Overview

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Context
Strategy
Results
Partners

Ghana sits on the Atlantic Ocean and borders Togo, Cote d'Ivoire, and Burkina Faso. It has a population of about 29.6 million (2018). In the past two decades, it has taken major strides toward democracy under a multi-party system, with its independent judiciary winning public trust. Ghana consistently ranks in the top three countries in Africa for freedom of speech and press freedom, with strong broadcast media, and radio the medium with the greatest reach. Factors such as these provide Ghana with solid social capital.
Twenty-six months after being elected president in a peaceful election, President Akuffo-Addo has had some successes, but he also faces challenges, fulfilling his election pledges—including setting up a factory in each of the nation’s 216 districts, one dam for every village and providing free high school education. Though the government is implementing some of its promises, such as planting for food and for jobs, and free secondary education.
Recent Economic Developments and Outlook
Recent Developments Ghana’s economy accelerated to 8%1 in 2017, driven by the mining and oil sectors, making it the second-fastest growing African economy, trailing only Ethiopia. In addition to the impact of the oil sector, gold output was high, while cocoa production levels remained stable. In 2018, Ghana’s economy continued to expand rapidly, albeit at a slower pace than the rate in 2017. Quarterly gross domestic product (GDP) growth was estimated at 5.4% in the first quarter of 2018; and 5.4% in the second quarter. The full-year real GDP growth projection was revised from 6.8% to 5.6% due to the larger base for 2017 because of the rebasing exercise conducted in October 2018. This is significantly below the 2017 growth rate of 8.1%.
Ghana’s growth target for 2019 is 7.4% mainly to be driven by the industry sector, especially oil, gas and mining. Industry’s growth is expected to improve to 9.7%; the agriculture sector is expected to grow by 7.3% on the back of the government flagship programs in the sector which will enhance performance in the crops sub-sector. The service sector growth, however, is projected at 6.1%, slightly below the 2018 projection of 6.2% as the financial sector continues to recover from its recent challenges.
Ghana’s fiscal performance has shown a broad turnaround in the past 24 months. The fiscal deficit narrowed to 5.9% of GDP in 2017 from 9.3% in 2016 mostly represented by expenditure measures as revenues remained weak. The government continued with the fiscal consolidation efforts in 2018 despite difficulties on the revenue side. Ghana’s fiscal deficit for the period January-September 2018 was 3% of GDP, just above the target of 2.6%. The primary balance at the end of September 2018 was a surplus of 0.5% of GDP compared to the target of a surplus of 0.9%. The end 2018 data is expected to show a generally lower expenditure as a response to the revenue shortfall and 2018 fiscal deficit is projected to reach 3.7% of GDP.
The inflation rate has stabilized to levels within the central bank’s target range of 6-10%. Headline inflation fell from close to 20% in 2016 to 9.6% in July 2018. This decline was driven by moderations in both food and non-food inflation, the relative stability of the cedi as well as the ongoing fiscal consolidation. The moderation in inflation created room for policy easing since July 2017, as the policy rate was cut from 21.5 in January 2017 to 20% in September 2017 and is at 16% in January 2019.
On the external sector, the current account registered a smaller deficit of 1.4% of GDP in September 2018 compared with 2% a year ago; and Gross International Reserves of $6.8 billion (3.9 months of imports). The current account deficit is expected to continue its narrowing trend and is projected to reach 3.2% of GDP for full year 2018.
Outlook: Ghana’s growth target for 2019 is 7.4% mainly to be driven by the industry sector, especially oil, gas and mining. Manufacturing is also expected to post higher growth. In the medium-term (2019-2022), overall GDP is projected to grow on average at 7.0%, as the effects of oil on growth declines and non-oil growth strengthens. Inflation is expected to remain in the central bank’s target range of 6-10% in 2019, while the fiscal deficit is expected to be marginally higher at 4.2% of GDP.

Last Updated: Mar 25, 2019
The World Bank Group's Country Partnership Strategy (CPS) FY2013-2018 was endorsed by the Bank in September 2013. The CPS' objective is to assist the government to sustain economic growth, accelerate poverty reduction, and enhance shared prosperity in a sustainable manner.
The CPS and the 2018 Systematic Country Diagnostic (SCD) which will inform a new Country Partnership Framework (CPF) beyond FY19, seeks to help Ghana consolidate its transition to the status of a lower-middle-income country, address sources of inequality, improve human capital services and build stronger economic and management institutions and increase agriculture productivity and industrialization. The CPF under preparation is based on three pillars: improved human capital especially in lagging areas; job intensive and sustainable economic growth and more effective and transparent governance and service delivery. In turn, these are anchored in the Ghana Coordinated Program of Economic and Social Policies Agenda, which include economic development, social development, environment, infrastructure and human settlement, as well as governance, corruption and public accountability.
The total WBG exposure is approximately $5.191.5 billion, with a current portfolio of $2.2 billion of credits and grants from the International Development Association (IDA). The current International Development Association portfolio consists of 16 operations for a total commitment of $1,679 billion, in addition to a regional operation with an additional net commitment of $24 million in higher education. Of this, 64.7% has been disbursed with $841.16 million undisbursed. Out of seven pipeline projects scheduled for FY19 delivery, five have been delivered and awaiting effectiveness.

