Nation booms on oil, and diversifies into renewable energy, textiles and electronics
According to the central bank, Ghana’s oil production leapt to nearly 60 million barrels in 2017, resulting in export revenues 124 per cent above the previous year
Ghana could have one of the world’s fastest-growing economies in 2018, according to institutions such as the World Bank, the African Development Bank, the International Monetary Fund (IMF), and the Brookings Institution.
Financial authorities have also concluded that Ghana’s 2018 growth, projected at 8.6 per cent, might outpace that of tech-led India and also Ethiopia, which since 2008 has been one of Africa’s most successful economies, thanks to improved agricultural production and substantial coffee exports. According to an IMF expert, only tiny Bhutan and post-civil war Libya are expected to see a higher rate of growth.
Last January, Bloomberg reported that Ghana’s benchmark stock index achieved the world’s highest rate of growth, an astonishing 19 per cent.
As oil prices have increased, the nation has also boosted its production, helped by two new major offshore oilfields over the past two years. According to the central bank, Ghana’s oil production leapt to nearly 60 million barrels in 2017, resulting in export revenues 124 per cent above the previous year.
Ghana enjoys an enviable location on the Atlantic Ocean, bordering Togo, Ivory Coast and Burkina Faso. Its population of just under 30 million has seen the government strengthen in the past two decades as it flourished under a multi-party system, with the independent judiciary winning a high degree of public trust.
When it comes to freedom of speech and press freedom, Ghana consistently ranks in the top three countries in Africa, with a strong broadcast culture that favours radio, although the internet is fast gaining in popularity.
In the months since he was elected, President Nana Akufo-Addo has made steady progress in fulfilling his election pledges, including setting up a factory in each of the nation’s 216 districts; building one dam for every village and providing free high school education.
Other projects include wide-scale planting that will provide both food and jobs.
Cocoa is Ghana’s other great resource, and farmers are riding on the oil boom with alacrity. Other Ghanaian industries are performing creditably. The country’s industrial base is relatively advanced and import-substitution industries include electronics manufacturing.
RLG Communications was one of the first indigenous African companies to assemble laptops, desktops and mobile phones, and ranks among the largest West African information and communications technology companies.
Ghana’s automotive manufacturing is bolstered by investment from the Indian firm Mahindra while the textile industry is championed by a long-running quartet, namely Akosombo Textiles, Tex Styles Ghana, Printex Ghana and the Ghana Textile Manufacturing Company.
Ghana also has an eye on the future of renewable energy, with a number a farsighted projects aimed at lessening its dependence on fossil fuels and taking advantage of Africa’s natural bounty.
The nation was one of the first in the region to initiate the construction of solar plants with the aim of getting 6 per cent of its energy from solar generation.
As one of the biggest photovoltaic (PV) and largest solar energy plants in Africa, the Nzema solar power project has the potential to provide electricity to more than 100,000 homes.
Unlike many other solar projects that use concentrated solar power, the solar plant’s PV technology converts sunlight directly into electricity.
The installation of more than 630,000 solar PV modules started in 2013, with the first electricity being generated early in 2014. Similar projects are under consideration in other parts of the country. In a similar vein, the government is capitalising on the potential of wind energy. Ghana has high-wind locations, such as Nkwanta, the Accra Plains, and the Kwahu and Gambaga mountains, and the maximum energy that could be tapped from Ghana’s available wind resource for electricity has been estimated to be about 500-600 GWh/year.
One of the first wind energy projects is due to go into operation next year – the 50MW Ada station, which is being built in the Greater Accra region at a cost of US$120 million. Developed by global energy company Engie together with South Africa’s eleQtra, Ada station will contribute to the Ghanaian government’s objective of generating 10 per cent of its electricity from renewable resources.
The project is also in line with Ghana’s ambition to become a regional power generation hub and export power to its neighbours in the West African Power Pool. Finally, Ghana is aiming to attract investment to its biomass and bio-energy sectors, which should stimulate rural development, create jobs and preserve foreign exchange.
Ghana’s vast arable land mass could be used to cultivate crops and plants that could be converted to solid and liquid bio-fuels, as the development of alternative transport fuels could assist the nation to diversify and secure its future energy supplies.
The main opportunities in the sector exist in areas such as transport, storage, distribution, sales, marketing and export.