Oil and Gas Production and the Growth of Ghana’s Economy: An Initial Assessment

Elijah Acquah-Andoh; Denis M. Gyeyir; David M Aanye; Augustine Ifelebuegu

Oil and Gas Production and the Growth of Ghana’s Economy: An Initial Assessment

Elijah Acquah-Andoh, Denis M. Gyeyir, David M Aanye, Augustine Ifelebuegu

School of Energy, Construction and Environment

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Abstract

Oil and gas resources present enormous opportunities for the economic development of low income economies, but poor management of these resources can result in dire consequences for the foundations of the resource-endowed nation. The discovery of oil and gas in Ghana is as significant as the policies and measures to ensure optimum benefits to the nation. This paper evaluates the sustainability of petroleum production in the light of the medium term policy structure, the Ghana Shared Growth and Development Agenda (GSGDA). In particular, the economic contribution of oil and gas to Ghana’s GDP and sustainable investment options for petroleum revenues were examined using ordinary least squares (OLS) regression. The evidence suggests that at current production levels, petroleum is not a significant contributor to Ghana’s GDP after adjusting for the contribution from other sectors of the economy. The consistent appreciation of Ghana’s real effective exchange rate between 2010 and 2013 led to a deterioration of the competitiveness of the non-oil sector and declining contribution of the agricultural sector to GDP; and further eroded the net impact of petroleum production. Investing petroleum proceeds in the non-oil sector and expansion of the export base are a viable option for utilising petroleum revenues.

Original language	English
Pages (from-to)	303-312
Number of pages	10
Journal	International Journal of Economics & Financial Research
Volume	4
Issue number	10
Publication status	Published - 10 Oct 2018

Bibliographical note

This work is licensed under a Creative Commons Attribution 4.0 International License.

Copyright © and Moral Rights are retained by the author(s) and/ or other copyright owners. A copy can be downloaded for personal non-commercial research or study, without prior permission or charge. This item cannot be reproduced or quoted extensively from without first obtaining permission in writing from the copyright holder(s). The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the copyright holders.

Keywords

Ghana
Economy
Oil and gas production;
Growth
Investments
Petroleum revenue

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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Cite this

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title = "Oil and Gas Production and the Growth of Ghana{\textquoteright}s Economy: An Initial Assessment",

abstract = "Oil and gas resources present enormous opportunities for the economic development of low income economies, but poor management of these resources can result in dire consequences for the foundations of the resource-endowed nation. The discovery of oil and gas in Ghana is as significant as the policies and measures to ensure optimum benefits to the nation. This paper evaluates the sustainability of petroleum production in the light of the medium term policy structure, the Ghana Shared Growth and Development Agenda (GSGDA). In particular, the economic contribution of oil and gas to Ghana{\textquoteright}s GDP and sustainable investment options for petroleum revenues were examined using ordinary least squares (OLS) regression. The evidence suggests that at current production levels, petroleum is not a significant contributor to Ghana{\textquoteright}s GDP after adjusting for the contribution from other sectors of the economy. The consistent appreciation of Ghana{\textquoteright}s real effective exchange rate between 2010 and 2013 led to a deterioration of the competitiveness of the non-oil sector and declining contribution of the agricultural sector to GDP; and further eroded the net impact of petroleum production. Investing petroleum proceeds in the non-oil sector and expansion of the export base are a viable option for utilising petroleum revenues.",

keywords = "Ghana, Economy, Oil and gas production;, Growth, Investments, Petroleum revenue",

author = "Elijah Acquah-Andoh and Gyeyir, {Denis M.} and Aanye, {David M} and Augustine Ifelebuegu",

note = "This work is licensed under a Creative Commons Attribution 4.0 International License. Copyright {\textcopyright} and Moral Rights are retained by the author(s) and/ or other copyright owners. A copy can be downloaded for personal non-commercial research or study, without prior permission or charge. This item cannot be reproduced or quoted extensively from without first obtaining permission in writing from the copyright holder(s). The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the copyright holders.",

year = "2018",

month = oct,

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AU - Acquah-Andoh, Elijah

AU - Gyeyir, Denis M.

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AU - Ifelebuegu, Augustine

N1 - This work is licensed under a Creative Commons Attribution 4.0 International License. Copyright © and Moral Rights are retained by the author(s) and/ or other copyright owners. A copy can be downloaded for personal non-commercial research or study, without prior permission or charge. This item cannot be reproduced or quoted extensively from without first obtaining permission in writing from the copyright holder(s). The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the copyright holders.

PY - 2018/10/10

Y1 - 2018/10/10

N2 - Oil and gas resources present enormous opportunities for the economic development of low income economies, but poor management of these resources can result in dire consequences for the foundations of the resource-endowed nation. The discovery of oil and gas in Ghana is as significant as the policies and measures to ensure optimum benefits to the nation. This paper evaluates the sustainability of petroleum production in the light of the medium term policy structure, the Ghana Shared Growth and Development Agenda (GSGDA). In particular, the economic contribution of oil and gas to Ghana’s GDP and sustainable investment options for petroleum revenues were examined using ordinary least squares (OLS) regression. The evidence suggests that at current production levels, petroleum is not a significant contributor to Ghana’s GDP after adjusting for the contribution from other sectors of the economy. The consistent appreciation of Ghana’s real effective exchange rate between 2010 and 2013 led to a deterioration of the competitiveness of the non-oil sector and declining contribution of the agricultural sector to GDP; and further eroded the net impact of petroleum production. Investing petroleum proceeds in the non-oil sector and expansion of the export base are a viable option for utilising petroleum revenues.

AB - Oil and gas resources present enormous opportunities for the economic development of low income economies, but poor management of these resources can result in dire consequences for the foundations of the resource-endowed nation. The discovery of oil and gas in Ghana is as significant as the policies and measures to ensure optimum benefits to the nation. This paper evaluates the sustainability of petroleum production in the light of the medium term policy structure, the Ghana Shared Growth and Development Agenda (GSGDA). In particular, the economic contribution of oil and gas to Ghana’s GDP and sustainable investment options for petroleum revenues were examined using ordinary least squares (OLS) regression. The evidence suggests that at current production levels, petroleum is not a significant contributor to Ghana’s GDP after adjusting for the contribution from other sectors of the economy. The consistent appreciation of Ghana’s real effective exchange rate between 2010 and 2013 led to a deterioration of the competitiveness of the non-oil sector and declining contribution of the agricultural sector to GDP; and further eroded the net impact of petroleum production. Investing petroleum proceeds in the non-oil sector and expansion of the export base are a viable option for utilising petroleum revenues.

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KW - Investments

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JF - International Journal of Economics & Financial Research

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ER -

Oil and Gas Production and the Growth of Ghana’s Economy: An Initial Assessment

Abstract

Bibliographical note

Keywords

UN SDGs

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