Economic outlook and economic policy developments 

Ghana’s economic growth in 2023 was revised down to 2.9% [3.8% in 2022, 5.1% in 2021] and is expected to remain subdued throughout 2024. For growth to reach its actual potential, estimated at 5%, attaining macro-economic stability is paramount. Growth in 2023 was driven by the service sector, which remained the largest contributor to GDP with 45.6%, followed by industry at 31,7% [33.6 in 2022] and agriculture at 22.7% [20.8% in 2023]. The contribution of industry to the GPD thus shrank by almost 2% in 2023 and by a concerning -2.9% if gold is taken out of the calculations. The nominal GDP for 2023 is estimated at USD 76,37 billion [74,6 billion in 2022; 79.5 in 2021]. This is also a result of high gold prices in 2023. The additional GDP from the significant informal sector is estimated at an impressive (untaxed) USD 51 billion in 2023 by Ghana Statistical Service.

The national currency, the Ghana Cedi, weakened again in the first half of 2024, losing another 14% against the main trading currencies. The national daily minimum wage adapted to GHS 14.88 in 2022 was not lifted since. The value of the Cedi was USD 1 = GHS 8.8 in August 2022 and is now again as low as 16 to 1 dollar, which is a similar level than in the crisis month of October 2022, when the Cedi was the worst performing currency worldwide. Exchange rate instability and depreciation is increasingly plaguing the businesses in Ghana. Uncertainties in the financial sector relaxed somewhat after a painful domestic debt restructuring, but are now building up again quite rapidly, with NPL rates reaching crisis levels.

The obstruction of established trade routes to and from Russia as well as Ukraine could be partially mended and promising first developments are observed in the area of inter-African trade, where Ghana participates in the Guided Trade Initiative of the African Continental Free Trade Area. Import substitution is slow, as necessary funding for investments is unavailable or not affordable.

Ghana’s sovereign risk rating remains negative, as it struggles to restructure external debts with bilateral and commercial creditors. Regarding the debt restructuring with the external bilateral creditors, Ghana signed the MoU under the G-20 common framework in June 2024, paving the way for an effective debt restructuring. The negotiations with the external commercial creditors are however slow and less structured.

The largest expenditure items of the government in 2023 were the compensation of public employees (about 688,000 public sector employees alone absorbing 52.78% of the 2023 tax revenues1), while interest payments for public debts were put on hold with very few exemptions. This allowed the Bank of Ghana to build up some modest reserves in 2023. These are currently again under pressure due to the weakening Cedi. The country finds itself under a USD 3 billion program by the IMF, first tranches of the World Bank policy lending operations (a total of USD 1.5 billion pledged) and grant schemes of the African Development Bank. Ghana remains a large remittance recipient in Sub-Saharan Africa, ranking second on the African continent in 2023, recording an influx of USD 4.9 billion, which is 5.6% more than in 2022.

Host country’s policies and priorities

With the overall aim to sustain peace and stability in the West African sub-region, Ghana actively pursues continental and regional integration through AfCFTA, AU and ECOWAS respectively. ECOWAS however took a hit, when Niger, Mail and Burkina Faso submitted their requests in 2024 to leave the economic community by January 2025. Ghana is a committed member to the African Union, where it plays a leading role in the collective efforts to promote peace, stability and economic development on the continent.

Among the goals of Ghana’s foreign diplomacy are i) to attract foreign direct investments ii) create political goodwill and iii) increase international solidarity. A more specific goal of Ghana’s Economic Diplomacy is to diversify and increase Ghana’s export base. Domestically, however, short-sighted measures to increase revenue through aggressive tax practices damage the business environment and increase the cost of doing business. Reforms are currently neither coordinated nor comprehensive, and there is no real public-private dialogue that would allow to prioritize and align business-friendly reforms.

Outlook for Switzerland (potential for discrimination or comparative advantage)

Ghana is generally interested in strengthening the economic ties with Switzerland and regularly expresses the wish for more investments. This wish is especially directed towards the productive industries, namely labor intense agro-processing, where Switzerland has a high standing. At the same time, government representatives are well aware of obstacles restricting foreign investments, such as the lack of reliable and reasonably priced energy, expensive commercial credits, insufficient and dilapidating physical infrastructure, weak land ownership rules, clogged courts, widespread corruption and lack of legal enforcement. In its rhetoric, the government intends to tackle these obstacles, but in reality, neither scope nor speed of concrete comprehensive reforms are congruent with high-level declarations of reforms.

