Long-Run Growth in Ghana : Determinants and Prospects

Herrera, Santiago ; Aykut, Dilek

World Bank Group, Washington, DC

关键词: growth strategy;    oil production;    natural resources;    Economic growth;   

DOI  :  10.1596/1813-9450-7115
RP-ID  :  WPS7115

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Ghana's economic growth picked upin the early 2000s and has been exceptionally strong overthe past few years, with price booms of its main commodityexports, gold and cocoa, and the initiation of commercialoil production in 2011. This paper examines recenteconometric evidence on Ghana's long-term growth andevaluates its sustainability. The empirical evidencesurveyed finds that Ghana's main growth drivers wereinvestment, oil, and mineral rents, while governmentconsumption acted as a growth retardant. Based on variousscenarios for its determinants, per capita GDP growth ratesare predicted to be between 3.5 and 4.5 percent for 2014-34.Nevertheless, the predictions are subject to considerableuncertainty associated with the expected trends andvolatility of the drivers of growth, particularly tosustaining investment levels and external factors such ascommodity prices and international capital flows. A growthdecomposition exercise shows that Ghana's past growthwas led by capital accumulation, which will be difficult tosustain given the high current account deficits and thevolatility of capital flows. Hence, a switch toward aproductivity-based growth strategy, instead of theinvestment-led growth strategy of the past, is the onlyviable alternative to sustain the recent high growth rates.For that, Ghana needs focus on policies that enhancegovernment effectiveness and public spending efficiency. Tomitigate the risk of falling into the so-called growth trapslike many other countries, Ghana must resolve itsmacroeconomic imbalances and resume the institutional reformto enhance the quality of institutions and make growth more inclusive.