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Economic and Financial Crisis Deepens in Ghana

Geoff Riley

6th October 2023

Ghana's economy has been struggling in recent years due to a combination of factors, including high inflation, a depreciating currency, and rising debt levels. As a result, many people in Ghana are facing economic hardship, including rising prices for goods and services, job losses, and difficulty finding affordable housing. There have been protests against the government's handling of the crisis, and some people are calling for the resignation of the governor of the Bank of Ghana.

Ghana was once one of the fastest-growing economies in the world. But in 2022, we saw the emergence of a deep economic crisis with rapid inflation and a steep rise in poverty. External factors has contributed to rising inflation including rising global food prices. But excessive government spending and rising government debt have led to a sharp depreciation of their currency leading to even higher import prices. Corruption - possibly extending to the highest levels of the central bank and Ministers amassing millions in unexplained wealth - has become the dominant political issue in the country.

The Bank of Ghana has posted a record $5billion loss and protestors are calling for the Head of the Bank of Ghana to resign. The country has lost billions of $s of reserves which has accelerated the depreciation of their currency.

BBC News: How Ghana’s rising star plunged into an economic crisis

How Ghana’s rising star plunged into an economic crisis - BBC Africa

Recommended podcast from the Financial Times:

The FT’s west Africa correspondent Aanu Adeoye and Africa editor David Pilling explain how Ghana exemplifies the debt cycle that many African countries find themselves stuck in, and what has to change to break it.

Click here for the podcast

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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