Economic recovery: Progress on paper, but not in people’s pockets – Economist

Ghana’s recent macroeconomic improvements may paint a picture of recovery, but for many citizens, that progress remains out of reach.

That’s the cautionary message from Professor Patrick Asuming, economist and lecturer at the University of Ghana Business School.

In a recent interview, Prof. Asuming urged policymakers and the public not to overstate the significance of recent positive indicators such as falling inflation, a stabilising cedi, and improved foreign reserves, warning that these headline numbers don’t necessarily reflect the lived realities of most Ghanaians.

“It seems to me that the financial and monetary side of the economy is recovering faster, while the real side, the part that directly affects people’s everyday lives is still lagging,” he said.

He noted that although inflation and the Producer Price Index (PPI) have declined from around 18% to 10% in the case of the PPI, this does not mean prices are going down.

“Prices are still rising. What has changed is the pace of increase, not the direction. A slowdown in inflation doesn’t translate into cheaper goods and services,” Prof. Asuming explained.

He acknowledged recent financial gains, including a stronger cedi, healthier foreign reserves, and falling Treasury bill rates.

But he emphasised that these improvements do not automatically bring relief to households or small businesses.

According to Prof. Asuming, the government deserves credit for taking decisive steps to stabilise its fiscal position, including benefiting from favourable global commodity prices.

However, he argued that the benefits of this recovery are not yet reaching ordinary Ghanaians.

“Government has made real progress on the fiscal front. Our reserve position has improved due to both sound policy and a bit of luck with export prices. But the recovery is uneven. The real economy, the one that affects incomes, jobs, and cost of living is still catching up,” he said.

He pointed to the first quarter GDP figures for 2025 as a case in point.

While the overall growth rate exceeded expectations, a closer look reveals weaknesses.

“Out of 20 sub-sectors, five actually contracted. The strong performance in a few heavily weighted sectors boosted the headline number, but that masks the struggles in other parts of the economy,” he explained.

Prof. Asuming warned against placing too much faith in top-line numbers, stressing the need for a more grounded understanding of the country’s economic health.

“We can’t afford to confuse statistical recovery with real recovery. A drop in inflation doesn’t mean prices are falling, and positive GDP numbers don’t mean everyone is better off,” he said.

“People are still under pressure. The average Ghanaian is not yet feeling the recovery.”

He concluded by calling for a sharper focus on closing the gap between macroeconomic progress and improvements in everyday life.

“Until the real economy starts to catch up with the financial indicators, we will continue to see a recovery that exists more on paper than in people’s pockets.”