US commits $7b to African energy sector

The United States is committing more than US$7billion in financial support over the next five years to African countries, including Ghana, to directly address constraints in electric power generation and help pave the way for energy sector reforms.

The investment support under the “Power Africa” initiative is US President Barack Obama’s new plan to double access to power in sub-Saharan Africa through bringing to bear a wide range of US government tools to shore-up investment in Africa’s energy sector.

Inflation rate in Ghana

Inflation in Ghana

The inflation rate in Ghana was recorded at 11.50 percent in August of 2013. Inflation Rate in Ghana is reported by the Ghana Statistical Service. From 1998 until 2013, Ghana Inflation Rate averaged 17.3 Percent reaching an all-time high of 63.0 Percent in March of 2001 and a record low of 0.4 Percent in May of 1999. In Ghana, the most important components in the Consumer Price Index (CPI) are Food and Non Alcoholic Beverages (43.6 percent of total weight); Housing, Water, Electricity, Gas and Other Utilities (9.5 percent) and Clothing and Footwear (8.9 percent). Transport account for 7.2 percent of total index, Miscellaneous Goods and Services for 7 percent, Hotels, Cafés and Restaurants for 6 percent and Furnishing and Household Equipment for 4.6 percent. Education represents 3.8 percent of total weight, Recreation and Culture another 2.7 percent and Communication 2.6

Overview: The Economy of Ghana

The Republic of Ghana lies in West Africa, on the Gulf of Guinea.It is bordered by Cote d'Ivoire to the west, Togo to the east, and Burkina Faso to the north.  The population of Ghana is approximately 25 million, with approximately 50.9 percent of the population living in urban areas.  Accra, the capital of Ghana and its largest city, has an estimated population of over 1.8 million.

After prolonged periods of instability, Ghana has recently been one of the most stable democracies in Africa with democratically elected governments since 1992.  The most recent presidential and parliamentary elections were held on 7 December 2012, which resulted in the election of incumbent president, John Dramani Mahama of the National Democratic Congress.

The next presidential and parliamentary elections are scheduled to be held in December 2016.  On 6 March 2013, Ghana commemorated the 56th anniversary of its independence from British colonial rule.

The Economy 

The Ghanaian economy is in its twelfth consecutive year of expansion, combining improvements in macroeconomic management and strong export growth, notwithstanding on-going power shortages and high global oil prices.  Ghana’s overall economic growth and relatively stable macroeconomic environment facilitated its upgrade to a lower middle-income economy in late 2010. 

The economy continues to expand in key sectors, including oil production in commercial quantities, high commodity prices including cocoa, gold and oil, increased exports volumes and steady remittance flows.  Important economic indicators reveal an overall increase in macroeconomic stability:

Gross Domestic Product

Real gross domestic product (“GDP”) grew by 7.9 per cent in 2012, compared to 15 per cent in 2011 and 8 per cent in 2010.  The decrease has mainly been driven by the fact that the 2011 GDP figure, reflected revenues from oil production. It also reflects a rising deficit due to an increase in public sector wages and costly energy subsidies. Historically, Ghana’s economy has relied heavily on gold production and agriculture, particularly production of cocoa, as the primary drivers of GDP growth.  Since the Republic began producing oil in 2010, it has become an additional driver of GDP growth.