Ghana is widely regarded as a rapidly maturing African democracy, with peaceful elections and transitions of power since the multi-party system was introduced in 1992. Ghana's abundant natural resources are a blessing in times of elevated commodity prices, and there is scope to ramp up output further. Multilateral debt relief has reduced Ghana's external liabilities significantly, freeing up former debt servicing funds for pro-poor spending and greater developmental efforts.

We keep our clients informed of the latest market moves and political developments in Ghana, as part of our 'top-down' and 'bottom-up' perspective. Clients also benefit from in-depth analysis on 14 of Ghana’s most important industries. We provide interactive data and forecasting alongside detailed and risk-assessed analysis from our expert research teams. Our aim is to keep you ahead of the curve, so you can operate with confidence in Ghana.

Country Risk

Ghana Country Risk

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Core Views:

  • Ghana will record real GDP growth of 3.4% in 2015, the slowest rate of expansion in over a decade. The country is struggling with a number of growth impediments, not least a protracted electricity crisis, a yawning fiscal deficit, a weak currency and negative investor sentiment.

  • The Ghanaian current account deficit will remain wide in 2015 and 2016, and this, combined with weak investment inflows, will continue to exert depreciatory pressure on the Ghanaian cedi. We forecast that the current account deficit will be equivalent to 8.2% of GDP this year and 7.7% in 2016, from 9.4% in 2014.

  • The Bank of Ghana (BoG) will maintain its key policy rate at 22.0% through the remainder of 2015. Although inflation will slow as the massive appreciation of the cedi in July feeds through, it is still far above the bank's target level,...

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Ghana Operational Risk Coverage (9)

Ghana Operational Risk

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BMI View: The operating environment is safer for businesses in Ghana than in most West African countries, with fewer incidences of violent assault, but investors remain exposed to risks associated with widespread money laundering activities, a growing number of cyber attacks and high levels of petty crime. Ghana has stable relations with its neighbours but the lack of cooperation to combat piracy and organised crime means that criminal groups originating from other countries such as Nigeria are able to reach Ghana's shores. As a result, Ghana receives an overall score of 41.8 out of 100 for Crime and Security, below the global average but ranking in 13 thposition out of 48 states in Sub-Saharan Africa.

The greatest risk investors in Ghana face is from crimes that target business operations, as financial and organised crime are...

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Ghana Crime & Security

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BMI View: Ghana is a relatively stable country and risks emanating from crime and security are low for investors in comparison with its West African neighbours. Nonetheless, crime levels in Ghana warrant a degree of vigilance when operating in the country, with foreign workers particularly targeted. The threat of piracy in the region is heightened by a lack of coordination with neighbouring authorities. Due to these considerations, we score the country 48.7 out of 100 for its overall Crime and Security risk. This score places the country 10 thwithin Sub-Saharan Africa and 100 thglobally out of 201 countries covered in BMI Index.

Expatriates and tourists are frequently the victims of non-...

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Ghana Labour Market

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BMI View: Ghana's labour market is attractive compared to other Sub-Saharan African countries, high levels of urbanisation, a large migrant worker community and flexible employment conditions. The country offers limited labour market risks from a regional perspective but poor access to its underfunded education system along with low life expectancy reduces the size of the skilled labour pool considerably. In addition to employer absenteeism, businesses operating in Ghana face high severance pay costs. Overall, Ghana's score of 51.1 out of 100 ranks the country in first place out of 48 countries in Sub-Saharan...

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Ghana Logistics

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Ghana's abundance of natural resources and newfound oil wealth has attracted high levels of foreign direct investment flows to the country, but the dilapidated state of its roads, insufficient water network and frequent power shortages means that investors face a tough operating environment and will have to factor in higher start-up costs if they are seeking to expand into this market. Although Ghana performs well by regional standards, high government debt and underinvestment in its utilities infrastructure both threaten to derail economic growth and constitute major risks to investors. Because of these factors, we award Ghana a score of 46.7 out of 100 in the BMI Logistics Risk Index. While this score is uncompetitive from a global perspective, the country does perform well in a regional comparison, ranking fifth out of 48 Sub-Saharan African (SSA) states, increasing its attractiveness to investors, especially those seeking an...

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Ghana Trade & Investment

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Ghana's trade and investment environment is attractive from a regional perspective, driven by a steady inflow of foreign direct investment and a clear regulatory framework. However, the country's poor banking sector penetration, inadequate legal system and high levels of taxation pose risks to foreign investors. Consequently, Ghana is ranked fourth out of 48 countries in Sub-Saharan Africa (SSA) the Trade and Investment indicator, with a score of 55.0 out of 100. This mark is less competitive on an international level, placing the country just 75th out of 201 states.

Currently, the government is strongly pushing for greater public-private partnerships for important infrastructure projects. This method of investment mitigates some of the risk to investors, with private and public entities sharing the cost burden of these developments. Investors should be aware, however, of the risk emanating from the country's limited...

