mid-year economic review by EM Advisory has painted a picture of Ghana’s economy in the first half of the Mahama administration as a “near-perfect turnaround,” but warns that the remarkable progress rests on shaky ground.
The report applauds the country’s macroeconomic achievements: inflation has dropped by 10.1 percentage points, the cedi has surged 42.6% against the US dollar, and GDP grew by 5.3% in the first quarter its fastest pace since 2020. These figures, EM Advisory notes, point to “significant macroeconomic improvement.”
However, the optimism comes with caution. Analysts warn that these gains may be the result of temporary factors rather than deep structural change. A boom in gold exports, rising global gold prices, and central bank intervention are identified as key drivers of the disinflation and currency appreciation. Without lasting reforms, the report warns, the country risks slipping back into the familiar boom-and-bust cycle.
For other frontier emerging markets watching Ghana, the message is clear: a sharp currency rally can boost investor confidence and attract capital, but such quick fixes must be followed by credible reforms to address vulnerabilities like export concentration, import dependence, and fiscal pressures.
On sector performance, agriculture and manufacturing have both recorded strong growth of 6.6%, contributing significantly to GDP. But EM Advisory raises a key question—whether agricultural gains reflect real productivity improvements or are simply the result of favorable conditions this year.
The government’s fiscal discipline also earns praise, with a primary surplus of 1.1% of GDP. Yet, persistent challenges remain. The report points to a GH¢1.3 billion overshoot on the wage bill and inconsistencies in reported arrears, which it says undermine fiscal transparency.
In short, EM Advisory sees Ghana’s recent economic performance as an impressive rebound, but one that will only be sustained if policymakers push beyond short-term wins and tackle the structural weaknesses that continue to threaten long-term stability.
