Ghana Country Risk Report

Published 25 February 2015 | Quarterly

  • 40 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
 
$1,195.00
Ghana Country Risk Report

Core Views:

  • Economic growth in Ghana will be buoyant over 2015-2018 thanks to rising oil production and strong investment inflows - the latter encouraged by IMF policy oversight.

  • Foreign investment inflows will be robust thanks to Ghana's abundant natural resources and relative political stability.

  • The current account deficit and fiscal deficit will remain key structural weaknesses in the economy.

  • Peaceful protests against power shortages and economic hardship will take place in 2015. Ghanaians are wary of the conditions that may be attached to IMF support.

Major Forecast Changes:

  • We have revised our forecast for the current account following the dramatic drop in oil prices in the final months of 2014. We now project a deficit of 11.9% of GDP in 2015, versus a previous 8.4% forecast.

Key Risks To Outlook:

  • If a deal is not agreed between the government and the IMF, investor sentiment will sour severely.

  • The Ghanaian cedi remains vulnerable amid the sizeable current account deficit and could depreciate more swiftly than we anticipate.

  • Mismanagement of oil revenues - perhaps stemming from insufficient institutional capacity - could dent investor perceptions.

  • The Ebola virus could spread to Ghana, causing severe illness and death, and disrupting economic activity.

Macroeconomic Forecasts (Ghana 2013-2016)
Indicator 2013 2014e 2015f 2016f
National Sources/BMI
Nominal GDP, USDbn 40.0 35.6 37.1 40.6
Real GDP growth, % y-o-y 7.1 4.3 5.8 8.0
Consumer price inflation, % y-o-y, eop 13.5 17.0 10.5 9.9
Exchange rate GHS/USD, eop 2.38 3.22 3.66 3.97
Budget balance, % of GDP -10.0 -9.3 -7.6 -6.9
Current account balance, % of GDP -14.3 -9.2 -11.8 -10.3

Table of Contents

Executive Summary
5
Core Views
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Domestic Politics
8
On The Ground: Dissatisfaction, But High Hopes For IMF Deal
8
Table: Political Overview
8
Long-Term Political Outlook
9
Oil To Prove A Critical Test For The Polity
9
Chapter 2: Economic Outlook
13
SWOT Analysis
13
BMI Economic Risk Index
13
Economic Activity
14
Economy On The Road To Recovery
14
Tab le: Economic Activity
14
Exchange Rate Policy
16
GHS: Depreciatory Trend To Resume, Gently
16
Table: Exchange Rate
16
Banking Sector Outlook
17
Banks Emerging Unscathed, Poised For Growth
17
Table: Currency Forecast
17
Table: Banking Sector Statistics
18
Regional Economic Outlook
19
Ebola: Long-Lasting And Wide-Ranging Implications
19
Table: Guinea - Eco nomic Activity
19
Table: Liberia - Eco nomic Activity
19
Table: Sierra - Eco nomic Activity
19
Chapter 3:10-Year Forecast
25
The Ghanaian Economy To 2023
25
Oil To Boost Growth Over The Long Term
25
Tab le: Lo ng-Term Macro eco nomic For ecasts
25
Chapter 4: Operational Risk
27
Operational Risk Index
27
Operational Risk
28
Table: Operational Risk
28
Transport Network
29
Table: Transport Network Risks
30
Economic Openness
33
Table: Economic Openness
34
Table: Top Five Trade Partners -Product Imports (USDmn)
35
Table: Top 5 Product Exports (USDmn)
36
Chapter 5:BMI Global Assumptions
37
Global Outlook
37
Reality Check: Uncertainty Reigns
37
Table: Global Assumptions
37
Table: Developed States, Real GDP Growth, %
38
Table: BMI VE RSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
38
Table: Emerging Markets, Real GDP Growth , %
39

The Ghana Country Risk Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Ghana. It is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Ghana's economic, political and financial prospects through end-2019, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

  • Forecast the pace and stability of Ghana's economic and industry growth through end-2019.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise Ghana's country risks against regional peers using BMI's country comparative Risk Index system.
  • Evaluate external threats to doing business in Ghana, including currency volatility, the commodity price boom and protectionist policies.

The Ghana Country Risk Report by Business Monitor International (BMI) includes three major sections: Economic Outlook, Political Outlook and Operational Risk.

Economic Outlook:

How will the Ghana' economic policy-making and performance impact on corporate profitability over 2015-2019?

BMI provides our fully independent 5-year forecasts for Ghana through end-2019 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Ghana Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector obligations).
  • Global Assumptions - forecasts for each year to end-2019 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for Ghana and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Ghana, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in Ghana over the next 5-years?

BMI's Ghana country Risk Index evaluates the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the Ghana Market - Political Strengths, Weaknesses, Opportunities and Threats facing Ghana.
  • Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Ghana's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
  • Long-Term Political Outlook BMI examines the structural risks to the stability of Ghana’s political system and the dominant public policy issues likely to affect decision-makers, and outlines scenarios for how the state could evolve in the medium to long term.

Key Benefits

  • Benchmark Ghana's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Operational Risk

What are the current operational risks and difficulties associated with doing business in Ghana?

The Operational Risk section gives an evaluation of current risks and difficulties associated with operating in the market. It also provides a brief overview of the regional Operational Risk Index which benchmarks Ghana against its neighbours.

Operational Risk Contents

The chapter provides a summary of the main threats in the country, within:

  • Labour Market Risk (Education; Availability of Labour; and Labour Costs)
  • Logistics Risk (Market Size and Utilities; Quality and Extent of the Transport Governance)
  • Trade and Investment Risk (Economic Openness; Government Intervention; and Legal Risks)
  • Crime and Security Risk (Crime; Terrorism; and Interstate Conflict risks).

The report also drills down in greater depth to address key issues in one of the following segments most critical to the market:

  • Transport network, economic openness, cost and availability of labour, crime risks, bureaucratic environment, market size and utilities, and interstate conflict.
  • Assess your company’s exposure to country specific operational and business risks, using BMI’s insight on the current dangers of operating in the market.
  • Evaluate Ghana’s risk profile against its regional peers, helping you understand the market’s strengths and weaknesses in relation to other countries.

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Testimonials

The sections that I find most interesting and useful are the macroeconomic data and forecasts for the country, top export destinations and economic activity. The indicators/analysis of these areas helps us orient our thinking, our assumptions and, consequently, our decisions in the commercial area.

Country Manager, DHL Express