The economies of Ghana and Nigeria are poised to see the slowest economic growth in 2024 when compared to their peers in the West African region.
Overall, the West African region is expected to grow by 0.8% to 4.0% this year and 4.4% in 2025 according to the AfDB macro-economic performance outlook for 2024.
The African Development bank stated that aside Nigeria and Ghana, every other country in the sub-region is estimated to grow by at least 4% in 2024 with embattled Niger leading the pack at 11.2% followed by Senegal and Ivory Coast at 8.2% and 6.8% respectively.
The bank’s forecast for Nigeria anticipates a growth rate of 2.9% in 2024, improving to 3.7% by 2025. This modest growth trajectory is primarily linked to the repercussions of recent policy reforms, including the elimination of fuel subsidies and the efforts to consolidate the foreign exchange markets.
These measures, while aimed at stabilizing the economy, have temporarily exacerbated the cost of living, suppressing both consumer spending and investment.
Despite these challenges, the report suggests that the strategic redirection of resources—specifically, the $5 billion formerly allocated to fuel subsidies between 2022 and May 2023—towards vital social infrastructure, holds the promise of yielding significant long-term benefits over the immediate discomforts.
In contrast, Ghana’s economic growth is expected to slightly pick up to 2.8% in 2024, from a sluggish 1.5% in 2023. The analysis attributes this slow pace to persistent inflationary pressures that continue to strain household budgets, implying that inflation remains a critical barrier to Ghana’s economic revival and growth prospects.
Ghana grappled with an unprecedented economic downturn in 2023, marked by a staggering inflation rate that peaked at over 50%. However, recent reports as of indicate a significant easing of inflation to 23.4%. The Ghanaian currency, the Cedi, also faced a steep devaluation of over 11% in the first half of 2023
