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GROUP 6 A PRESENTATION ON

FACTORS AFFECTING ECONOMIC GROWTH I N THE GHANAIAN ECONOMY

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OBJECTIVES Basic concept of economic

growth Factors that affect economic

growth How these factors affect

economic growth in the Ghanaian economy

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Definition of economic growth

Economic growth is the increase in the real gross domestic product(GDP) of a country over a period of time . It is measured as the percentage rate of increase in the GDP. The economic growth for 2011 was 14.4%, 2012 7.1% and 2013 8.0%

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FACTORS AFFECTING ECONOMIC GROWTH IN GHANA

Currency strength Interest rate Unemployment Balance of payment

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CURRENCY STRENGTH It express the value of a country’s

currency with respect to other currencies. Several factors determine the strength of

a country’s currency including:1. The purchasing power of the currency.

Presently 1 USD goes for GHS 2.8225 2. Supply, demand and inflation will cause

changes to a currency’s relative worth. Thus a strong currency plays a key role in

economic growth.

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INTEREST RATE

It can briefly be explained as the amount charged expressed as a percentage of a principal by a lender to a borrower for the use of an asset.

The benchmark interest rate in Ghana was last recorded at 18%.

Interest rate in Ghana was averaged at 16.56% from 2002 until 2014 and it is only determined by the Central Bank

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UNEMPLOYMENT

The importance of employment to human sustenance and a country’s development cannot be overemphasized.

To a nation employment is not only a catalyst to growth but also a means to poverty reduction.

The unemployment level stood at 2.8% in 1984 and increased to 10.4% in 2000. After a short fall of 6.5% in 2008, it later moved to 8.5% in 2010 and increased by 4.2 million in 2012.

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BALANCE OF PAYMENT

It can be expressed as the monetary value of exports and imports in an economy over a certain period of time .Ghana's BOP deficit shot up to $2.3 billion at the end of 2012,a rise exceeding 798% of the $288million recorded for the corresponding period of 2011.

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CONCLUSION

Despite the fact that the global economic recession cannot be denied, and that even countries with stronger economies are feeling the full force of the recession, the economic destiny of Ghana remains in her own hands.

Policies have to be reviewed, institutions have to be strengthened, and above all government has to be more accountable if the economic future of Ghana would be anything to write about

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END OF PRESENTATION