Oil Production in Ghana: Implications for Economic Development

This ARI looks at the revenue stream likely to accrue to Ghana from oil production which is to start in 2010 and the implications for the economy. The first part of this ARI sets the tone by looking at the trends in key economic indicators for Ghana from the 1990s to date. It notes that even though the economy has made significant gains, it still remains fragile, with inequality persisting. The second part looks at the expected revenue from oil production and what the implications are for the economy. Here it estimates that oil revenues to Ghana will at a minimum be in the range of US$1.2 billion to US$2.5 billion over 2010-12 when production hits the expected maximum of 250,000 barrels per day. It goes on to argue that this income stream will significantly help fiscal consolidation in Ghana. However, it also notes that if not managed properly it could have serious repercussions for the real sector of the economy