Proceeds from oil export have overtaken cocoa as Ghana’s second biggest foreign exchange earner, latest figures from the country’s central bank show.
According to the Bank of Ghana (BoG), the country has been earning more from the oil sector than the cocoa sector since January, this year.
Total oil export receipts for January was $400.1 million, while cocoa accounted for $302.2 million. In February, oil exports increased to $664.9 million, while cocoa export on the other hand also increased to $619.5 million.
Oil exports for March, April, May, June and July also performed better than cocoa as it recorded $1.05 billion, $1.42 billion, US$1.91 billion, $2.1 billion, and $2.4 billion respectively as against the $858.6 million, $1.05 billion, $1.2 billion, $ 1.29 billion, and $ 1.3 billion recorded by cocoa over the same period.
The situation was not different in August as oil exports peaked at $2.91 billion which was more than double of the $1.45 billion that was recorded for the cocoa sector.
The increase is attributed to a rise in production from the Jubilee Fields and the coming on board of TEN and Sankofa Gye Nyame.
Trade surplus hits $1.4 billion
The country’s trade surplus also increased from $1.26 billion in July to $1.4 billion in August 2018, representing 2.7 per cent of GDP.
The figure was also largely driven by the oil sector which recorded strong growth in August 2018.
The growth in the country’s surplus, however, failed to reflect in the gross international reserves which decreased from $7.05 billion in July to $6.69 billion, capable of providing import cover for three and half months.
The Governor of the Bank of Ghana, explaining why the trade surplus failed to positively impact the country’s reserves, said it was because trade surplus was being driven by the oil sector where there was limited local content.
“We should ask ourselves why we are not deriving the full benefits of the services that are related to the oil sector. This is where the work has to be done. We need to improve the local content in that sector,” he stated.
“Once we begin to be more integrated in the sector and have local participation in the sector improved through provisions of services, we will benefit from the services and it will translate into our reserves,” he added.
He said these were structural issues that the BoG alone could not resolve.