Following the higher-than-projected Gross Domestic Product (GDP) figures announced by the Ghana Statistical Service (GSS), key economic indicators which are expressed as a ratio of GDP will be adjusted accordingly, the Ministry of Finance has announced.

The Statistical Service, in its provisional 2021 fourth quarter and overall 2021 annual GDP data, which was released on April 20, 2022, showed that real GDP recorded a 7 percent appreciation in the final quarter of 2021.

This is against the 4.3 percent growth seen in the similar period of 2020, with non-oil real GDP in the fourth quarter of 2021, rising by 7.6 percent compared to 5.7 percent for the same period in 2020.

Consequently, the Ministry of Finance, in a communiqué, said the nation’s debt-to-GDP ratio has been revised downward from 80.1 percent to 76.6 percent for 2021. For 2020, the stock has also been amended from 76.1 percent to 74.4 percent, a development the fiscal authority says is further confirmation that the rate of debt accumulation has slowed to pre-pandemic levels.

Similarly, the fiscal deficit – including energy and financial sector payments – has seen a marginal drop to 11.4 percent from 11.7 percent in 2021. In 2020, however, this ratio declined from 15 percent to 14.7 percent, the ministry indicated.

Consequently, the ministry announced that it will update its debt sustainability analysis (DSA) and revise its projections for the 2022 fiscal year and the medium term to reflect the 2021 results as well as recent debt-sustainability and fiscal responsibility policy initiatives.

“These developments are positive and confirm the fact that the economy is rebounding COVID-19 era, the rate of debt is tapering off, and there is a fiscal expansion with Ghana on track to return to the Fiscal Responsibility Act threshold of 5 percent of GDP by 2024,” the ministry said in the statement.

Growth figures

The GSS indicated that on an annual basis, the provisional real GDP growth for 2021 outpaced the revised projected figure of 4.4 percent for 2021 by 1 percentage point, as it ended the year at 5.4 percent and was 0.9 percentage points higher than the Sub-Saharan African (SSA) average, ensuring that only 10 countries on the continent performed better.

Per the GSS data, the nominal GDP for 2021 was estimated at GH¢459.1billion, over GH¢18billion more than the projected outturn of GH¢440.8billion for the period, up from GH¢391.9billion recorded in 2020.

The non-oil nominal GDP for 2021 is GH¢437.9billion, up from GH¢378.1billion in 2020. Also, non-oil real GDP expanded from 1 percent in 2020 to 6.9 percent in 2021, exceeding the target of 5.9 percent for the period.