Latest data released by the Bank of Ghana indicate that some selected real sector pointers showed progress in economic activity during the third quarter of 2020 when compared with trends observed during the same period in 2019.
The relative pick-up in real sector activities was mainly due to a gradual recovery from the adverse effects of the novel coronavirus outbreak.
The Real Sector comprises households, non-financial organisations and Non-Profit Institutions serving households involved in the production and distribution of goods and services necessary to meet the consumption demand of an economy.
Giving more details, the document titled, The Bank of Ghana Quarterly Bulletin for July to September 2020, stated that economic indicators such as consumer spending, vehicle registration, industry consumption of electricity and port activities went up but tourists’ arrivals declined during the review of the quarter mainly as a result of the closure of the borders and the lockdown.
Consumer spending, measured by domestic VAT collections and retail sales, improved in the third quarter of 2020 compared with figures recorded in the corresponding period of 2019.
“Domestic VAT collections increased by 6.5 percent (year-on-year) to GH¢1,364.72 million, relative to GH¢1,281.65 million collected during the corresponding quarter in 2019. Similarly, domestic VAT grew by 6.6 percent compared with GH¢1,280.39 million collected for the second quarter of 2020,” the statement noted.
Retail sales increased by 45.7 percent (year-on-year) to GH¢286.86 million during the third quarter of 2020 from GH¢196.86 million recorded in the corresponding quarter of 2019.
The comparative improvement in retail sales could be attributed to increased household consumption during the review period.
The report also showed that manufacturing-related activities, as measured by trends in the collection of direct taxes (income, corporate and others) and private sector workers’ contributions to the SSNIT Pension Scheme (Tier-1), posted positive out turns during the third quarter of 2020, compared with what was observed in the same period of 2019.
“Total direct taxes collected increased by 14.4 percent (year-on-year) to GH¢5,278.01 million in the third quarter of 2020, relative to GH¢4,613.69 million recorded for the third quarter of 2019. Total direct tax collected for the quarter under review also grew by 5.2 percent from GH¢5,015.12 million collected in the second quarter of 2020,” the statement added.
In terms of contribution of the various sub-tax categories, Corporate Tax accounted for 54.3 percent, followed by Income Tax (PAYE and self-employed) with 36.2 percent, while other Tax sources contributed 9.5 percent.
Transport-related economic activities, measured by vehicle registration by DVLA, improved by 32.9 percent to 51,703 in the third quarter of 2020 compared to 38,903 vehicles registered during the corresponding quarter of 2019. Similarly, the number of vehicles registered during the review period increased by 23.5 percent relative to 41,879 vehicles recorded in the second quarter of 2020. The comparative improvement recorded in vehicle registration was due to an increase in vehicle importation during the review period.
Industrial Consumption of Electricity
The data shows that the consumption of electricity by industries, which is a substitute for activities within the productive sectors of the economy, went up by 13.3 percent during the third quarter of 2020, compared with the corresponding period of 2019.
Industries utilised 718.58 giga-watts of power in the third quarter of 2020, as against 633.98 giga-watts recorded for the same period in 2019.
Similarly, industrial consumption of electricity increased by 10.4 percent from 650.84 giga-watts utilised for the second quarter of 2020. The relative improvement in the electricity consumed by industries could be attributed to stability in power supply coupled with a rebound in industrial activity following the initial impact of the coronavirus pandemic.
Economic activities at the country’s two main harbours (Tema and Takoradi), as measured by laden container traffic for imports and exports, recorded an improvement during the third quarter of 2020, compared with what was observed in the corresponding quarter of 2019.
Total container traffic for imports and exports went up by 18.7 percent to 183,830 from 154,839 for the third quarter of 2019. Similarly, port activity increased by 25.7 percent when compared to 146,266 laden containers recorded in the second quarter of 2020. The relative improvement in port activities may be attributed to an up-tick in international trade activities during the quarter.
International Tourist Arrivals
However, tourist arrivals into the country fell sharply by 89.3 percent in the third quarter of last year when compared with figures recorded a year ago.
A total of 32,602 tourists entered the country during the review period, as against 304,601 visitors received in the third quarter of 2019.
The decline in tourist arrivals (year-on-year) was mainly due to travel restrictions in the fight against the COVID-19 outbreak during the first- two months of the quarter.