Ghana’s economy expanded 7.1 percent last year, led by faster growth in banking and insurance services, while inflation soared as the currency continued to slide.
Banking and insurance surged 23.2 percent, boosting overall growth in services to 8.9 percent, Philomena Nyarko, an official at the Ghana Statistical Service, told reporters today in the capital, Accra.
Inflation accelerated for a seventh month to 14.5 percent in March from 14 percent in the previous month, she said.
Ghana’s economy, the biggest in West Africa after Nigeria, is at risk as the government struggles to contain its budget and current-account deficits, contributing to the currency’s 13 percent plunge against the dollar this year.
Fitch Ratings cut its outlook on Ghana’s debt last month to negative from stable, five months after downgrading the rating by one level to B.
The cedi fell 0.4 percent against the dollar to 2.73 as of 12:25 p.m. in Accra.
Economic growth slowed last year from 8.8 percent in 2012, Nyarko said.
Industry output, which includes manufacturing and oil production, expanded 7 percent in 2013 while agriculture rose 5.2 percent.
An eight-month legal tussle over 2012 presidential results and erratic power supply curbed investor appetite last year, with foreign direct investment declining 18 percent to $3.95 billion, according to the Ghana Investment Promotion Centre.
The economy expanded 4.9 percent in the fourth quarter from a year earlier, Nyarko said. That was the same pace as in the third quarter, which was revised up from 0.3 percent.
Ghana’s central bank tightened monetary policy on April 2 by raising the cash reserve requirement for lenders to 11 percent from 9 percent.
It left the benchmark interest rate unchanged at 18 percent, after boosting it by 200 basis points in February to help bolster the currency and curb inflation.
