Ghana experiences 6.3% reduction in primary deficit – World Bank

The World Bank says Ghana and some African countries have experienced important reduction in their primary deficits. “Ghana, the Central African Republic, and Cabo Verde experienced an important reduction in their primary deficits. The primary deficit in Ghana was cut from 6.7 per cent of GDP in 2010–13 to 0.4 per cent in 2015–16, that is, a reduction of 6.3 percentage points of GDP. The primary balance of the Central African Republic shifted from a deficit of 1.8 per cent of GDP in 2010–13 to a surplus of 1.1 per cent in 2015–16,” it said.

In its Africa’s Pulse report analyzing the economy of the continent, it also noted that among oil producers in Africa, growth is forecast to strengthen in Ghana, as increased oil and gas production boosts export.

The report indicates that in most countries in the Africa region (36 of 44), the public debt burden increased in 2015–16 compared with 2010–13 . The median increase in general government gross debt was about 14.9 percentage points.

“The largest increases from 2010–13 to 2015–16 were in Mozambique (from 44 to 102 per cent of GDP), Cabo Verde (from 86 to 131 per cent of GDP), and The Gambia (from 77 to 113 per cent of GDP),” it said, adding that, “other notable countries with high public debt burdens are Mauritania (99 per cent of GDP in 2015–16) and Ghana (72 per cent of GDP in 2015–16).

According to the report, the public debt burden increased in Ghana despite improvements in the primary surplus. This, it pointed out, reflects the substantial size of interest payments.

“In contrast, Sudan, Guinea, and the Comoros experienced a decline in the general government gross debt that exceeded 10 percentage points of GDP—specifically, 14, 10, and 14 percentage points of GDP, respectively. However, their average levels of public debt in 2015–16 were very different—with the Comoros at 26 per cent of GDP, Guinea at 55 per cent, and Sudan at 69 per cent,” it said.

The report said economic growth in sub-Saharan Africa is recovering at a modest pace, and is projected to pick up to 2.4 per cent in 2017 from 1.3 per cent in 2016.

It also noted that on average, across countries insub-Saharan Africa, eight of every 10 jobs is in agriculture or nonfarm household enterprises, most often in services.

“In some countries, such as South Africa and progressively in others, including The Gambia and Ghana, manufacturing and services are more important sources of jobs. However, the movement of labor out of agriculture in most of sub-Saharan Africa has been slower than in the rest of the world, and projections show that even in optimistic scenarios, the share of nonwage informal employment is likely to change very slowly,” it said.

By Emmanuel K. Dogbevi
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