ECON 215 Introduction to Economy of Ghana Session

Transcript:ECON 215 Introduction to Economy of Ghana Session:
ECON 215 Introduction to Economy of Ghana Session 5 – External Sector Part 2 Lecturer: Dr. Emmanuel A. Codjoe & Dr. Michael Danquah Contact Information: ecodjoe.ug@gmail.com Session Overview Session Overview: This session considers Ghana’s external sector in detail and discuss the medium term strategies for Ghana’s external sector. Goals/ Objectives: At the end of the session, the student will Understand the importance of Ghana’s external sector Know the direction of Ghana’s trade Be aware of strategies which have been put in place to enhance the development of Ghana’s external sector. Slide 2 Session Outline The key topics to be covered in the session are as follows: Topic One: Ghana’s External Sector Topic Two: Ghana’s Balance of Payments Topic Three: Outlook For the External Sector Slide 3 Reading List Refer students to relevant text/chapter or reading materials you will make available on Sakai Slide 4 GHANA’S EXTERNAL SECTOR Topic One Slide 5 Importance of External Sector Like all countries Ghana trades with the rest of the world because of the benefits derived from trade. These benefits include the following: It enables Ghana to access goods and services not available locally. Ghana is able to sell goods and services that it has in relative abundance. Ghana is able to attract foreign expertise and capital to develop her economy. Trade increases competition which forces firms to be more efficient and offer more benefits to consumers. Because of the need to produce for export, Ghana is able to take advantage of benefits derived from large-scale production i.e. economies of scale. Slide 6 Direction of Ghana’s Trade Destination of Exports During the review period, the European Union received the largest share of Ghana’s total exports (29.1%). The other recipients were the Far East (26.5%), Other European countries (13.3%), Other Economies (9.9%), the Rest of Africa (9.5%), ECOWAS (8.6%), and North America (3.0%). India was the single largest destination of Ghana’s exports in the first quarter of 2015, representing about 12.4 per cent. The main export to India was gold. Other important markets for Ghanaian exports included: Switzerland (10.9%), Netherlands (8.7%), South Africa (8.6%), United Arab Emirates (8.0%), China (7.0%), Italy (6.6%), Malaysia (3.3%), Portugal (3.2%) and USA (2.8%). Slide 7 Direction of Ghana’s Trade Cont’d Origin of Imports In terms of geographical distribution, the Far East was the leading source of imports accounting for 30.6 per cent of the total non-oil imports. The European Union