Economy expands in first quarter

THE first quarter of 2011 saw the country’s economy expanding by 23 per cent when compared to the same quarter in 2010.
The year-on-year Gross Domestic Product (GDP) which measures the monetary value of goods and services produced in the first quarter of this year as compared to those produced in the first quarter of 2010 was valued at GH¢6,660.3 million, up by GH¢1,244.9 million from the 2010 first quarter GDP which stood at GH¢5,415.4 million.
The rise in the year-on-year GDP figures in 2011 when compared with those of 2010 was massively influenced by significant growth rates recorded in the crops (mainly cocoa), mining and quarrying (influenced by crude oil production), manufacturing, construction as well as other sub-sectors.
At a news conference in Accra to announce the GDP estimates for the first quarter of 2011, the Government Statistician, Dr Grace Bediako, said the quarter-on-quarter GDP estimates - comparing growth in the economy in the first quarter of 2011 with that of the last quarter of 2010, however, recorded a decline of 5.1 per cent.
She noted that the decline in the quarter-on-quarter GDP estimates was virtually characteristic of every first and second quarters of previous years and largely attributable to the weak performance in the agriculture sector resulting from the sector’s seasonal production pattern.
“The cyclical trend in agriculture output in the first quarter led to a decline of 35.7 per cent in that sector,” Dr Bediako said adding that all the agricultural sub-sectors further witnessed declines ranging from 19.5 per cent to 41.3 per cent.
For the past five years, first quarter GDP has been witnessing negative growth rates, a situation the government statistician said was mainly due to the heavy decline in the agriculture sector within those periods and the sluggish nature of industry, companies and economic activities in the country during the first four months of every year.
On the quarter-on-quarter sectorial GDP outlook, the agriculture sector, thus, recorded the least growth, contributing only GH¢1479.9 million to the first quarter GDP which represents a negative growth of 35.7 per cent.
The industry sector, however, recorded the highest growth rate of 21.4 per cent, contributing GH¢1,607 million to the first quarter of 2011 GDP estimates.
According to Dr Bediako, the significant rise in the industry sector’s contribution to the first quarter GDP of 2011 , higher than the other two sectors - services and agriculture, was hugely due to high growth recorded in the mining and quarrying sub-sectors coupled with the introduction of crude oil production, a situation she said increased the sub-sector’s output by 136.1 per cent.
She added that growth in the service industries was up by 5.3 in the first quarter of 2011, leading to the sector’s GH¢3,185.1 million contribution to the 2011’s first quarter GDP.
Meanwhile, the month-on-month Producer Inflation, which measures the monthly average changes in the (factory gate) prices,  received by domestic producers and manufacturers for their goods and services rose by 0.74 per cent in May from the April month-on-month rate of 0.63 per cent.
Consequently, domestic producers and manufacturers received higher factory gate prices (prices fixed and received by manufacturers and producers) for their respective goods and services produced within May as compared to the rates received in April.
She, however said the year-on-year rate declined to 23.80 per cent in May from the April figure of 24.29 per cent, the first fall in the producer inflation in thirteen months.
The May producer inflation of 23.80 per cent indicated a 0.49 per cent decline compared to the April rate of 24.29 per cent.
Year-on-year producer inflation has been witnessing a consistent rise in the past 12 months, with the highest rate recorded in  April this year.
In the sector by sector out of the PPI, the Government Statistician said the highest year-on-year price change of 71.84 per cent was recorded in the utilities sub-sector while the manufacturing sub-sector recorded 32.60, the least in the sector by sector outlook.
Mining and quarrying however recorded the highest monthly producer inflation change of 1.36 per cent followed by utilities recording a no change, the lowest in the sector-by-sector comparison.