Ghana’s Economic Growth is Fueled by Gold & Oil—But is it Truly Inclusive and Sustainable?—-Despite Ghana’s steady economic growth in recent years, a critical issue persists—who is truly benefiting from it? While GDP figures suggest progress, many businesses and individuals remain trapped in economic hardship, struggling with high costs, low wages, and limited opportunities.
The Chief Executive Officer of the Ghana National Chamber of Commerce and Industry (GNCCI), Mark Badu Aboagye, speaking in an interview with The High Street Journal, argued that Ghana’s growth is not inclusive, nor is it sustainable. He noted that while the economy continues to expand, the benefits are concentrated in gold, oil, and other extractive industries – sectors that generate billions of dollars but employ only a small fraction of the population.
“The kind of growth we have been experiencing is not sustainable. We need growth that benefits the majority of our people, not just a few sectors,” he stated.
A Growth Model That Leaves People Behind
The over-reliance on raw material exports, particularly gold, cocoa, and oil, has left key sectors like agriculture and manufacturing underdeveloped, limiting job opportunities for the majority of the population. While these industries contribute significantly to national revenue, they fail to generate employment at scale, leading to a widening gap between economic expansion and job creation.
This overdependence on raw exports not only restricts job creation but also weakens Ghana’s position in international markets, making its economy vulnerable to price fluctuations.
“Our exports are not competitive. That is why we have been concentrating on exporting raw materials like cocoa and gold. We need to move to value addition so we can enter other markets,” he said.
According to findings from the Ghana Statistical Service (GSS), this gap has continued to widen over the years. The mining sector, for example, is one of the country’s most productive industries but does not create enough jobs to absorb the growing labor force.
Meanwhile, a significant portion of Ghanaians still rely on informal work, small businesses, farming, and trading, where incomes are unstable and job security is low. Even as Ghana’s economy modernizes, the majority of its workforce remains in sectors with little to no protection, benefits, or stability.
The “National Report on Productivity, Employment, and Growth” from the GSS paints a concerning picture of a labor market struggling to keep pace with the growing number of job seekers. Between 2000 and 2021, Ghana’s employment rate fell sharply from 73.9% to 55.7%, despite overall job creation during that period.
This signals a critical mismatch between employment opportunities and the expanding working-age population, raising serious concerns about Ghana’s ability to provide stable, decent jobs for its people.
Macroeconomic Instability: The Silent Killer of Businesses
While Ghana’s labor market struggles, businesses are also grappling with an unstable macroeconomic environment, which has further weakened job creation and investment confidence. High inflation, volatile exchange rates, and steep interest rates have made it difficult for companies to expand, hire, or even stay afloat. Many firms have opted to relocate to other West African countries with more stable economic conditions.
“As businesses, there is no way we can exist without having a stable macroeconomic environment to set the basis and the foundation for whatever we do. If the environment is unstable, we have high inflation, volatility, high interest rates, high policy rates, and all those things, businesses will not survive,” Mr. Badu Aboagye stated.
For businesses to thrive, he stressed, there must be fiscal discipline, efficiency in public spending, effective monetary policy, and exchange rate stability. Without these, Ghana’s private sector will continue to struggle, making job creation and sustainable economic growth nearly impossible.
Lack of Competitiveness in International Trade
Another key issue is Ghana’s lack of competitiveness in global markets, driven by high production costs, expensive electricity, high-interest rates, and burdensome taxation. While the country remains heavily dependent on raw material exports, it fails to add value to its products, missing out on opportunities to increase revenues, create jobs, and strengthen its economic standing.
“If you go to the market, they are not buying your product because it’s from Ghana. They buy based on quality and affordability. Our products are not competitive, and that is a major problem.
“If we enter into the international market and our cost of production is too high, because of electricity costs, high taxes, and expensive credit, obviously, nobody will buy our products. Buyers are looking for the best price and quality, not just where the product is coming from. So, if we want to compete, we must address these structural issues.”
Without lowering production costs and shifting towards industrialization, Ghana will remain vulnerable to global commodity price fluctuations and external economic shocks. This reliance on unprocessed exports, combined with a high-cost business environment, continues to limit the country’s ability to diversify and grow its economy in a way that benefits all citizens.
Bridging the Gap: A Call for Inclusive and Sustainable Growth
To break this cycle, Ghana needs a bold, strategic approach that prioritizes job creation, strengthens local industries, and fosters economic inclusivity. The upcoming National Economic Dialogue presents a unique opportunity for stakeholders to move beyond political rhetoric and push for real, actionable solutions.
Mr. Badu Aboagye outlined several key areas that require immediate attention:
- Stabilizing the macroeconomic environment—ensuring fiscal discipline, reducing inflation, and maintaining a stable exchange rate to restore investor confidence.
- Prioritizing agriculture and manufacturing—reducing import dependency and investing in domestic production to create jobs and boost food security.
- Enhancing export competitiveness—investing in technology, infrastructure, and policy reforms to support value addition and penetrate global markets.
- Lowering the cost of doing business—reducing electricity tariffs, taxes, and interest rates to enable local industries to compete regionally and internationally.
Without these interventions, Ghana risks further economic disparity, where a few industries thrive while the majority of the population struggles to find sustainable employment.
Mr. Badu Aboagye expressed optimism that the upcoming National Economic Dialogue could serve as a platform for real change. However, he emphasized that talk alone is not enough, concrete actions must follow.
