was led by the World Bank’s Chief Economist for Africa, Dr Albert Zeufack.

Non-oil GDP

Mr Kwakye cited Ghana’s oil production as the main driver of the projected growth.

He added that the non-oil production sectors, such as mining, agriculture, services and manufacturing, would also be contributors.

“Oil production will pick up in 2019. Apart from oil production, we also expect higher non-oil growth, especially when government policies on agriculture are actually going to be felt much in 2019,” he said.

Sub-Saharan growth

On Sub-Saharan Africa, the report (Africa’s Pulse) said the 2019 growth rate projection for SSA is 0.5 percentage points higher than the 2.3 per cent growth rate recorded in 2018.

“We expect growth in SSA to recover to 2.8 per cent in 2019, supported by exports, private consumption, a rebound in agriculture and an increase in mining and services in some countries,” the report added.

Digital transformation

Earlier in his presentation of the Africa’s Pulse report, Dr Zeufack observed that digital transformation had the capability of unlocking new pathways for inclusive growth, innovation, service delivery and poverty reduction in Africa.

He said although there had been a surge in mobile connectivity on the continent, Africa must leverage on the emerging digital economy by improving infrastructure.

“While Africa has made great strides in mobile connectivity, the continent lags behind the rest of the world in access to broadband. There is still a long way to go,” he said.

He stated that increased digitisation could bolster per capita income growth by 1.5 per cent and reduce poverty by 0.7 per cent per year.

“The benefits of the digital transformation in SSA are even higher: it can increase growth by nearly two percentage points per year and reduce poverty by nearly one percentage point per year,” he said.

He stressed the need for digital skills and entrepreneurship and platforms within the digital space.