Getting your Trinity Audio player ready...
|
Professional services firm Deloitte has cautioned that Ghana’s cocoa production—a key pillar of the country’s economy—could face significant volatility due to multiple challenges.
According to Deloitte’s Global Economic Outlook (January 2025), factors such as climate change, smuggling, and crop diseases—including cacao swollen shoot virus and black pod disease—pose serious risks to cocoa yields. Additionally, fluctuations in global commodity prices further complicate the sector’s stability.
Beyond cocoa, Deloitte has also raised concerns about broader economic challenges facing both Ghana and Nigeria, warning of the impact of high inflation, currency depreciation, rising debt, and restrictive monetary policies on growth in 2025.
The firm stressed that governments in both nations must prioritize these economic hurdles to achieve long-term sustainable growth.
Currency Volatility and Inflationary Pressures
Deloitte noted that West Africa’s economic performance has been constrained by rising inflation and the increased cost of goods and services. This, in turn, has led to higher interest rates as central banks attempt to curb inflation.
**“Nigeria and Ghana have also been facing currency volatility, which has had a severe impact on their ability to import raw materials and equipment required to boost output.
“In the first six months of the year [2024], the Nigerian naira has lost over 40% of its value, and the Ghanaian cedi over 20% of its value against the US dollar.”**
Ghana’s Economic Outlook Remains Positive
Despite these concerns, Deloitte remains optimistic about Ghana’s short- to medium-term economic prospects.
“Ghana, compared to Nigeria, appears to have stronger growth prospects. Its economy grew by 4.7% year on year in the first quarter of 2024, driven by rapid 6.8% year-on-year growth in the industrial sector,” the report highlighted.
While Ghana’s agriculture and services sectors grew at a slower pace of 4.1% and 3.3% year-on-year in 2024, the firm acknowledged that the country is making strides in recovering from its debt crisis.
Debt Restructuring and IMF Support
Deloitte pointed out that Ghana’s ongoing restructuring of its US$30 billion debt has played a key role in stabilizing the economy. Additionally, monetary policy measures implemented by the Bank of Ghana have helped in reducing inflation.
So far, Ghana has received two tranches of IMF disbursements this year, bringing its total financial support from the IMF to US$1.56 billion since 2023.
As the country works towards further economic stabilization, Deloitte’s report underscores the need for continuous policy adjustments to navigate both domestic and global economic challenges effectively.