Exports and fixed investment are expected to see steady recoveries in 2021 with both contributing 0.8% to real Gross Domestic Product (GDP) growth, the 4th Quarter 2021 Country Report by Fitch Solutions.

“Elevated commodity prices on the back of a strong rebound in global growth will lead to a recovery in profits in Ghana’s key export industries. In particular, gold (36.0% of merchandise exports in 2020) will be an outperformer, and our mining team expects average annual production to rise by 6.0% in 2021,” it stated.

These trends it said will be accompanied by rising business investment in the Ghanaian mining sector by firms such as AngloGold Ashanti, Galiano Gold and Newmont Gold Corporation.

However, exports will fall as a proportion of GDP over the next several years as Ghana's economy becomes less driven by commodity exports, but secondary and tertiary industry sectors develop.

The gold sector will nevertheless continue to drive growth in exports along with oil and cocoa, but rising domestic consumption and large investment flows will reduce the significance of exports in the years to come.

“We expect that imports will decline as a share of GDP over our forecast period, reaching 17.3% in 2030, compared to 35.9% in 2021. Rising consumption of locally manufactured goods and the completion of major infrastructure projects will contribute to reducing imports as a percentage of total GDP in the coming years”, it pointed out.

Other sectors will also see an uptick in investment, facilitated by the easing of Covid-19 restrictions and encouraged by the country’s relatively attractive operating environment.

Ghana scored 45.7 in Fitch Solutions Operational Risk Index, well above the regional average of 35.0. The higher the score the lower the risk.

Automotive firms to make further investments

Also, automotive companies, such as Peugeot, have indicated that they will make further investments in the coming months, while the local construction sector will benefit from ongoing infrastructure development.

For instance, the report said local company GHACEM is investing in additional capacity, including a new cement plant in Ghana’s second city, Kumasi

Gold production falls 12.1% to 4.023m ounces in 2020

The total volume of gold produced in Ghana declined by about 554,000 ounces (12.1%) to 4.023 million ounces in 2020 despite the windfall in gold prices, the 2020 Ghana Chamber of Mines Report stated.

The 12.1% decline in production is the highest year-on-year decline since 2004.

However, Ghana continued to hold on to its position as the largest producer of gold in Africa and the sixth in the world even though the country recorded a decline in output by 12.1%.