Ghana’s economic growth is projected to remain modest in 2025, with the World Bank forecasting a Gross Domestic Product (GDP) growth rate of 3.9%, slightly below the government’s more optimistic estimate of 4.4%. This tempered outlook underscores the ongoing challenges the country faces as it seeks to stabilize its economy amidst persistent inflationary pressures and external shocks.
The World Bank’s April 2025 Africa Pulse Report highlights a slightly improved trajectory for Ghana’s economy in the coming years, predicting GDP growth rates of 4.6% in 2026 and 4.8% in 2027. While these figures reflect a gradual recovery, they also point to the need for stronger policy measures to address structural vulnerabilities and external risks.
Challenges for Ghana and the Region
The report draws attention to the adverse effects of unpredictable weather patterns on key sectors like cocoa production—a critical export for Ghana and neighboring Côte d’Ivoire. These erratic conditions, including droughts and floods, have not only reduced harvest yields but also disrupted global stockpiles, further straining the country’s economic resilience.
Across Sub-Saharan Africa, governments have been forced to reallocate as much as 9% of their budgets to respond to extreme weather events, resulting in economic losses of 2–5% annually. Such pressures continue to weigh heavily on resource-dependent economies like Ghana, making it imperative to adopt innovative strategies for climate adaptation and economic diversification.
Signs of Recovery in 2025
Despite these challenges, the report notes encouraging signs of recovery in Ghana’s business environment. Business sentiment rebounded significantly in early 2025, with the Purchasing Managers Index (PMI) rising from 47.9 in January to 50.6 in March. This growth reflects increased demand, easing supply chain disruptions, and a resurgence of new business activities following the December 2024 presidential elections.
The report also observes improved activity in manufacturing and services sectors, not only in Ghana but across several African countries. While business confidence remains robust in Kenya, Nigeria, and Zambia, Ghana and Mozambique have shown notable recoveries after periods of contraction.
Regional Growth Outlook
Sub-Saharan Africa is projected to experience a slight economic uptick, with growth rising from 3.3% in 2024 to 3.5% in 2025 and further accelerating to 4.3% by 2026–27. However, the region’s overall performance remains hampered by sluggish growth in its largest economies—Angola, Nigeria, and South Africa.
Excluding these three countries, the rest of the continent is expected to grow at a faster pace, reaching 4.6% in 2025 and 5.7% in 2026–27. This promising outlook is contingent on mitigating global policy uncertainties and addressing domestic structural challenges.
Path Forward for Ghana
For Ghana, these projections emphasize the importance of sustaining fiscal discipline, enhancing investment in key sectors, and addressing inflationary pressures. As the country navigates these economic headwinds, the World Bank’s report provides a roadmap for fostering resilience and laying the foundation for inclusive growth.
While the path to recovery remains uncertain, the signs of improvement in Ghana’s business environment and the broader African economic landscape offer a glimmer of hope for a brighter future.
Story by: Mercy Addai Turkson #ahotoronline.com
