Ghana’s current account deficit is expected to narrow to 1.9% of Gross Domestic Product in 2023, UK-based Economist Intelligence Unit has revealed.
It is also forecasting a further drop in the current account to 1.1% in 2024 as international prices for refined fuel imports decline from their 2022 peak, whilst contracting domestic demand in 2023 and more stringent regulations on imports suppress the import bill.
The deficit will however widen in 2025-27, reaching 2.7% of GDP in 2027, as the primary income deficit grows.
“Although export earnings from gold and cocoa (which are among Ghana's major commodities) will rise, revenue from oil exports will fall in 2023-24 as oil prices decline from peak 2022 levels, narrowing the trade surplus”, it explained.
EIU continued that the trade surplus will widen in 2026-27 as growth in export receipts, driven by a strong rise in oil and gold output, exceeds growth in the import bill.
Services account to remain in deficit
The services account will also remain in deficit in 2023-27, given the expenditure on technical services for hydrocarbons and mining projects.
However, the deficit will narrow gradually as a proportion of GDP as the tourism sector recovery picks up in 2025-27.
Primary income deficit to rise
Also, the primary income deficit/GDP ratio will rise in 2023, reflecting rising profit repatriation (especially by gold firms), and fall in 2024. It will then rise again in 2025-27 as repatriation by oil and mining companies increases in line with new projects coming on stream.
Additionally, the secondary income account will continue to post large surpluses, buoyed by inflows of workers' remittances. The deficit will be primarily financed by short-term borrowing.
Latest Stories
-
Medical Laboratory Professionals threaten to strike over conditions of service
2 hours -
Residents of Anloga, Keta express frustration over ECG billing
3 hours -
I don’t believe in praying in tongues – Strongman
3 hours -
‘After The floods’: VRA and GMet clash over cause of Akosombo Dam spillage disaster
3 hours -
‘After The Floods’: Victims suffer harsh conditions 6 months after Akosombo dam disaster
3 hours -
Akufo-Addo to unveil Otumfuo commemorative stamp
4 hours -
EduSpots distributes over 100 tablets and laptops to 30 community-led education spaces
4 hours -
Taxation is driving away investors – FABAG General Secretary
4 hours -
Effutu MP commissions office for Hepatitis B; absorbs cost of testing, vaccination and management
4 hours -
Bawumia pushes for land digitisation to tackle land guard menace
4 hours -
Faith-based institutions are instrumental in national development – Bawumia
5 hours -
Upholding the Integrity of Presidential Promises: A call to Ghanaian leaders
5 hours -
I don’t start ‘beefs’; I only reply – Strongman refutes claims
5 hours -
Vice President Bawumia promises reforms to turn Ghana’s fortunes around
5 hours -
REGSEC warns encroachers along Tema-Sakumono Ramsar site as it races to prevent flooding
5 hours