Ghana’s Economy Getting Back On Track – BoG
Emerging Bank of Ghana (BoG) data indicates that the economy is on its way to recovery after the Covid-19 setbacks, the First Deputy Governor of BoG, Dr. Maxwell Opoku-Afari, has revealed.
According to him, the Composite Index of Economic Activity (CIEA) of the central bank shows significant recovery in the third quarter despite a contraction in economic activities in the second quarter of this year.
Providing an update on the economy on Accra-based ‘Mx24 TV’, Dr. Opoku-Afari said, “What we have seen at the central bank and one of the advantages we have is to have access to what we call High Frequency Leading Indicators. Putting all those High Frequency Leading Indicators together, we have been able to put together what we call Composite Index of Economic Activity which helps us track short-term dynamics in economic activities and gives us a sense of where economic activity is going to.
“Even though we saw a contraction in the second quarter, the data that we are picking from the Composite Index Economic Activity and High Frequency data, including credit to private sector, manufacturing, sales and a few other things, shows that we are beginning to see some significant recovery already in the first few months of the third quarter up to September and in fact throughout the third quarter,” he noted.
The Deputy Governor was optimistic, saying “this recovery is quite significant to the extent that we think that growth will be positive in the third quarter. If you put it that way, then the leading indicators are pointing to what we will call a V-shaped recovery because of the significant negative impact we expected as a result of the lockdown as we expected the restrictions to be prolonged but we saw that there was a gradual lifting of those restrictions.”
He explained further that “this meant the impact on economic activities had not been as severe even though it is a contraction because -3.2% is not a small contraction but to have a turnaround in the third quarter shows that the recovery is going to be more of a V-shape than a U or a trapezoid.”