Deloitte Affirms Ghana’s 4% GDP Growth Rate as Reasonable and Attainable

Deloitte has confirmed that Ghana’s expected real GDP growth of 4.0% in 2024 is reasonable, despite anticipated government spending cuts which may limit program implementations. The firm emphasizes the need for fiscal prudence to address high budget deficits and highlights the importance of energy sector stability for future economic growth and job creation.

Deloitte, a distinguished professional services firm, has assessed that Ghana’s projected real GDP growth of 4.0% for 2024 is both reasonable and attainable. This forecast arises amid a backdrop of the government’s anticipated fiscal tightening and expenditure cuts, which Deloitte posits will likely hinder significant policy and program implementations, resulting in a projected decline in GDP growth in 2025.

In their analysis, Deloitte emphasizes the necessity for the Ghanaian government to address excessive budget deficits, which have averaged approximately 7.5% from 2021 to 2024. High primary balance deficits may exacerbate budget arrears and the national debt, particularly in a landscape of unsustainable debt levels. The projected GDP deficit of 3.1% for 2025 reflects a cautious governmental approach as Ghana navigates the International Monetary Fund’s Economic Credit Facility program.

Despite the forecasts for reduced government spending, Deloitte underscores the criticality of economic growth to alleviate the rising unemployment crisis. They commend the government’s focus on investment in strategic sectors that foster growth and job creation, though they caution about the challenges associated with this balance. Expectations for job creation in 2025 should remain tempered, given that striving for macroeconomic stability is fundamental to achieving sustainable growth.

Furthermore, Deloitte has identified significant debts in the energy sector as a concerning threat to the anticipated economic growth, as industrial growth relies heavily on energy provision. They urge the government to quickly engage relevant stakeholders to devise a strategy to manage these debts, ensuring a reliable power supply essential for economic advancement.

In summary, Deloitte’s analysis indicates that Ghana’s GDP growth forecast of 4.0% for 2024 is both rational and attainable, contingent on careful fiscal management and strategic investments. The challenges posed by high budget deficits and energy sector debts necessitate prompt attention from the government to foster economic stability and mitigate unemployment. Sustainable growth relies on overcoming current fiscal constraints and ensuring reliable energy supply to support industrial expansion.

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