Ghana’s goal of strengthening local processing rather than exporting raw materials could be a good opportunity to increase production capacity on site. Promising value chains apart from extractive and agricultural commodities could be found in the recycling industry, where secondary materials have proven to increase the resilience of value-chains. Clear new potential can be observed in the area of renewable energy, ranging from solar, wind and biogas to battery storage. There is also increasing traction in IT and AI related services, both for domestic use and export, as well as for quality infrastructure and precision instruments. Textile production is also slowly on the rise, currently geared towards the US market, as there is a favorable preferential program in place, AGOA (African Growth and Opportunity Act), that allows for tax free import of thousands of products including textile.

Developments and general outlook

Trade in goods

Gold, crude oil and cocoa beans remained the top export commodities of Ghana, followed by food-products, out of which 65% is however again based on cocoa. The country also retained its position as the leading gold producer in Africa in 2023, followed by South Africa, Sudan, Mali and Burkina Faso. The gold output reached more than 100 metric tons in 2023 and was thus comparable to 2022. Gold continues to account for around 43% of Ghana’s total exports, with Switzerland purchasing a larger share (44%) than any other country: in 2023, Switzerland bought 62.5 tons of gold worth CHF 2.996 from Ghana, which is comparable to the 65 tons worth CHF 3.1 billion in 2022.

In early 2023, Ghana introduced a highly controversial “oil for gold” scheme, which allowed to purchase (Russian) refined oil in exchange for gold, thus reducing in-country demand for foreign exchange and increasing the availability of fuel considerably. Mineral fuels and oil exports are geared towards the US, gold towards Europe, Asia and Africa, while cocoa beans continue to predominantly go to the Netherlands, followed – to a much lower extent – by USA and Asia. Overall, Ghana displayed a thinly positive trade balance in 20233 , a surprising deviation from its historical trade deficit, by recording export proceedings in the amount of USD 21.7 billion while importing goods in the amount of USD 21.1 billion. Ghana however continues to face challenges in diversifying its export markets and still heavily relies on imports. The country’s export profile remains heavily reliant on primary products.

Ghana retained its position as the world’s second-largest cocoa producer after Ivory Coast (1’800’000 mt), but the gap between the two is widening, and their combined production is reducing altogether. Ghana produced about 580’000 metric tons in 2023, compared to 654,000 metric tons of cocoa beans in 2022, which already was considerably less than in 2021 (683’000) and nowhere near the previous harvest (2020: 1’047’000 mt). The only country currently increasing cocoa production is Ecuador, and some cocoa millers openly discuss shifting production from West Africa to South America.

Aside from gold and oil, other export products of Ghana include (raw) cashew, timber, bauxite and manganese. Of the considerable share of exported food products, the largest portion (65%) represents semi-processes cocoa products, followed by dried and fresh fruit. On the import side, Ghana’s top imports include motor vehicles for the transport of persons and goods, vehicle parts, iron and steel, plastics, rice, cereal grains, cement as well as chemical and pharmaceutical products. Although a producer of palm oil, Ghana remains a net importer of this particular commodity.

Developments and general outlook

According to the 2024 UNCTAD World Investment Report, total FDI flow to Ghana in 2023 was USD 1.35 billion, which is a 10.4% decline compared to that of 2022 (USD 1.5 billion). Meanwhile, during the same period, the total investment stock saw a slight rise of 2.9% (from USD 46 billion in 2022 to USD 47 billion in 2023). The value of announced greenfield projects increased significantly by about 92.3% from USD 1.3 billion in 2022 to USD 2.56 billion in 2023, which is the result of a large announced lithium mining project.

However, no international cross border nor any acquisition deal materialized in 2022 and 2023. Domestic sources present an even darker picture: the Ghana Investment Promotion Centre’s (GIPC) 4 th Quarter 2023 Report recorded approximately USD 649.59 million of FDI in 2023 (USD 1.35 billion in 2022 and USD 1.29 billion in 2021), representing a significant decline of 51.92% over that of 2022. Meanwhile, the local share of the total investment for 2023 also declined significantly by about 94.7% (from USD 260.98 million to USD 13.6 million).

In terms of the FDI sectoral values, the manufacturing sector recorded the largest FDI value of USD 280.24 million followed by the services and general trade sectors with USD 226.29 million and USD 75.17 million respectively6 , according to the same domestic report.

In April 2023, Fitch last rated Ghana as RD (restrictive default), which roughly translates to “default with little prospect for recovery”. This is a negative signal for private investments and invites speculators to bet against the local currency.