Ghana has witnessed a significant trade growth in the second quarter (Q2) of 2024 by about 14.31%, due to a surge in gold exports. Data from the Ghana Statistical Service (GSS) reveals that in Q2, Ghana’s total trade value reached GH₵123.0 billion, with GH₵64.2 billion in exports and GH₵58.8 billion in imports, reflecting an increase in trade activity compared to Q1 2024. In U.S. dollar terms, the total trade value for Q2 stood at $9.0 billion.
When compared to Q1 2024, (which recorded a total trade value of GH₵107.6 billion—comprising GH₵59.5 billion in exports and GH₵48.1 billion in imports), Q2 shows a notable growth in both exports and imports.
However, Q1 2024 saw a larger trade surplus of GH₵11.5 billion, denoting a 52.2% decrease in the surplus between Q1 and Q2. While Q2 exhibited higher overall trade volumes, the surge in fuel imports reduced the trade surplus compared to the first quarter.
Gold Drives Export Boom
Gold bullion led the country’s exports with a value of GH₵37.0 billion, making up 57.6% of total exports. Other significant export commodities included crude petroleum, valued at GH₵12.6 billion, and cashew nuts, which contributed GH₵1.2 billion to the export tally.
The United Arab Emirates (UAE) emerged as Ghana’s top export destination in Q2 2024, with exports worth GH₵15.0 billion, representing 23.3% of the country’s total exports. Switzerland followed closely with exports valued at GH₵13.2 billion, accounting for 20.5%, while South Africa ranked third with exports worth GH₵8.3 billion, representing 12.9% of total exports.
Imports Predominantly from Asia
On the import side, gas, oil, and motor spirit super were the largest contributors, with values of GH₵7.3 billion and GH₵7.2 billion, respectively. Together, these fuel imports accounted for nearly 25% of Ghana’s total import value in Q2 2024.
Asia continued to dominate as Ghana’s primary trading partner, contributing more than half of the country’s imports and nearly half of its exports. China remained Ghana’s largest source of imports, contributing GH₵12.3 billion, or 20.9% of the country’s total imports, followed by the UAE at GH₵9.1 billion (15.4%) and the United Kingdom with imports valued at GH₵5.2 billion (8.8%).
Shifts in Global Trade Relations
Between Q2 2023 and Q2 2024, notable shifts in Ghana’s trade patterns emerged. While imports from Europe declined by 7.5%, imports from Asia increased significantly by 8.5%. This shift underscores the growing importance of Asia in Ghana’s trade relations, further cementing the region’s role as a dominant trade partner.
Price Increases in Key Commodities
The Export and Import Unit Value Indices (UVIs) highlighted notable price shifts in Ghana’s key commodities. Export prices saw a year-on-year increase of 40.5%, driven primarily by surging gold prices, which bolstered the value of the country’s gold exports. Meanwhile, import prices also rose, with an 18.9% year-on-year increase, reflecting the higher cost of key imported commodities such as fuel.
Comparing Ghana’s Trade Performance in Q1 and Q2 2024
While Q1 2024 delivered a stronger trade surplus, Q2 2024 saw an increase in overall trade activity.
Q2 2024 saw a significant rise in overall trade activity, with a total trade value of GH₵123.0 billion, compared to GH₵107.6 billion in Q1 2024. However, while Q2 achieved a trade surplus of GH₵5.4 billion, it was notably lower than the GH₵11.5 billion surplus recorded in Q1. This discrepancy is largely due to a 22.2% surge in imports in Q2, particularly driven by fuel products like gas oil and motor spirit, which offset gains from exports, especially in gold.
In comparison, Q1 had a more balanced trade structure, with stronger export growth and moderate import increases, allowing for a larger surplus. Gold exports, which accounted for 50% of total exports in Q1, surged by 24.6% in Q2, making up 57.6% of exports. However, rising fuel imports in Q2 outpaced this growth, leading to a smaller surplus.
The data revealed that one reason to explain the shifts in Ghana’s trade performance between Q1 and Q2 of 2024 is the significant rise in fuel imports, particularly gas oil and motor spirit super, which together accounted for 24.7% of total imports in Q2. This increase in fuel imports was driven by growing energy demands, a result of the country’s economic recovery and industrial expansion. The surge in fuel imports in Q2 reduced the trade surplus compared to the more balanced trade performance in Q1.
At the same time, export growth was driven largely by gold. Gold exports surged by 24.6% from Q1 to Q2, with the metal making up 57.6% of total exports in Q2. This rise was fueled by higher gold prices on the global market, which boosted overall export figures. However, while gold and crude petroleum exports grew, cocoa exports faced challenges in Q2 due to issues such as the swollen shoot virus. This led to a sharp decline in cocoa output, which dampened the positive impact of export growth from other sectors.
There was also a notable shift in key export destinations between the two quarters. In Q2, the United Arab Emirates overtook Switzerland as Ghana’s top export destination, reflecting changing global demand dynamics, particularly for gold and crude petroleum, which are major exports to the UAE.
Additionally, rising global prices contributed to the shifts between the two quarters. Export prices increased by 40.5% in Q2, driven by higher gold prices, while import prices rose by 18.9%, largely due to the rising cost of fuel. This increase in import prices added to the country’s import bill and contributed to the shrinking trade surplus in Q2.
This implies that while Q2 marked higher overall economic activity, driven by both export growth and increased energy demands, the country’s reliance on imported fuel presents a challenge for maintaining trade balance. Q1, with its larger surplus, shows a more favorable trade position, but Q2 highlights the need for careful management of rising imports, especially in sectors like fuel, to sustain trade surpluses going forward.
