Bankers have expressed renewed optimism for the Ghanaian economy’s prospects despite the continuous fall in commodity prices, slow growth in the economy, and an upcoming general election.

According to figures from the Ghana Statistical Service, the last time the economy recorded growth below 4 percent was in 2000 when GDP, which measures the value of final goods and services produced in the country, decelerated to 3.7 percent.

But currency stability, improvement in the energy supply challenges, and the strict adherence of government to conditionalities in the International Monetary Fund’s (IMF) programme has led some bankers to believe that the economy is on a path to the growth seen in the first decade of the 21st century.

In an interview with the B&FT, Edward Botchway-Chief Financial Officer of Ecobank, said the country is in a much better position moving forward than it was a couple of years ago.

“The task (bringing the economy back to its growth track) is clear, and we all have to do what we have to do. We are very certain of what we have to do, and as we do it efficiently and effectively Ghana will be a much better place,” he said.

He added that Ecobank, the biggest bank in the country, will continue to press forward in supporting individuals and businesses to grow, and he thus sees 2016 and beyond being much better than 2015.

Edward Effah, Managing Director of Fidelity Bank, also shared the same view when he told the B&FT that Ghana has made good progress so far.

“When we look back to three years ago we had a twin deficit, fiscal and trade; but over the years, through government efforts and the IMF programme, we have been able to bring down the deficit from 12 percent to about 7.5 percent,” he said.

Government is hopeful that this year economic activities will rebound with a projected real GDP growth of 5.4 percent, despite the IMF lowering Ghana’s economic growth in 2016 to 4.5 percent as a result of the continued fall in prices of commodities on the world market.

However, the country’s fiscal managers are confident improvements in energy supply will boost economic activities and cause businesses - which performed at half their capacity or shut down completely at the peak of the energy crisis last year -- to ramp-up output.

With the budget deficit projected to drop further to about 5 percent and a seemingly stable currency, Mr. Effah believes the country is poised for future strong growth after 2016.

Diversification to sustain gains

Mr. Effah quickly added that in order to sustain the gains Ghana has chalked up so far, the economy needs to be diversified further. “I think that as a nation we need to continue diversifying the economy.”

He explained that given the current global commodity price slumps, many African countries that rely on only one commodity are struggling: in the case of Nigeria and Angola, oil; and Zambia, copper.

“But Ghana is fortunate to rely on a bouquet of commodities: oil, gold, cocoa, a diversified SME sector, and also growth of the non-traditional export sector as well.”

With Ghana losing about US$700million last year as a result of the drop in oil prices, Mr. Effah believes t it didn’t hurt the economy hatmuch since the nation does not rely or depend on any one commodity for 90 percent of our foreign exchange earnings.

“The economy is more resilient and it is important that we diversify, unlike some of those other countries who were doing very well until oil prices dropped significantly -- and now they can’t function and banks are collapsing because these things affect the banking sector.”

Celeste Fauconnier, Rand Merchant Bank’s Africa Macro Strategist for Global Markets, in an interview recently also stressed the need for diversifying the economy to rely less on commodities and restoring agriculture to its glory-days.

“The government needs to invest in education, agriculture, manufacturing and other aspects that are purely industry-focused which are key to developing economies. With manufacturing you can grow your economy and develop within, and not overly depend on international investors,” she said.

She added that if agriculture becomes a bigger component in the market, when commodity prices go down the agriculture sector will be strong enough to support local manufacturers and inflation will be kept low.