Last Updated: Mar 25, 2019
Through the Land Administration Project, out of a backlog of 62,633 cases of land title applications, 53,479 have been cleared. The number of registered land transactions (deeds and titles) increased from a total of 6,288 in 2011 to a total of 80,109 as of June 2017. As part of decentralizing land administration services to ease congestion, seven Client Services and Access Units have been established, enhancing speedy responses to clients. This has led to significant progress in the reduction of the time it takes to deliver service, thereby reducing the registration of land deeds from three months to two months, and title registration from seven months to four months. An automated Ghana Enterprise Land Information System is being developed to improve efficiency in the provision of land services. As many as 51 Customary Land Secretariats have been established, making a total of 87, and are operational under the management of Traditional Authorities, and more than 40,000 land rights issues were recorded by the end of June 2017. Support to the judiciary has also led to six, additional dedicated Land Courts in Accra, three more regional Land Courts in Sekondi, Kumasi and Tamale, and one sub-regional Land Court to serve the port city of Tema.
Under the Ghana Commercial Agricultural Project’s GCAP’s Matching Grants Scheme, which provides grants to eligible agribusinesses working with outgrowers for land preparation and operating capital, over 6,000 ha of farmland have been developed where crop yields have jumped: rice has gone from a baseline of 1.5 metric tons per ha to 3.8 metric tons per ha in 2017. New irrigation systems and post-harvest warehouses have been built and over 9,300 smallholder farmers (40% women) have been directly supported through nucleus farms to improve their agronomic practices. The project is expected to increase irrigated area by more than 8,000 ha to benefit some 30 medium and large-scale agribusinesses and 14,000 smallholder farmers in target areas.
The Information and Communication Technology sector has been supported by the progressive policies and regulatory interventions of the government, and by the World Bank Group and development partners under the e-Ghana and e-Transform projects. A vibrant private sector bolsters investment and offers innovative products and services to consumers. At the end of December 2018, the total subscriptions of mobile data in the country was 26,184,235 with a penetration rate of 88.84%. %. By December 2018, mobile phone penetration exceeded 100% in Ghana, compared to 1% in 2000, the total number of mobile voice subscriptions was 40,934,875. This represents a percentage increase of 1.19% from November 2018’s figure of 40,454,055. Greater availability of high-speed internet and falling wholesale prices are helping a growing domestic industry of business process outsourcing and information technology-enabled services. The local industry creates jobs for the country’s youth, as well as economic output and export revenue.

Last Updated: Mar 25, 2019
The World Bank country program in Ghana is coordinated with other development partners. The WBG carried out a Performance and Learning Review to assess the progress of the Ghana–WBG Country Partnership Strategy (CPS) for FY13–FY16 that had extended the strategy end date from FY16 to FY18. The review brought together partners in civil society, development, the private sector and government. Similar partnerships were demonstrated during the preparation of the Ghana: Policy Agenda for Growth and Shared Prosperity. Partners reviewed their development plans and revamped the architecture for donor coordination and dialogue to recognize the emerging importance of the private sector and newer, non-traditional partners. The World Bank Group prepared a Systematic Country Diagnostic (SCD) for Ghana, which will inform the new Country Partnership Framework (CPF) currently under preparation. Consultations on the emerging priorities of the SCD took place throughout the country in early March 2018.
Multilateral Investment Guarantee Agency (MIGA) Operations
MIGA currently insures four active projects in Ghana, supporting power, telecoms, clean water, and oil and gas supply, with total active gross exposure of US$455.3 million. MIGA's support is aligned with the first pillar of the CPS, which calls for Job Intensive and Sustainable Growth through engagements in private and financial sector development, the modernization of agriculture, sustainable natural resource management, and investment in infrastructure.
International Finance Corporation (IFC) Country Strategy and Operations
Ghana is IFC’s third largest exposure in Africa in terms of committed investment volume. As of January 2019, it had committed $1,259.5 million of its own account in Ghana. IFC’s current program in Ghana consists of 29 projects, comprising of investments in infrastructure, manufacturing, agribusiness, and services, and financial institutions. IFC’s infrastructure strategy is to support the entire energy value chain from generation to transmission and distribution. It also includes support to port logistics. Through financial intermediaries, IFC provides small and medium enterprises (SMEs) access to credit, as well as by supporting trade finance, capital markets, and financial infrastructure development. IFC also seeks to leverage its investments in the financial sector to support value chains in agribusiness, as well as tourism and commercial real estate.
In advisory services, it has implemented over $41.4 million worth of projects related to trade and competitiveness, financial markets, health, energy, and environmental and social governance. IFC is also committed to improve Ghana’s business environment with dedicated activities focusing on: modernizing the legal framework; facilitating trade at Ghana Port and along corridors, improving government transparency and effectiveness, improving capacity coordination of private sector facing institutions, and strengthening public-private dialogue mechanism.

Last Updated: Mar 25, 2019