Economic overview
Ghana’s economy, the biggest in West Africa after Nigeria, has benefited from two decades of political and economic stability; discovery and extraction of natural resources; and a competitive business environment. Estimated oil reserves have jumped to almost 700 million barrels. Economic growth outpaced the average for the Africa region in recent years. Gross domestic product growth rose to 15% in 2011 on strong cocoa production, increased gold output and the commercialization of oil. But Ghana’s economy grew just 7.1% in 2013 and is under pressure because of growing debt, increasing inflation and a drop in foreign investment. Ghana’s currency has dropped 13% against the U.S. dollar this year.
Business travel industry insight
New hotels have spread across Ghana in recent years, including high-end properties. But five stars in Ghana may not provide the same amenities as in hotels elsewhere. Theft and fraud—especially credit card fraud—are common; travelers should use cards with caution, even in established hotels. Use ATMs or convert travelers’ checks for cash, but beware of money-changers on the street who may provide counterfeit bills. Business travelers may need a visa to enter Ghana, as well as evidence of yellow fever vaccination. Finally, travelers should be prepared for occasional power outages and use a surge protector to safeguard electronics.
Opportunities
- Industry output, which includes manufacturing and oil production, expanded 7% in 2013, while agriculture rose 5.2%. (Agriculture accounts for about a quarter of GDP and employs more than half of the workforce.)
- Ghana’s growing oil industry is expected to boost the economy, even as the country faces deficits and currency devaluation.
- Government officials report that banking and insurance surged 23.2% last, boosting overall growth in services to 8.9%. The services sector accounts for about half of GDP.
- The country demonstrates healthy democratic governance, including a multi-party political system, as well as a diverse press.
Challenges
- Foreign direct investment fell 18% last year, in part because an extended legal battle over the 2012 presidential results worried investors.
- Inflation has accelerated for several months and now sits near 14.5%.
- Ghanaians have begun protesting their living standards; there is a popular perception that citizens are not fully reaping the benefits of the country’s oil production.
- Fitch Ratings recently cut its outlook on Ghana’s debt to negative from stable, just a few months after a previous downgrade.
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