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Ghana Industry Coverage (15)

Agribusiness

Ghana Agribusiness

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BMI View: We believe that the Ghanaian cocoa sector will post reasonably strong growth over our forecast period to 2018/19. High cocoa prices will encourage production, while the government has pledged schemes in order to encourage yield growth. The launch of a new government project to revitalise the poultry sector suggests that the challenges facing the segment as it struggles to compete with imports are being taken seriously and, although firm proposals are thin on the ground, we remain optimistic about the industry's future. One of the main constraints on growth will be high feed prices, giving added urgency to programs aimed at increasing corn yields. We expect production levels to climb only gradually in the grains segment and concerns exist in the near future regarding food price inflation....

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Autos

Ghana Autos

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We forecast vehicle sales to grow at an average of 0.6% per annum over the 2015-2019 period hitting 69,350 by 2019. This forecast is for the number of new registrations in the country and includes both new as well as second hand autos based on data from the Ghana National Road Safety Commission. A downgrade from the previous quarter, our forecast takes into account the short-term headwinds which have affected the Ghana autos sales trajectory.

Domestic Demand To Drive Autos Growth

We believe a number of factors will generate wealth for the country and consequently boost consumer spending in the coming years. The Ghanaian economy will enjoy strong economic growth over the medium-to-long term, propelled by the nascent oil and gas sector. Ghana's abundant natural resources and fast growth trajectory will bode well for strong foreign investment inflows over the next five years.

...

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Commercial Banking

Ghana Commercial Banking

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Commercial Banking Sector Indicators
Date Total assets Client loans Bond portfolio Other Liabilities and capital Capital Client deposits

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Food & Drink

Ghana Food & Drink

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BMI View: We maintain our view that Ghana's real GDP growth will pick up in 2015 and 2016, rising to 4.5% and 6.7% respectively, following a 4.3% expansion in 2014. However, this is a downward revision since our last quarterly update; we previously forecasted a much more robust recovery to the tune of 5.8% in 2015, and 8.0% in 2016. Although we still believe that the worst is past, in terms of the macroeconomic meltdown that the country underwent last year, significant challenges to growth remain. Real private consumption will rise by 3.0% in 2015, a relatively sedate pace as Ghanaian consumers remain under pressure.

Headline Industry Data

  • 2015 per capita food consumption (local currency) = +11.4%; forecast compound annual growth rate (CAGR) 2014 to 2019 = +12.9%.

  • 2015 beer volume sales = +8.0%;...

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Information Technology

Ghana Information Technology

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BMI View: Ongoing investments in datacentres, broadband networks, the development of e-government services and IT companies' launch of internet of things platforms will underpin the particularly strong growth in the IT software and services segments in Ghana, Kenya and Nigeria over the five years to 2019. However, the still low penetration of computers means that the hardware segment will remain the largest contributor to all three countries' IT markets. Despite risks of lower commodities prices constraining government budgets, we expect the public sector to remain the largest spender on IT products and solutions, while consumer-facing industries such as financial services, telecoms, and retail, including e-commerce, to drive private sector IT spending.

Headline Expenditure Projections...

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Infrastructure

Ghana Infrastructure

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BMI View: We have lowered our forecasts for Ghana's construction industry on the back of the macroeconomic headwinds facing the country and electricity prices. These factors combined will limit the government's ability to invest in projects as well as dampening private sector investment projects. We forecast average annual real growth in the construction sector of 6.5% over our ten-year forecast period to 2024.

While we expect the construction sector to be one of the more resilient in Ghana's current macroeconomic crisis, we do see some spill-over effects as a result of cuts in government investment and weakened investor sentiment. However, the natural resource sector should continue to attract capital, creating opportunities for construction, and we see Chinese and development funding capital in the infrastructure sector...

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Insurance

Ghana Insurance

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BMI View: Ghana is witnessed increasing demand for insurance as living standards and disposable incomes rise and companies do more to market to low-income communities. This, coupled with advancement in distribution strategies, is leading to steady growth in premiums, albeit mainly in local currency terms. Going forward, we expect multinational insurance groups to move increasingly into the market, while local firms will be limited by their scale and lack of access to capital markets.

Ghana's insurance market, though growing, is at the early stage of its development. Total insurance penetration and density are both low at about 1% of GDP and USD16 per capita, respectively. Premiums having been growing at a rapid pace in local currency terms, though the level of growth has been boosted by inflation, which has also had an impact on claims as well as other costs to...

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Medical Devices

Ghana Medical Devices

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BMI Industry View : Ghana represents a comparatively small medical device market of just under USD60mn. Per capita spending is low at USD2.3 indicating considerable potential for expansion. Primarily supplied by imports, the market has enjoyed one of the world's highest CAGRs over the 2008-2013 period, but a sharp contraction in the market in 2013 and 2014 will result in slower growth being registered over the 2013-2018 period.

