Claim: Member of Parliament for Nhyiaeso Constituency, Stephen Amoah, has quoted 2.02 as Africa’s GDP growth rate in 2020.
Verdict: False. Relying on the 2022 African Economic Outlook report by the Africa Development Bank, the continent’s GDP growth rate was -1.6% in 2020.
Full Text
Member of Parliament for the Nhyiaeso Constituency in Ghana, Stephen Amoah, has justified the government’s move to increase the Value Added Tax rate by 2.5%.
Although the Minority group in Parliament insists that the increment will worsen the hardship on Ghanaians, Stephen Amoah says that the adjustment was needed to increase the country’s revenue generation ability and help grow the economy.
Speaking on the floor of parliament during a debate on the matter, the Member of the Finance Committee in Parliament said that the continent’s GDP contracted by 2.02%.
He also quoted 0.4% as the 2020 GDP growth for Ghana and 3.3% as the projected growth rate for the global economy.
“You will remember the global expectation of GDP growth was 3.3%. In 2020, because of this exact situation, the continent of Africa grew by 2.02%, but Ghana grew by 0.4%. While the government of the day was performing its statutory obligations, our GDP was not growing,” the Member of the Finance Committee in Parliament asserted.
He made the assertion to back his argument that the government needed to raise more revenue to grow the economy.
His comments can be captured between minutes 2:51:12 to 2:51:50 of the attached video.
Our investigation was to determine the accuracy of the figures quoted by the MP.
We relied on data from the World Bank, African Development Bank, Ministry of Finance (Budget Statements), and German database organisation, Statista.
Verification
Data from the Africa Development Bank (AfDB) and Ministry of Finance all quote 0.4% as Ghana’s GDP growth rate in 2020.
“Mr Speaker, after growing at 0.4 per cent in 2020, reflecting the impact of the COVID-19 pandemic, the economy picked up strongly in Q1-2021, reflecting the impact of the Covd-19 containment measures and recovery interventions the Government has been implementing since COVID-19 broke out in March 2020,” paragraph 78 of the government’s 2021 Mid-year budget review statement reads.
However, the World Bank and the International Monetary Fund currently quote 0.5% as Ghana’s GDP growth in 2020.
Regarding Africa’s economic growth, the Africa Development Bank, in its African Economic Outlook 2022 Report (Page 4), said that the continent’s economy grew by -1.6% in 2020.
“Following a contraction of 1.6% in 2020, Africa’s GDP grew by 6.9% in 2021,” the report reads.
The graph showing the GDP growth rate for 2019-2023 (Source: AfDB African Economic Outlook 2022 report]
This -1.6% growth rate quoted by the AfDB is revised. In their African Economic Outlook 2021 (Page 180) report, the AfDB said, “Real GDP in Africa is projected to grow by 3.4 per cent in 2021, after contracting by 2.1 per cent in 2020.”
Data from Statista indicate that Africa’s GDP growth rate was -1.8% in 2020.
Even though the figures from AfDB and Statista are slightly different, they both fall below the -2.02 quoted by Stephen Amoah.
Other international organisations with data on economic growth, such as the World Bank and the IMF, do not have data for Africa as a whole. They rather have data for Sub-Saharan Africa, which may not be used to represent the entire continent as it does not include North African countries such as Egypt, Algeria, Libya, Tunisia, and Morrocco.
Conclusion
Although the MP rightly quoted Ghana’s GDP growth in 2020, his figure for the continent is inaccurate. The Africa Development Bank, in a recent report, says the continent’s GDP growth rate was -1.6% for 2020.
