International newswire, Reuters is reporting that Ghana’s economy actually declined for the first time in almost four decades by some 3.2%.
According to Reuters, the global Covid-19 Outbreak could partly be responsible for the economic mess.
“Even after the restrictions have been lifted, many businesses across sectors have continued to close down,” government statistician Samuel Kobina Annim told a news conference.
“For the first time in 37 years, Ghana’s economy has seen a contraction of 3.2%, compared with a growth rate of 5.7% in the same quarter in 2019.”
The fall in output was mostly felt in manufacturing and in the services sector, where hotels and restaurants were shuttered to stop the virus spreading.
Ghana’s finance minister has said in July that the economy was expected to grow at its slowest rate in 40 years, at around 0.9% this year compared with a previous forecast of 6.8%.
The verdict on Ghana’s latest economic forecast is coming barely a day after the global rating agency, Standards and Poors’ (S&P) downgraded Ghana’s creditworthiness to one of the lowest in recent history.
S&P dropped the country’s credit ratings to B Negative, making the country vulnerable to shunning from foreign investors who would regard the potential of them gaining any better returns on their investments as extremely high risk.
Incidentally, the Akufo Addo administration appear unperturbed as it keeps guzzling public debt and has increased its appetite for more loans despite its bad credit position.
One of the latest questionable attempts at securing foreign funds is through the questionable Agyapa Royalties deal.
The deal intends to provide Ghana some US$ 500 loans routed through a notorious tax haven in Jersey on the British Channel Islands, in what has created a massive outrage in Ghana and has earned the President and his lieutenants the derogatory tag as “Akyem Sakawa Boys”.
Policy think-tank, ASEPA had earlier warned that the Agyapa deal could attract a bad credit rap to Ghana.
The Finance Ministry also recently hinted at borrowing a staggering GHC 22.7 billion within the next three months through domestic bonds in what the government rationalises as a result of its fiscal challenges.
Even amidst the so-called fiscal challenges amidst Covid-19, the Akufo Addo administration is being accused of reckless expenditure and lack of transparency in how these public funds are expended.