Right interventions will spur further growth

A report on Trade Statistics for the second quarter of the year that was launched in Accra last Tuesday revealed that Ghana's economic landscape has witnessed a significant transformation, with the latest figures showing a remarkable turnaround. (See Wednesday September 25, 2024 page 13)

According to the Government Statistician's report, the country has recorded a trade surplus for the third consecutive quarter in 2024, marking a notable shift from the deficit experienced in the same period last year.

This achievement shows the economy's resilience and growth, building on the momentum established in the first quarter of this year.

The first quarter of 2024 saw Ghana's economy exhibit promising signs of expansion, which, all things being equal, sets the stage for continued growth. The trade surplus in the second quarter, totalling GH¢5.4 billion, reinforces this upward trend.

The total trade value for the second quarter reached GH¢123 billion, made up of GH¢64.2 billion in exports and GH¢58.8 billion in imports.

This increase in trade value is something significant that can never be brushed aside, and coupled with the surplus, it underscores the economy's strengthening fundamentals.

The report reveals that gold exports remain the backbone of Ghana's export earnings, accounting for 57.6 per cent of total exports. It is worthy of note that the United Arab Emirates (UAE) has emerged as the leading destination for Ghana's gold exports, surpassing Switzerland, which has for years been the main destination of the precious metal.

The Daily Graphic thinks this development is encouraging, as it shows the diversification of Ghana's export markets and the country’s increasing presence in the global gold trade.

While cocoa beans and products experienced a slight decline in the share of total trade, from 21 per cent to 20 per cent, the sector remains vital to Ghana's economy.

The Daily Graphic would like to see more efforts being put in to enhance cocoa production and quality, as these will be crucial in maintaining the position of cocoa as a significant contributor to Ghana's export earnings.

Inasmuch as we are happy about the continuous growth of the economy and the place of gold in the narrative, we think cocoa holds such importance of place in the economy that we must ensure measures are put in place to reverse its declining contribution to the growth of the economy.

We note from the report as well as previous ones that Ghana's trade dynamics are undergoing a significant shift, with Asia solidifying its position as the country's primary trading partner.

The UAE and China have come tops as key players in Ghana's import and export markets, respectively. We are gladdened because this shift underscores the country's growing ties with emerging markets, and its diversification from traditional European partners.

The Daily Graphic sees the Government Statistician's report as a timely reminder of the economy's potential and vulnerabilities, and to sustain this growth trajectory, we expect policymakers to continuously work at diversifying the country’s export base by putting in practical measures to encourage the growth of other export-oriented sectors, to reduce our dependence on gold and cocoa.

The report is a vindication that the country would better enhance its trade relationships when it fosters stronger ties with emerging markets, particularly in Asia.

It is an understatement to say that infrastructure development is a sine qua non for economic growth and development. We have no choice as a country but to ensure that we develop critical infrastructure to facilitate trade and commerce to contribute to productivity and economic performance, especially if they have high benefit-cost ratios.

Infrastructure investments are also essential for the functioning of the economy and contribute to business efficiency, connectivity and business growth.

Again, investing in infrastructure has a real impact on creating and sustaining jobs. The most recent estimates by the US President’s Council of Economic Advisors note that every US$1 billion in Federal highway and transit investment funding supports 13,000 jobs for one year.

In addition, we urge the government to monitor price fluctuations closely and track changes to ensure stability in the trade sector.

With a milestone of a third consecutive trade surplus, we call for strategic policy interventions, diversification of efforts and continued investment in critical sectors to build on this momentum for further positive growth.