Headline Industry Forecasts

  • In 2013, the medical device market was estimated at USD59.6mn, equal to USD2.3 per...

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Mining

Ghana Mining

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BMI View: Over the coming quarters West Africa's growth outlook will be held down by continued mineral price weakness, inadequate infrastructure and the aftermath of the Ebola outbreak. The region's long-term growth outlook remains promising due to countries' vast untapped mineral reserves, positive foreign investment outlook and infrastructure developments.

  • Cote d'Ivoire - Cote d'Ivoire's gold production will experience solid growth due to new projects and low production cash costs. Cote d'Ivoire's main...

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Ghana Mining

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BMI View: Ghana's mining sector is heavily reliant on gold production and, as such, will face severe headwinds over the next few years as prices of the commodity come under increasing pressure globally.

Ghana's mining sector growth will be affected by a lack of diversity, as the country's gold sector accounts for about 90.0% of total mineral exports. An ongoing decline in global prices will therefore pose a major threat to the growth of Ghana's mining sector going forwards, with prices forecast to average USD1,120/USD over 2015-2019. Falling prices will put increased pressure on the profit margins of the country's gold miners, with many firms, including market leader Newmont Mining, moving to cut expenditure in the face of falling revenues. Despite gold price weakness, the country's mining sector will remain an important...

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Oil & Gas

Ghana Oil & Gas

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BMI View: The outlook on Ghana's upstream oil and gas sector remains broadly bullish, with development of the major Jubilee, TEN and Sankofa fields driving strong production gains over the next five years. However, continued fiscal and regulatory uncertainties and a moratorium on exploration drilling in the disputed territories with Cote d'Ivoire will limit upside to development and production in the back-end of our forecast period. The outlook on the downstream remains poor, and will drive a growing dependence on refined fuels imports across the decade.

We hold a bullish view on Ghana's oil and gas sector, as production from Jubilee, TEN and Sankofa ramps up in the front end of our forecast period. However, strong growth in consumption will outpace production, driving a widening supply demand deficit in the country. The...

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Pharmaceuticals & Healthcare

Ghana Pharmaceuticals & Healthcare

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BMI View: Our growth outlook for Ghana's pharmaceutical expenditure is positive, and will be driven by expanding NHIS coverage and improving public healthcare provision. Further reforms to Ghana's National Health Insurance Scheme (NHIS) will allow the scheme's continuation, improving the population's access to healthcare - as will the rise in healthcare infrastructure.

Headline Expenditure Projections

Pharmaceuticals: GHS1.01bn (USD329mn) in 2014 to GHS1.18bn (USD292mn) in 2015; +16.5% in local currency terms and -11.4% in US dollar terms. Forecast unchanged from Q215 in local currency terms, but downgraded in US dollar terms due to further depreciation of the cedi.

Healthcare: GHS5.83bn (USD1.90bn) in 2014 to GHS6.65bn (USD1.65bn) in 2015; +14....

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Power

Ghana Power

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BMI View: Increasing consumption rates, high transmission/distribution losses caused by ageing infrastructure and frequent interruptions to supply are exacerbating Ghana's ongoing power crisis. A year of low rainfall has affected hydropower output while shortages in gas supplies have impacted upon thermal power production which, combined with inefficient management and project delays has resulted in frequent and lengthy power outages in Ghana. The energy crisis is impacting heavily upon economic growth and resulting in increasingly widespread, though peaceful, protests in the country.

Ghana's government is moving to improve energy security in the country, including making management changes to the state owned utility, the Electricity Commission of Ghana (ECG), and opening up to private investment via...

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Retail

Ghana Retail

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BMI View: The average household spending is still low, which limits the amount of customers can purchase, particularly of non-essential luxury goods. However there is a slowly emerging middle class emerging in the urban areas in the south of the region centred around the capital of Accra, with more modern retail options also appearing as a result, meaning the long term opportunities for retailers could be substantial.

The growth levels in the Ghanaian economy have slowed down in the last two years meaning that the total GDP of Ghana is expected to be just USD31bn in 2015. However growth is expected to return to the country soon and the economy's GDP should reach USD47bn by 2019 which is a growth of over 50% and this development should represent more opportunities for retailers. The Ghanaian economy is driven by exports of its valuable natural resources such as gold and oil, as well as...

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Telecommunications

Ghana Telecommunications

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BMI View: The NCA's plan to license MVNO players in Ghana's already crowded mobile market will push price competition to unsustainable levels. This will encourage operators to seek further cost efficiencies and could trigger consolidation among the smaller players. In January 2015, Ghana's National Communications Authority (NCA) has invited applications for three new telecoms licences in the country. The authority will award a mobile virtual network operator (MVNO) concession, a fixed access service of a unified access service licence and an international wholesale carrier (IWC) licence.

Key Data

  • The Ghanaian mobile market grew by 2.2% q-o-q and by 8.3% y-o-y in Q414 to reach 114.7% market penetration.

  • The mobile data market grew by 2....

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