Cape Town – Ghana was until recently hailed a model for economic growth. One of Africa’s most stable democracies, the gold-rich nation made major strides in increasing income levels and reducing poverty.
However, a debilitating three-year energy crisis slump its once blossoming economy.
Lower rainfall has reduced energy supply since 2013 in a nation that heavily relies on hydroelectric power.
A global commodity slump exacerbated the fiscal downturn even further.
Ghana, the world’s tenth largest gold producer, largely depends on exports of gold, diamonds, aluminium, bauxite and recently discovered oil.
To make matters worse, the first country in sub-Saharan Africa to gain independence was hit by a decline in cocoa prices.
Agriculture, especially cocoa production, accounts for nearly one-quarter of Ghana’s gross domestic product and employs more than half of the workforce, mainly small landholders.
As a result, economic growth shrank from 14 per cent in 2011 to 4.1 per cent in 2015, leading to massive job losses and a sharp rise in taxes, electricity, water and petrol prices.
However, the Ghanaian Cedi currency has lost 60 per cent of its value over the past two years.
Ghana is faced with a growing public deficit and high inflation, which has forced the country of 26 million people to seek an almost 1 billion dollars bailout from the International Monetary Fund (IMF).