Ghanaian economy set for rise in face of political contention

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The Ghanaian economy could be set to grow by up to 14% this year but with national elections scheduled for December, critics have questioned the wisdom of such rapid growth.

Any over spending could trigger a widening of the budget deficit, something which could have dangerous long term consequences.

Ishac Diwan, the World Bank’s Ghanaian country director, has commented on the potential problems which the link between finance and politics could have for Ghana. “The strong political contention in the country could make ruling parties over-spend before elections.

Ghanaians must be fiscally responsible to monitor Government’s investments, and tame politicians from over-spending especially in areas which would leave big holes in the deficit and shoot inflation upward.”

The predicted 14% rise is due mainly to Ghana beginning production of oil for export purposes at the end of 2011. There have been other encouraging, if rather vague, bulletins on financial growth and stability for the African nation in the near future.

A statement which is due next month from the Ghanaian finance ministry is expected to focus on which areas spending will take place in to help boost growth. That follows a recent announcement that expenditure is expected to rise in the near future.

The country has also targeted a cut in its budget deficit that should take it to as lows as between 5%-5.5%. That follows a recent high of 6.8% from last year.

Ghana will also benefit from a boost to their agriculture industry and a change in the way they produce agricultural output across the country. A national program established last year offered technical support to farmers which included training and the use of better quality seeds.

This is expected to boost Ghana’s cotton production to around 50,000 metric tons from an average of 5,000. This is alongside a proposed grant of 150 million USD for the agricultural industry which the World Bank board of directors are expected to decide on shortly.

There are a number of reasons to feel confident that Ghana’s economy can look forward to an exciting future. Any economic rises should be made alongside consideration of a budget deficit though that requires stability.

Transfer Money to Ghana

If you are looking to invest in Ghana, think carefully about how you are planning to transfer money to Ghana. Many foreign currency exchange rates quoted by banks are not as good as the exchange rates available through specialist currency dealers.

If you are sending money to Ghana, which you will have to do if you are looking to make a property investment, be sure to compare the market before you buy your overseas currency.

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Ghanaian economy set for rise in face of political contention

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