Effect of Covid-19 on Ghana's Economy

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Just imagine a beautiful Saturday morning, the last day of December in 2019 in the city of Wuhan, the heart of China, where everybody was busy with their daily activities. Suddenly, darkness visited them.

The blood tasty jaws of this monstrous darkness kept spreading and devouring its captives until finally reached the end of the vast ocean. Wait! What at all is all these misfortune and calamities about? Indeed, it’s all about Coronavirus disease(covid-19). What then is coronavirus disease and how vast has it affected Ghana’s economy?

According to literature, this virus belongs to a group of viruses causing infection ranging from the regular cold to more severe diseases including the Middle East Respiratory Syndrome-related Coronavirus (MERS COV) and Severe Acute Respiratory Syndrome-related Coronavirus(SARS-CoV-2). Interestingly, this strain has never affected the human race before.

In Ghana, the outbreak was reported on March 12th, 2020. As at August 2021, a total of 43,094 cases were recorded with 40,963 recoveries and 256 deaths according to Citinewsroom report August 2021. Prior to covid-19 incidence, Ghana recorded as high as 6.3 percent as Gross Domestic Product (GDP) in 2018, a positive remark that shows how steadily the economy was growing. As at 2020, Ghana’s GDP stood as low as 0.4 percent. In scrutinizing this simple statistical study, one can easily conclude that indeed the covid-19 pandemic overwhelmed our nation’s economy. Once again, one may ask, how exactly then has the pandemic affected Ghana, our dear nation’s economy?

First and foremost, the pandemic affected the social lives of many indigenes within the country, an assertion supported by an extensive research conducted by Aduhene et al.,2021. For instance, the imposition of the infamous lockdown in some part of Greater Accra and Kumasi to prevent coronaviruses' transmission by the President through an executive instrument, led to a significant adverse influence on the various communities within the catchment areas of the country. Other regulations like social distancing, avoidance of social gathering, and travel ban on Ghanaians ultimately affected the economy hence resulting in stress, fear, social stigma, increased level of depression, confusion and anxiety in human behaviors. 

Again, the covid-19 pandemic has exposed the actual picture of the unemployment rate within the country. According to the Trade Union Congress report, ‘about 42,000 people lost their jobs by April only in Ghana where an estimated 75% of them were small traders, daily workers and wage-laborers. This pandemic has constrained to a significant number of salaried workers who lost their jobs, and over 400,000 businessmen and women have lost their businesses as at July 2020. However, small traders like hawkers would return to their work, but the salaried workers will face difficulty to get their jobs back after lockdown with some also facing a cut off up to 50% in their salaries’. The unemployment against the labor participation rate in different regions of the country especially where the lockdown was imposed saw a rise in the unemployment rate as of July 2020. The Trade Union Congress report as of June 2020 shows that Greater Accra and the Ashanti Region (Kumasi) are the hardly hit regions in the country with an unprecedented rise in the unemployment rate in the Ghanaian economy.

Furthermore, our education and agriculture systems were not spared of the troubles. Considering the educational sector, the covid-19 pandemic affected all levels of the education, thus from pre-school through to tertiary education level. For instance, the governments of Ghana completely closed the schools, colleges and institutions to curb the spread of the virus and to protect it citizens. Post-covid-19 analysis has shown that most of these students have been badly affected with majority of them risking dropping out of school due to financial constraints the pandemic has bestowed upon their families of origin. A typical example is what happened at Kwame Nkrumah University of Science and Technology recently where over 6000 students in various programmes were reportedly deferred due to their inability to pay their fees on time. Interestingly, students of College of Health And Well-Being, Kintampo are no exception to this pandemonium where they even struggle to buy common handout. However, it is also worth noting that Ghana's education sector is experiencing a sharp shift from the brick and mortar system of teaching and learning to a virtual learning system dubbed e-learning programs, a move regarded as a positive contribution to the education sector by the covid-19. 

Ghana’s agricultural sector on the other hand, saw some massive shake up due to the lockdown and restrictions from the COVID-19 protocols. Numerous market women who were engaged in the carting of fresh foods from rural communities halted their activities due to fear of spoilage from the slower pace in the purchasing of fresh foods as a result of lockdown measures.

Owing to the poorly managed food supply chains, price hikes set in. As a result, many people were deterred from buying fresh food. Livestock farmers were also adversely affected by the low sales during the pandemic era where most people were not able to gather for their usual Easter, Christmas and other religious based holiday celebrations. Most poultry farmers were affected badly due to low sales and increased pressure from the financial institutions to pay back borrowed loans as well as the scarcity of grains which embraced the economy like never before during the pandemic.

Finally, the COVID-19 pandemic has created an unprecedented challenge for the healthcare industry in this very post covid-19 era. Frankly speaking, the risk to doctors and healthcare frontline workers is one of the most significant vulnerabilities in healthcare systems across the country. During the period, healthcare structures across the country were faced with shortages of PPE, including PPE kit and other equipment such as; N95 face masks, ICU beds, testing kits, ventilators, among others which have exposed the weakness and real scenario of healthcare systems in the country. At this point, it is clear that the healthcare system, one of the promising contributory factor to the economy has been negatively affected by the coronavirus pandemic due to the limited financial resources and increasing overload on the health delivery system.

Considering the above stipulated points, one can easily conclude that indeed the coronavirus disease has done a great disservice to country’s economy. However, it should also be noted that aside these repercussions, there were some positive impact recorded. For instance, many poor sanitation related conditions such as cholera, enteric fever among others were marginally curtailed due to the fact that many people practiced good hygiene such as frequent hand washing, wearing of face mask, practicing social distancing and many more during the covid era. At this juncture, I would like to crave your indulgence to conclude that, the many interventions put forth by the incumbent government in response to the damages incurred through the covid-19 may positively revive the economy, so they say.  

Thank you.

By Michael Kwabena Afful Forson, DPA 300.


Citation

Aduhene, D.T. and Osei-Assibey, E. (2021), "Socio-economic impact of COVID-19 on Ghana's economy: challenges and prospects", International Journal of Social Economics, Vol. 48 No. 4, pp. 543-556. https://doi.org/10.1108/IJSE-08-2020-0582

Ghana Statistical service, 2020.

Citinewsroom report, August 2020.

News Hub Creator newshub-gh@operanewshub.com

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